Article from this morning's Providence Journal.
Internet firm plans R.I. phone service
By TIMOTHY C. BARMANN
Journal Staff Writer
Log On America says it has begun its transformation into a telephone company and will begin offering telephone service throughout Rhode Island this summer.
The company, which offers Internet services, said Monday it has signed a contract with Nortel Networks to provide telephone switching equipment, said David R. Paolo, Log On America's chief executive officer. The equipment will be installed at Log On America's headquarters in Providence, and in about 30 Bell Atlantic central offices throughout the state for Log On America's use.
The deal also calls for Nortel to temporarily provide ''a handful'' of employees who have expertise in technical and regulatory issues, Paolo said.
''We're going to need extensive expertise in integrating'' telephone, Internet and cable services, Paolo said. ''Nortel brings those to the table for us.''
Nortel is a major supplier of telephone and data network equipment. It is a Canadian company based in Brampton, Ont.
Paolo declined to disclose the value of the contract. One of Log On America's directors, David M. Robert, is a vice president of sales for Nortel.
The equipment will be installed within the next 12 weeks and Paolo said Log On America will begin offering statewide telephone service to homes and businesses ''on day one.''
If that schedule holds, Log On America could become the first competitor of Bell Atlantic to offer residential telephone service in Rhode Island.
Cable giant Cox Communications has said it will offer telephone service the second quarter of this year, but it has not been any more specific about its plans.
In addition, Log On America said it will offer high-speed Internet service to homes and businesses. That service will be available in about half the state at the same time phone service is launched, Paolo said. Service will be available for the rest of the state in the following 60 days, Paolo said.
The company has not set the pricing on the Internet service, but Paolo said it will be ''very competitive'' with the high-speed Internet access service offered by Cox Communications, which costs $45 a month, including modem rental.
Log On America's high-speed Internet service, which uses a technology known as DSL, or digital subscriber line, allows a customer to speak on the telephone and access the Internet through a single phone line at the same time.
Log On America and several other Internet access providers already offer various forms of DSL service in Rhode Island, but it is mostly geared toward business customers. Log On America offers such service to ''a couple hundred'' customers in Providence, Cranston and Warwick, he said.
Log On America is one of several companies in Rhode Island known as a ''CLEC,'' or competitive local exchange carrier. That means the company has been given permission by the state to offer telephone service using its own equipment. It has similar applications pending in Connecticut and Massachusetts, Paolo said.
The company does not yet offer any telephone services.
However, the company's press releases seem to indicate that it is already providing these services.
Monday's press release, for example, says ''Log On America is a Northeast regional Competitive Local Exchange Carrier (CLEC) . . . providing local dial-tone, instate toll, long distance, high-speed Internet access and cable programming.''
The company also does not offer any cable services and it does not have an agreement in place to offer cable television programming, Paolo said. The company hopes to have such a deal by the end of the year, he said.
Asked about the discrepancy, Paolo said, ''the company's position has always been we are striving to bring those together. As a CLEC, we could offer those services today.''
Log On America is traded on the Nasdaq national market under the symbol LOAX. Its stock closed yesterday at $27.50 a share, up 50 cents a share. The company, which went public last month, had revenues last year of about $776,000, and a net loss of about $422,000, according to the company.
The company will report its first and second quarter earnings for this year at the same time in August, Paolo said. |
