HUGE news out on Index member MCOM, up $4 in pre market-
(BSNS WIRE) Metricom Secures $600 Million Investment from MCI WorldCom a
Metricom Secures $600 Million Investment from MCI WorldCom and Vulcan Ventures,
Inc. to Fund National Wireless Data Network Expansion
Business Editors, High-Tech Writers
LOS GATOS, Calif.--(BUSINESS WIRE)--June 21, 1999--Metricom, Inc.
(Nasdaq:MCOM), a leading provider of mobile data networking and
technology, today announced $600 million in funding from Vulcan
Ventures, Inc. and MCI WorldCom, each providing $300 million, to fund
national rollout of its Ricochet 128 kbps mobile data service.
The first wave of commercial availability is scheduled for
mid-2000. In addition, MCI WorldCom and Metricom have entered into a
strategic relationship, which includes national distribution of
Ricochet.
Under the terms of the deal, MCI WorldCom and Vulcan Ventures,
Inc. will purchase 60 million new convertible preferred shares of
Metricom stock, priced at $10 per share. When consummated, and
following an allowed conversion from preferred to common, the
breakdown of ownership will include Vulcan Ventures, Inc. at 49
percent, MCI WorldCom at 38 percent, with the remaining 13 percent
ownership held by other current public shareholders. The transaction
is subject to certain conditions, including Metricom shareholder
approval. Metricom will remain a publicly traded company headed by CEO
Timothy A. Dreisbach. The investment underscores Vulcan Venture Inc.'s
ongoing endorsement of Metricom and the Ricochet technology.
Included in the strategic agreement, MCI WorldCom has signed a
five-year, non-exclusive wholesale agreement valued at $350 million
with Metricom for its Ricochet services. Metricom will utilize MCI
WorldCom's high-speed data and Internet network and support operations
as it expands nationally. Metricom will also enlist additional
distribution channels for Ricochet, and embark on a multi-million
dollar branding and marketing campaign to raise awareness and advance
adoption of the service among the target market of mobile
professionals.
"Our ultimate goal is to allow mobile professionals to take their
full desktop functionality anywhere they need to work," said
Dreisbach. "This means accessing data and applications on corporate
LANs and the Internet anywhere in the same fashion as sitting in an
office. By teaming with Vulcan Ventures, Inc. and a strategic partner
with the national presence and reputation of MCI WorldCom, we gain the
resources and expertise to accelerate the availability and adoption of
our Ricochet service on a nationwide basis."
Metricom targets multiple segments within the overall mobile
worker marketplace. One of these segments includes the mobile
professional "road warriors" who travel extensively for their jobs. In
a recent study, International Data Corporation (IDC) predicted by 2001
that 7.3 million of the professionals in this segment, who carry
cellular/PCS phones, laptops and other mobile computing devices, do
business within the metropolitan areas included on Metricom's rollout
plan. "The mobile professional market available to Metricom is
forecast to exceed 13 million users in 2005," said Iain Gillott, vice
president, Worldwide Consumer & Small Business Telecommunications at
IDC. "Critical success factors in this segment of the mobile data
market are the ability to provide cost effective, reliable mobile
Internet and LAN access throughout the major metropolitan areas."
In addition to the primary business user market, Ricochet
addresses the high bandwidth data access requirements of residential
users that may not have viable ISDN, cable or DSL alternatives.
Unlike technologies just now evolving to solve growing
high-performance high-speed wireless data requirements, Ricochet is a
proven technology that leads the industry today at 28.8 kbps. Building
on Ricochet's success, Metricom has been testing 128 kbps service and
expects to launch the higher speed service in mid-2000 in the
following metropolitan areas: Atlanta, Baltimore, Chicago, Dallas,
Houston, Los Angeles, Phoenix, San Diego, San Francisco, Seattle, New
York, Washington, DC. Current rollout plans call for a total of 46
metropolitan areas to gain Ricochet coverage by mid-2001.
"We have been impressed with the management, focus, and
technology advancement made by Metricom over the past year," said
William D. Savoy, President, Vulcan Ventures, Inc. "By adding a
world-class partner like MCI WorldCom, we expect to accelerate the
availability and adoption of Ricochet by mobile professionals who want
fully functional access to applications and data on LANs, Intranets
and the Internet anywhere, anytime."
Ricochet is uniquely positioned to capture a significant share of
the growing mobile professional market with the fastest data speeds,
"always-on" connections, flat-rate "all-you-can-use" pricing, no
metered roaming fees, and true mobility at 70 mph. These benefits are
a result of the Ricochet architecture, which is based on a digital
packet-switched network employing spread-spectrum radio frequency
transmission and standard Internet protocol (IP). Ricochet was
designed from inception for packet data, which means high throughput,
extremely low Bit Error Rate (BER), instantaneous handoff, and low
cost per connection.
About Metricom
Metricom, Inc. is a leading provider of mobile data networking
and technology. The Company's Ricochet service provides mobile
professionals with high-performance, cost-effective untethered access
to the Internet, private Intranets, local-area networks, e-mail, and
other online services. Ricochet is generally available in the greater
San Francisco Bay Area, Seattle, and Washington, D.C. metropolitan
areas; in select areas of New York City; on corporate campuses; and at
gate areas at major airports throughout the United States. For more
information, call 1-800 Go-Wireless, or visit Metricom's Web site at
metricom.com.
About MCI Worldcom
MCI WorldCom is a global leader in communications services with
1998 revenues of more than $30 billion and established operations in
over 65 countries encompassing the Americas, Europe and the
Asia-Pacific regions. MCI WorldCom is a premier provider of
facilities-based and fully integrated local, long distance,
international and Internet services. MCI WorldCom's global networks,
including its state-of-the-art pan-European network and transoceanic
cable systems, provide end-to-end high-capacity connectivity to more
than 40,000 buildings worldwide. MCI WorldCom is traded on NASDAQ
under WCOM. For more information on MCI WorldCom, visit the World Wide
Web at wcom.com.
About Vulcan Ventures Inc.
Vulcan Ventures Inc. of Bellevue, Washington was founded by Paul
G. Allen in 1986 to research and implement his investments. Allen's
investments through Vulcan Ventures, Inc. are long-term, as his goals
enable him to take above-average risks and a long-term view. Through
Vulcan Ventures, Allen invests in companies which offer products,
services or technologies that fit his wired world strategy, and can
contribute to or benefit from the technology and strategy of other
Paul Allen companies.
Metricom and Ricochet are registered trademarks of Metricom, Inc.
All other trademarks are the property of their respective owners.
This press release may contain forward-looking statements. These
forward-looking statements are subject to risks and uncertainties.
Actual results may differ materially from such forward-looking
statements as a result of risks and uncertainties, including those
described in Metricom's 1998 Form 10-K and other reports filed with
the Securities and Exchange Commission.
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CONTACT: Metricom, Inc.
Jeannie Slone, 408/399-8136
or
MCI WORLDCOM
Frank Walter, 800/644-NEWS
Investors
Gary Brandt, 601/460-8544
or
Vulcan Ventures, Inc.
Nicole Christie, 425/453-1940
KEYWORD: CALIFORNIA WASHINGTON
INDUSTRY KEYWORD: COMPUTERS/ELECTRONICS COMED TELECOMMUNICATIONS
PRODUCT INTERACTIVE/MULTIMEDIA/INTERNET
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