Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Microcap & Penny Stocks : FRANKLIN TELECOM (FTEL) -- Ignore unavailable to you. Want to Upgrade?

To: jan fine who wrote (31632)	4/3/1998 12:54:00 PM
From: Billwar	Respond to of 41046

FYI - Business Week Special Report article on VOIP and WCOM Article titled "Telecom's New Trailblazers" and can be found at businessweek.com Section concerning WCOM follows ''CONCERNED.'' Most of the Baby Bells snort at the notion that these upstarts will horn in on their core businesses. ''You have to separate the hype from the reality,'' says Ameritech Corp. CEO Richard C. Notebaert. ''We have customers, real customers, paying hundreds of millions of dollars to us today. When you look at Level 3 and Qwest, how many customers do they have?'' The difference is orders of magnitude. But the mavericks do have an advantage: They can avoid paying the Bells access charges. These are fees that long-distance companies pay the local players to carry a call from a home or office to the long-distance network, and on to its destination. They're about 4 cents a minute. Because voice calls over converged networks are considered data, these companies pay little if any of these fees. Four cents a minute adds up. If 13% of the long-distance traffic travels over converged networks in 2002, as consultant Frost & Sullivan projects, the lost access charges would cost the Bells about $4 billion a year. The Bells are not happy about the prospect. They argue that it is fundamentally unfair for voice calls over converged networks to avoid access fees, while traditional voice calls pay the freight. ''Clearly, it's something we're concerned about,'' says Lawrence T. Babbio Jr., president of Bell Atlantic Corp.'s network group. The Bells are hardly alone in their complaints. Legislators whose states use the access charges to subsidize telephone service are bristling. Senator Ted Stevens (R-Alaska) has asked the FCC to review the situation, especially since he feels AT&T and WorldCom with MCI could try to avoid the fees, too. ''You've got the potential for bypass on a massive scale, and it's not too far off,'' says Mitch Rose, Stevens' chief of staff. ''It's coming at us like a freight train.'' Still, it looks as if the mavericks won't get hit with full access charges anytime soon. There's tremendous public sentiment to leave the Internet untaxed. So which of the traditional telecom companies are most prepared for the impact of the converged networks? WorldCom Inc. stands head and shoulders above the rest. With the purchase of UUNet Technologies, WorldCom CEO Bernard J. Ebbers landed the largest carrier of Internet traffic in the world. If WorldCom merges with MCI as planned, it will control by some estimates more than 50% of the Internet backbone--enough that the trustbusters in Washington are voicing concerns. So far, WorldCom has kept its voice traffic on traditional networks and is using UUNet to pursue new growth opportunities, such as fax, over IP. But as voice, data, and video converge, WorldCom will have the expertise and the assets to cash in on the boom. ''Our vision is to build a phone company that looks more like a Silicon Valley startup,'' says John Sidgmore, president and CEO of Fairfax (Va.)-based UUNet." FTEL's alliance with WCOM should be a real winner.