WCOM and Bell Canada???
Subj: Canada's BCE Explores Possible Alliances With WorldCom-MCI, Other
By Ben Dummett, Staff Reporter
TORONTO -(Dow Jones)- Faced with rapid consolidation in the
telecommunications industry, Canada's giant BCE Inc. said Friday that
it's talking with merger partners WorldCom Inc. and MCI Communications
Corp., among others, about a possible alliance.
BCE is the parent of Bell Canada, Canada's biggest
telecommunications company. When asked about the talks with
WorldCom-MCI, Jean Monty, BCE's president and chief operating officer,
said in a brief telephone interview, "We're talking to a lot of people.
We're talking to WorldCom-MCI," adding that MCI (MCIC) has been a BCE
(BCE) partner since 1992. Monty declined further comment.
WorldCom and MCI are expected to close their planned $37 billion
merger in the third quarter.
An analyst who recently met with BCE officials said BCE's telephone
arm, Bell Canada, is talking with WorldCom-MCI about a potential
alliance that would expand Bell Canada's operations beyond North
America, which is consistent with BCE's stated goal of growing
internationally.
In addition, an alliance could potentially provide Bell Canada with
more network capacity in the U.S., said the analyst, who requested
anonymity.
BCE executives also are attracted to WorldCom's strategy of creating
a low-cost, high-speed network based on Internet protocol, the analyst
said.
No one was immediately available at WorldCom for comment.
The stock of Montreal-based BCE Inc. (BCE) has been under pressure
from some big announcements in the telecommunications industry, which
raised concerns among some investors about BCE's future competitive
position, analysts said.
On Monday, U.S. telecom giant AT&T Corp. (T) and British
Telecommunications PLC in the United Kingdom announced plans to join
forces in a new global alliance that would offer voice, data and video
services to corporate customers. Also this week, U.S. telephone
companies Bell Atlantic Corp. (BEL) and GTE Corp. (GTE) announced plans
to merge.
The analyst, who didn't want to be identified, cautioned that it's
difficult to estimate the possible benefits of any alliance between
BCE's Bell Canada and the merged WorldCom-MCI, or another partner, until
details of any such deal are known.
Mark Bruneau, president of the Global Communications & Computing
group at Renaissance Worldwide Inc., noted that existing telecom
alliances such as Concert Communications Services and Global One haven't
had much success at increasing the market reach of their members.
Renaissance Worldwide is a technology consulting company based in
Boston.
For Bruneau, a more effective strategy to extend market reach would
be to create a joint-venture company that's funded by both partners,
with real assets and a dedicated sales force.
At the same time, an alliance between Bell Canada and the merged
Worldcom and MCI could prove promising because of Bell Canada's Bell
Emergis unit, which Bell Canada created last year to develop new
complementary technologies in areas including the Internet, electronic
commerce and multimedia.
Through an alliance with Bell Canada, WorldCom and MCI could get
access to Bell Emergis' new technologies, while Bell Canada could get
"influence and a voice in the overall alliance in product development
and not just reciprocal network usage," Bruneau said.
-By Ben Dummett; 416-943-7807
Subj: Canada's BCE Explores Possible Alliances With WorldCom-MCI, Other
By Ben Dummett, Staff Reporter
TORONTO -(Dow Jones)- Faced with rapid consolidation in the
telecommunications industry, Canada's giant BCE Inc. said Friday that
it's talking with merger partners WorldCom Inc. and MCI Communications
Corp., among others, about a possible alliance.
BCE is the parent of Bell Canada, Canada's biggest
telecommunications company. When asked about the talks with
WorldCom-MCI, Jean Monty, BCE's president and chief operating officer,
said in a brief telephone interview, "We're talking to a lot of people.
We're talking to WorldCom-MCI," adding that MCI (MCIC) has been a BCE
(BCE) partner since 1992. Monty declined further comment.
WorldCom and MCI are expected to close their planned $37 billion
merger in the third quarter.
An analyst who recently met with BCE officials said BCE's telephone
arm, Bell Canada, is talking with WorldCom-MCI about a potential
alliance that would expand Bell Canada's operations beyond North
America, which is consistent with BCE's stated goal of growing
internationally.
In addition, an alliance could potentially provide Bell Canada with
more network capacity in the U.S., said the analyst, who requested
anonymity.
BCE executives also are attracted to WorldCom's strategy of creating
a low-cost, high-speed network based on Internet protocol, the analyst
said.
No one was immediately available at WorldCom for comment.
The stock of Montreal-based BCE Inc. (BCE) has been under pressure
from some big announcements in the telecommunications industry, which
raised concerns among some investors about BCE's future competitive
position, analysts said.
On Monday, U.S. telecom giant AT&T Corp. (T) and British
Telecommunications PLC in the United Kingdom announced plans to join
forces in a new global alliance that would offer voice, data and video
services to corporate customers. Also this week, U.S. telephone
companies Bell Atlantic Corp. (BEL) and GTE Corp. (GTE) announced plans
to merge.
The analyst, who didn't want to be identified, cautioned that it's
difficult to estimate the possible benefits of any alliance between
BCE's Bell Canada and the merged WorldCom-MCI, or another partner, until
details of any such deal are known.
Mark Bruneau, president of the Global Communications & Computing
group at Renaissance Worldwide Inc., noted that existing telecom
alliances such as Concert Communications Services and Global One haven't
had much success at increasing the market reach of their members.
Renaissance Worldwide is a technology consulting company based in
Boston.
For Bruneau, a more effective strategy to extend market reach would
be to create a joint-venture company that's funded by both partners,
with real assets and a dedicated sales force.
At the same time, an alliance between Bell Canada and the merged
Worldcom and MCI could prove promising because of Bell Canada's Bell
Emergis unit, which Bell Canada created last year to develop new
complementary technologies in areas including the Internet, electronic
commerce and multimedia.
Through an alliance with Bell Canada, WorldCom and MCI could get
access to Bell Emergis' new technologies, while Bell Canada could get
"influence and a voice in the overall alliance in product development
and not just reciprocal network usage," Bruneau said.
-By Ben Dummett; 416-943-7807
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