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To: Frank A. Coluccio who wrote (1152)	8/21/1998 11:07:00 AM
From: Frank A. Coluccio	Respond to of 3178

Merger Activity Promotes Competition August 21, 1998 WASHINGTON, Aug. 20 /PRNewswire/ via NewsEdge Corporation -- The tsunami of mergers and acquisitions involving competitive local exchange carriers (CLECs) in the past two years significantly increased the viability of local competition. The mergers of MFS with Wordcom/ UUNET/MCI and TCG with AT& T/Cerfnet, among others, place these CLECs at the front of the new telecommunications world order. The combined operations of CLECs, interexchange carriers (IXCs), and Internet service providers (ISPs) enables these carriers to offer the comprehensive communications solutions that customers now demand. In this position, CLECs are poised for significant growth -- far and above what might have been possible as single service carriers. "Branding is at the heart of our analysis here. Combining the nationwide brand recognition of leading IXCs with the ability to offer total communications solutions, places these new super carriers at the front of the pack," says Daniel Ernst, The Strategis Group's competitive telephony analyst. Ten years ago, customers in New York City had one option for local phone service. However, the launch of TCG, the first competitive access provider (CAP), changed that and began a process of opening local markets to competition. Today, New York City is served by 15 CLECs. Nationwide, 135 basic trading areas (BTAs) are served by at least one CLEC, up from 108 at mid-year 1997. Fifty-nine BTAs are served by more than two CLECs. Collectively these CLECs serve markets representing 75% of U.S. businesses. CLEC Coverage of Business Markets # of Competitors Zero One Two or more % of Business Markets 25% 8% 67% Source: The Strategis Group, Inc. By year-end 1997, CLECs earned $3.3 billion in revenue -- capturing 5% of the local business communications market. Driven by continued market expansion, substantial investment, and newfound market positioning, The Strategis Group expects that CLECs will take almost one-fourth of the business market by 2003. Growing at a compound annual rate of 30%, CLEC local revenues will reach just under $22 billion by 2003. CLEC Market Share, 1994-2003 Year 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 CLECs 1.4% 2.0% 3.0% 5.1% 8.5% 11.7% 15.2% 18.3% 21.0% 23.1% Source: The Strategis Group, Inc. U.S. Competitive Local Markets -- 1998 provides a comprehensive examination of local telephone markets and the impact of competition. The study provides an estimate of current and future market opportunity for local services, examines the performance of CLECs, outlines critical demand factors, and profiles LECs, IXCs, and CLECs. The Strategis Group (an edr company) -- with offices in Washington DC, London, and Singapore -- publishes in-depth market research reports, provides proprietary consulting, and delivers continuous information services to the telephony, cable TV, broadband, Internet, satellite, and wireless communications industries. U.S. Competitive Local Markets - 1998 is available for US$2,400. Please contact Daniel Ernst at 202-530-7500 (phone), 202-530-7550 (fax), dernst@strategisgroup.com (e-mail), or visit www.strategisgroup.com for more information. The graphics contained in this release are available in several electronic formats for press use provided that appropriate attribution is credited to The Strategis Group and U.S. Competitive Local Markets - 1998. SOURCE Strategis Group /CONTACT: Daniel Ernst of the Strategis Group, 202-530-7500/ /Web site: strategisgroup.com [Copyright 1998, PR Newswire]