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To: david thor who wrote (9056)	4/15/1999 3:22:00 AM
From: zebraspot	Read Replies (1) \| Respond to of 10227

>>This excerpt from Bloomberg makes me wonder if Sidgemore is a visionary, a little too tolerant of his timeframe for getting into wireless or is trying to negotiate a deal in public?<< Sounds like the latter to me. What are they going to say? WE NEED IT BAD and NOW!

To: david thor who wrote (9056)	4/15/1999 4:37:00 AM
From: Nicholas Thompson	Read Replies (2) \| Respond to of 10227

IBD interview - the part that I noticed was that the more types of services you offer the less churn you have. wcom needs wireless! Any sports team knows that staying aggressive often is the best way to keep a big lead. That's a strategy MCI WorldCom Inc. plans to use in the communications industry. MCI WorldCom has a big head start on most other phone companies in Internet services. It's also building a worldwide data network that will cater to businesses. The company's rise began when it acquired MFS Communications Co. and UUNet Technologies Inc. in 1996. John Sidgmore, formerly the chief executive of UUNet, is now MCI WorldCom's vice chairman. He talks about the company's strategy in this interview. IBD: Will MCI WorldCom make more acquisitions? Sidgmore: We still view the industry as a development opportunity. You're going to continue to see us be aggressive by deploying our own capital and also by making acquisitions. We're obviously going to continue to expand our Internet network around the world and expand our international presence as fast as we can. You can imagine some international acquisitions as we try to color in the map over time. It's unlikely we would add additional long-distance networks here in the U.S. IBD: MCI WorldCom says it doesn't want to make deals that dilute earnings. Is that short-term thinking? Sidgmore: Historically, we've had a strong distaste for dilutive transactions. That's not to say they're out of the question. To move into local markets we acquired MFS, which was dilutive. We'll do the right thing strategically, but that doesn't mean we don't have a strong aversion to dilutive deals. IBD: Companies like Qwest Communications International Inc. would like to mirror MCI WorldCom's success in the business market. Can that happen? Sidgmore: If you look at these new players, whether it's Qwest or Level 3 Communications Inc., most of them are deploying long-haul backbone assets that connect cities, as opposed to local assets that connect buildings and businesses. We do both. To a great extent, developing the local assets is the hard part. Digging up the streets of Paris and deploying local fiber to buildings and businesses is a lot harder than connecting Paris to London. IBD: But Qwest has invested in U.S. start-ups, such as Covad Communications Inc., that sell high-speed digital subscriber lines to consumers. Other rivals are investing in wireless broadband services. Is MCI WorldCom interested in similar assets? Sidgmore: We have an investment in Rhythms NetConnections Inc., which is in the same space as Covad. As all these new technologies come on stream - DSL, wireless or satellite for that matter - we'll be aggressive. Fixed wireless? I don't know if we'll make an acquisition there or not. But we'll certainly have much more fixed-wireless capacity in our network two years from now than we do today. IBD: Does AT&T Corp.'s purchase of Tele- Communications Inc. and other cable deals pose a threat to MCI WorldCom? Sidgmore: AT&T is in a different place than we are. Our focus is on the business marketplace. We do have a consumer business, but it's a small part of our business. AT&T's business is 50% consumer and residential service. If you need to support them, cable TV is a legitimate option. From our standpoint, cable TV (wiring) wouldn't be very useful; it doesn't run to most businesses. IBD: AT&T also acquired a local phone start-up, Teleport Communications Group Inc., and IBM Corp.'s global data network. How do those assets compare with MCI WorldCom's? Sidgmore: Those are moves we already made. Before AT&T bought Teleport, Worldcom had acquired MFS, the largest CLEC (competitive local exchange carrier). The same thing would be true of a data network, since UUNet was part of MFS. If you look at the real local networks that support business, the Internet networks, the international assets, it would be hard to see where AT&T has any advantage over us. IBD: Rivals would like to take away MCI Worldcom's business customers. What's the key to keeping them? Sidgmore: The data show that the more services you provide to a customer, the less churn you have. If you provide local and long-distance, you have a much higher loyalty factor. If you package those services in an attractive way, you're going to keep those customers for a long time. The way to attract them, we think, is by providing quality- of-service guarantees. That's a very critical part. IBD: As electronic commerce takes off, how well-positioned is MCI WorldCom as a supplier of services over the Internet? Sidgmore: In terms of reliability, quality, security and the industrial-strength requirements that come with electronic commerce, I think we're better suited than anyone. We have the largest Internet capability. Our network from the beginning was designed to handle business transactions, not consumer transactions. IBD: What do companies want from a global provider of data services? Sidgmore: There are a lot of industry acronyms to describe those things, but capacity, quality, reliability and security are what give a network industrial strength. Most global corporations need a lot of capacity, and they want to buy it in a cost-effective way. They need to get access to that capacity on a worldwide basis, not just in the U.S. And they need a high-quality network so their customers don't get frustrated. IBD: There's talk that once the regional Bells get into long-distance, flat-rate pricing -regardless of distance or time of day - will be more common in the industry. Do you agree? Sidgmore: There's going to be lots of experimentation with pricing over the next few years. Clearly as businesses buy high-speed access, there's going to be a blurring between what was voice and data and what was long-distance or local. There probably will be a predisposition toward flat-rate pricing by the amount of bandwidth you buy, and there'll be exceptions, like international calls. IBD: In New York, MCI WorldCom plans to sell phone service to residential customers by leasing part of Bell Atlantic Corp.'s local network. How viable an approach is that in the 50 biggest markets in the U.S.? Sidgmore: Time will tell. We don't know the answer to that. Fundamentally, we believe that unbundling (sharing) the network elements in the regional Bell systems and in cable TV networks will be in the country's best interest. Ultimately, we think that will be accomplished. How practical that is over the next 12 months is unclear. //////////////////////////////////////////////////////////// Copyright (c) 1999 Investors Business Daily, All rights reserved. Investor's Business Daily - Computers & Technology (04/15/99) MCI WorldCom Flexes Muscles To Retain Lead By Reinhardt Krause 4/14/99 3:01 PM