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Technology Stocks : Covad Communications - COVD -- Ignore unavailable to you. Want to Upgrade?

To: Alan Bell who wrote (104)	4/21/1999 1:57:00 AM
From: BIGFRED	Read Replies (1) \| Respond to of 10485

Contest for fast Net link picks up • DSL service: Covad entry into Bay Area to offer consumers more choice. BY JON HEALEY Mercury News Staff Writer Consumers gain another choice for high-speed Internet access today as Covad Communications Inc. of Santa Clara launches a lower-priced version of its data service. The move could make high-speed service available to more Bay Area homes, although not at a lower price than has already been available. It also will increase pressure on Pacific Bell and the local cable companies to improve the customer service they offer on their high-speed services. The technology used by Covad is known as digital subscriber line, or DSL. It establishes a continuous, high-speed connection to the Internet over a pair of copper wires separate from the ones used for phone service, allowing users to surf the Web or check e-mail without tying up their phones. Covad's least expensive service is expected to sell for $39 per month, with an additional $10 to $30 per month required for Internet access. Pac Bell Internet offers high-speed service and access for $49 per month. Covad's price is $9 to $29 more per month than the @Home high-speed cable modem service offered by AT&T subsidiary Tele-Communications Inc., which is changing its name to AT&T Broadband and Internet Services. The Covad ''TeleSurfer'' service is potentially slower than the other offerings, too, with maximum downloading speeds of 384 kilobits per second, or about eight times the fastest dial-up modem. Pac Bell's basic service has a top speed between 384 kbps and 1.5 megabits per second, or up to 30 times the fastest dial-up modem, depending on the user's distance from Pac Bell's offices. @Home's speeds vary with the number of users in a neighborhood. Covad's ''TeleSurfer Pro'' service will provide downloading speeds up to 768 kbps, or more than 15 times the fastest dial-up modem. That service will sell for $49 per month, plus $10 to $30 per month for Internet access. ISPs provide the link Covad provides a high-speed link between the customer and Pac Bell's central offices using Pac Bell's copper wires. It doesn't supply the connection to the Internet; instead, that's done by selected Internet service providers, including Flashcom, Concentric Network, Vario Inc. and DNAI in the Bay Area. The main advantage that Covad claims is availability. The company has installed equipment in more communities than either Pac Bell or AT&T has, covering more than 80 percent of the homes and small businesses from Santa Rosa to Santa Cruz, said Richard Wong, director of product marketing. John Britton, a spokesman for Pac Bell, challenged Wong on that point. ''We're pretty much everywhere in the Bay Area,'' Britton said. Still, Britton said that Pac Bell welcomed the competition. ''Choice is good for customers,'' he said, adding, ''We're seeing three to four times the demand we expected.'' Neither Pac Bell nor TCI officials have announced how many high-speed customers they have in the Bay Area. Wong also said Covad intends to provide better customer service than its competitors. Customers with @Home cable modem service have complained this year about waiting as long as two hours on hold to the technical support line, while occasional problems with Pac Bell's installation and customer-support efforts also have angered some consumers. Aiming for consumers Covad's move is significant because it's the only one of Pac Bell's competitors making a play for consumers. All the others -- from giants like MCI WorldCom to upstarts like Focal Communications Corp. -- are aiming exclusively for business customers, where the profit margins are higher. Still, other competitors are likely to follow Covad into the consumer market as new technology pushes down the cost of digital subscriber lines. For example, NorthPoint Communications of San Francisco announced Monday an alliance with Microsoft Corp. designed to promote the availability of high-speed service to consumers and businesses. Microsoft said it expects to invest $30 million in NorthPoint and may buy up to 100,000 high-speed lines at wholesale rates from the company over the next two years. In addition to the Bay Area, Covad's TeleSurfer service will also be available in greater Los Angeles, Sacramento, San Diego, Seattle, Boston, New York, Philadelphia, Baltimore and Washington, D.C., Wong said.