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Technology Stocks : How high will Microsoft fly? -- Ignore unavailable to you. Want to Upgrade?

To: blankmind who wrote (21897)	4/30/1999 8:33:00 PM
From: puborectalis	Respond to of 74651

Good item on GBLX...H&Q report: Global Crossing builds undersea network By Stephanie Gates Red Herring Online April 30, 1999 Bermuda-based Global Crossing (Nasdaq: GBLX) may be public, but the international communications network company is still in development. At the Hambrecht & Quist (NYSE: HQ) Technology Conference yesterday, Global Crossing's CFO Dan Cohrs told potential investors that the company was currently building an international high-speed undersea fiber network that "will connect 159 cities in the world on our own fiber." Stock investors responded to Global Crossing's March announcement of a merger with communications network company Frontier Communications (NYSE: FRO) by driving the stock price up about 20 points to $60. They were eager to hear the company's presentation at this week's conference. According to Mr. Cohrs, Global Crossing is responding to the explosion in worldwide demand for bandwidth by building an advanced global Internet protocol (IP) fiber network. He predicted the core network would be operational by the middle of next year. So far, the Atlantic Crossing One (AC-1) fiber cable that it launched in February is ferrying Internet traffic between the U.S. and London. Mr. Cohrs explained that the system was designed with a loop architecture to guarantee full redundancy and to enable traffic rerouting during breakdowns. He was quick to point out that sub-sea cables break down less often than terrestrial ones, but neglected to add that they are also much more difficult and expensive to fix. To bring maintenance in-house and attempt to reduce the cost of repairs, Global Crossing recently acquired a cable maintenance business -- Global Marine, a subsidiary of Cable & Wireless (NYSE: CWP) -- for approximately $885 million. INTERNATIONAL CONNECTIONS Global Crossing plans to offer "one-stop shopping" to its incumbent, long-distance carrier, and new-age telecom customers. Rather than piecing together international networks by purchasing capacity from a variety of local entities, the company would offer one-stop services for any connection to 159 cities throughout the world. Global Crossing expects to complete its Pacific cable link to Tokyo, Pacific Crossing One (PC-1), by the end of December and the Europe branch in first quarter 2001. Global Crossing also announced the South American sub-sea and terrestrial network in March, which should be completed by the end of next year. The company has raised $3.5 billion in equity and debt to fund this build-out effort. According to Mr. Cohrs, the entire network is fully financed and most is under contract for development. Founded as a sub-sea cable business for the telecommunications market, Global Crossing transitioned into a global network carrier selling fiber capacity when it noticed the bandwidth demand and a lack of intercontinental connectivity. "We sell big open pipes," says Mr. Cohrs. And that's not all. Global Crossing plans on becoming a network services business that includes features such as ATM switching capacity and "a full array of bandwidth products." That's fine, but first the company needs to get its network up and running.