Sprint outlines international strategy

Sprint Corp. will build out its global IP (Internet Protocol) network across Europe and Australasia as part of its revamped international strategy, the US telecommunications company announced Tuesday. Sprint plans to expand its IP network to connect 15 cities in 13 European and Asian countries by the end of the year, said Wil Wilhelm, Sprint vice president and general manager for the company's international's offshore operations in a telephone interview with the IDG News Service.

Additionally, that expansion will increase its reach to 35 European, Asian and Australian cities by the end of 2003, Wilhelm said. The company already offers dedicated IP services to 30 countries and Internet VPN (virtual private network) services to 60 countries.

"Thirty percent of our revenues comes from our broadband offerings, we expected that to grow to 50 percent of worldwide revenues from broadband by 2003," Wilhelm said.

Wilhelm would not disclose just how much Sprint plans to spend on the expansion. "It is more of an incremental investment rather than a single figure. We will be cash-flow positive in the near term, but we're not giving out grand numbers like some other companies have," Wilhelm said.

Sprint competitor Cable & Wireless PLC (C&W) has announced it would spend US$3.5 billion on building out its global IP network. Last May, the U.K.-based C&W announced the completion of the first phase of its global IP network and in October announced it is investing an additional 960 million pounds (US$1.4 billion) over 5 years in building an optical fiber IP network in Japan. Along with the IP network build out, Sprint is also planning to increase its staff internationally fourfold, Wilhelm said. Again, Wilhelm declined to cite specific numbers, such as the number of new hires or the current level of staff, saying that the information was proprietary.

The first new IP node -- or connection point -- that Sprint plans to build will be in its European headquarters in London, with 14 nodes following in Paris, Frankfurt, Amsterdam, Milan, Brussels, Stockholm, Copenhagen, Dublin, Hamburg, Munich, Sydney, Singapore, Tokyo and Hong Kong, Wilhelm said. He could not give a projected date for the completion of the London node.

"We are between offices (in London). We're now in two buildings but we will consolidate our headquarters for our international operations in the very near future," Wilhelm said.

Among its other plans for international expansion, Sprint's network backbone will be upgraded in Europe, from 2.5G bps (bits per second) to 10 Gbps, by the end of the year, Wilhelm said.

Furthermore, Sprint will also build new data centers in Asia and Europe. There are currently 11 data centers in the US though Sprint is in the process of building more US data centers, Wilhelm said. "The data centers are the flagship product that we've had historically and we'll announce the details of the Europe and Asia data center build-out by the end of 2001," Wilhelm said.

The idea is to offer Sprint customers the IP network backbone in combination with data centers and managed services, Wilhelm said. "It is a singular wholesale approach and we have a very large US base to build from. We want to use our current IP service as a jumping board for other IP services. Our goal is to support the evolution of the applications while evolving a top quality IP network that can carry voice, video and data: a seamless global network."

Wilhelm was reticent when asked to name who Sprint considers to be its biggest competitors, though that list is generally considered to include C&W, AT&T Corp., Infonet Services Corp., France Télécom SA/Equant NV and the company Sprint tried, but failed to merge with last year, WorldCom Inc.

"We have a single platform approach and I'm not sure if I'd compare us directly to that pack. Most don't have the Tier 1 IP network for the market. I have trouble finding someone who can bring all of the elements that we have to the party, be it legacy of experience, the customer base, range of services or IP backbone. They all fall down in one or more of those areas," Wilhelm said. "Some retailers have patched together networks in a higgildy-piggildy fashion."

As part of this seamless global network, Sprint will also "continue to invest in strategic cable systems as they come online. We are leveraging the cable systems that we already have in place worldwide," Wilhelm said.

Wilhelm predicted that the one of biggest challenges Sprint faces in building out its global IP network will be keeping up with customer demand. "It is a challenge we will look forward to having," Wilhelm said.

He also pointed to the possibility that it may take some doing on Sprint's part to find the number of new employees with "the right skill sets" that the company is looking for. Then there is the fact that Europe is an unusual combination of a pan-European market and a grouping of very individual countries with varying markets.

"We are trying to be as sensitive to local markets conditions as we can," Wilhelm said.

With that in mind, Wilhelm and other Sprint officials had just concluded a meeting with Patricia Hewitt, minister for small business and e-commerce in the U.K. Department of Trade and Industry earlier in the day. "We were impressed with steps she seems to be making" to bring broadband services to the U.K. market, Wilhelm said.

Analysts have said that the U.K. is at least six months behind the rest of Europe in terms of developing broadband infrastructure, and U.K. government officials, including Hewitt, have been accused of lacking the foresight needed to regulate and promote growth in the U.K. broadband market. "The U.K. market will really open up once there is a way to get really ubiquitous Internet access," Wilhelm said.

Sprint, in Westwood, Kansas, can be reached at +1-913-624-3000 or http://www.sprint.com/.

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