Report: Telstra to reach up to Level 3

Telstra and its Hong Kong-based partner Pacific Century Cyberworks Ltd. (PCCW) will shortly extend their Reach Internet backbone joint venture into Japan, South Korea and Taiwan, according to a report in The Australian newspaper Wednesday.

The partners will sign a deal with ailing U.S. cable company Level 3 Communications Inc. under which Reach will supply US$80 million funding for Level 3 to complete its 320G bps (bits per second) Tiger North Asia cable system. In return, it will receive capacity on the cable and licenses to operate services in the three Asian countries, the newspaper reported.

The cable already links Hong Kong and Japan, and will extend to Taiwan in the first quarter of 2002 and South Korea in the second quarter, according to the report.

Level 3 will become the third partner in Reach and will also help Reach connect to the U.S. through an 11 percent stake it currently holds in a Japan-U.S. cable, the newspaper reported.

Debt-laden Level 3 has spent much of this year staving off financial disaster, while the Reach joint venture has achieved little since being formed in February this year.

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