US West Promises Free Future Upgrades

DENVER (05/17/2000) - US West Inc. says it can deliver data services for teleworkers to 95% of customers in its territory as long as they are willing to wait for some of the faster options.

If they buy into the deal, US West will migrate these customers to higher speed services as that becomes possible.

Under a program called Digital Anywhere, the company promises to provide most customers with some form of high-speed access and to upgrade it to a faster service for free when it becomes technically feasible.

The fastest service will be asymmetric digital subscriber line (ADSL), which is capable of 7M bit/sec downloads, although that speed can be much less depending on the length and condition of customers' copper telephone lines. If a customer's telephone line does not support ADSL, US West will try ISDN-based DSL (IDSL) at 144K bit/sec. Failing that, it will try dial-up ISDN at 128K bit/sec.

US West's effort is more about marketing than technology because Digital Anywhere makes use of services the company already offers. The only new feature is the guaranteed upgrade, says Carl Garland, an analyst with Current Analysis in Sterling, Virginia.

"They are preselling DSL," Garland says. "They sell whatever they can right now to capture customers and upgrade later."

Still, the free upgrade is attractive, says Jon Day, director of Global Infrastructure for Novell Inc. in Provo, Utah. With the program, Novell can buy high-speed access for employees without worrying about buying them new equipment and paying new installation fees if faster technology becomes available in their area, Day says.

US West says that about 45% of customers served by switching offices that support DSL can get ADSL. Adding ISDN and IDSL to the mix pushes that coverage to 95%, the company says. To be eligible for Digital Anywhere, customers must order 25 or more high-speed lines.

Compared with SBC Communications Inc.'s $6 billion Project Pronto, the US West effort pales. SBC says it will provide ADSL services to 80% of its customers by 2002 by pushing its fiber network closer to customer sites. By doing that, SBC reduces the number of customer telephone lines that are too long to support ADSL.

US West has no formal upgrade program on that scale. Instead, to provide fast access links, the company will provide a mix of services.

US West Chairman and CEO Sol Trujillo says that even without a formal program to push fiber closer to customers, he expects an increasing number of customers to be able to get DSL services as the technology itself improves.

"Two to three years ago, ADSL had a 9,000- to 1,000-foot reach. Now that is 15,000 to 18,000 feet," Trujillo says.

US West has been testing other technologies to provide high-speed access to customers who cannot be reached over traditional telephone lines. Included is a 2M bit/sec wireless service that uses radio frequencies in a wave band that requires no license, he says.

The company will also consider bidding on wireless licenses to be auctioned later this year. Trujillo notes that Qwest Communications may also be interested and that could affect US West's decision. Qwest and US West have agreed to merge, and that deal could be completed by July.

The decision will be based in part on how much it costs US West to support a service. "With all services we provide, it's a matter of the economics of the platform," Trujillo says.

US West: www.uswest.com

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