Carriers binge on ISPs

If you can't make one, buy one. That appears to be the tactic some carriers are using when it comes to the Internet services market. Last week, both Frontier Corp. and RCN Corp. acquired Internet service providers.

For Frontier, which will acquire Sunnyvale, Calif.-based GlobalCenter for 6.4 million shares of newly issued stock, the move continues the company's transformation from a local telco serving New York and Minnesota to a full service provider.

With the GlobalCenter acquisition, Frontier will offer a variety of services such as complex Web hosting and high-speed private peering to more than 8000 business customers, including traffic-intensive Netscape, Yahoo!, USA Today and Electronic Arts. GlobalCenter also will add its 40,000 dial-up customers to Frontier's base of 50,000.

"It's an area we needed to bolster ourselves in," a spokesman said. "This gives us a 12- to 24-month head start."

In a second, unrelated deal, RCN will acquire both UltraNet Communications and Erol's Internet for $110.5 million in cash and stock. The deal makes RCN-which previously had concentrated on cable TV and telephone services-the largest regional ISP in the Northeast with more than 325,000 customers, almost all of them residential.

"We'll pick up some business customers through the UltraNet acquisition, but our focus will remain on the residential customer," said an RCN spokesman.