FCI, Qwest forge new pact

FaciliCom International Inc. last week struck a $25 million deal with Qwest Communications that extends the reach of each company's network.

FaciliCom, an international long-distance carrier that has gateways on the East and West coasts, plans to have gateway switches up and running in most European Union countries by the end of the year. FCI is paying Qwest for OC-3 (155.5 Mb/s) connections between three gateway facility pairs: London and New York; New York and Miami; and New York and Los Angeles.

Qwest will terminate FCI's high-volume traffic originating in Europe and other overseas locations throughout the United States, and Qwest's outbound traffic from the U.S. will be terminated at FCI's European facilities. The deal lasts 25 years.

"The problem on cable connections is still cost," said FCI President Walt Burmeister. "A long-term capital lease on the [network] asset lowers our cost."

The deal's structure gives each carrier similar benefits on opposite sides of the Atlantic, said Trent Spiridellis, international telecom analyst for NationsBanc Montgomery Securities.

"For FCI, it provides a fixed cost for [its] transmission capacity, which has an enormous impact on gross margins," he said. "For Qwest, it gives [it] a facilities-based partner in Europe and enhances the profitability of [Qwest's] traffic sent to that region.

WorldCom plans to offer local telephone service in select cities for resale by competitive local exchange carriers and resellers. By next year, the company expects to offer local switched and private line services in all domestic locations where it owns local facilities.

Digital Broadcast Network, which is building an ATM network interconnecting 28 U.S. cities, is now seeking CLEC and interexchange carrier certification in 18 states. The company, which offers specialized services such as video streaming live events, plans to obtain licenses in all 50 states.

Two CLECs focusing on digital subscriber line services last week announced new markets. Concentric Network Corp. expanded to the greater Los Angeles area and NorthPoint Communications expanded to the Boston area. Both already serve the San Francisco Bay area. NorthPoint also offers service in Silicon Valley and greater Los Angeles.

Net2000, a CLEC serving more than 2000 businesses in the mid-Atlantic region, has completed a $22 million second round of financing. The carrier will use the funds to continue building back office systems, open new offices and expand its sales force.