Wholesale Channel: Briefs

Posted: 11/2001


* eLEC Communications Corp. (, an integrated communications provider to small and medium-sized business customers, has entered into a wholesale agreement with National Tele-phone Exchange to provide eLEC’s local telephone services to NTE’s customers. NTE CEO Roger Ness anticipates 3,000 local lines would be added to eLEC’s platform this fall.

* Qwest Communications International Inc. ( announced in September it had signed a three-year, $108 million agreement to provide voice communications services to interXchange Limited over its 113,000-mile Macro Capacity Fiber Network.

The agreement will support InterXchange’s expansion into the global business and consumer market, a provider that has grown its voice delivery by hundreds
of millions of minutes over the last year, according to Qwest, which has provided services to the company since 1999.

* Williams Communications Group Inc. ( announced it had reached agreement with bankrupt fixed wireless provider Winstar Communications Inc. ( to amend a 25-year pact.

The companies first signed agreements in 1998. In a $400 million agreement, Williams expected to receive two percent of long-haul capacity on Winstar’s network. Winstar signed a $640 million agreement to lease dark fiber on William’s backbone network.

The initial agreement stipulated that Winstar would deliver 270 antenna sites by 2001, but, in the wake of financial troubles, the fixed wireless provider was unable to deliver. In April, Williams notified Winstar that it had failed to pay the carrier for leased long haul capacity.

Under the bankruptcy settlement, Williams will be allowed to use additional capacity on 200 existing wireless hubs, and cancel payments for 70 hubs that were not delivered. The pact also has been shortened to a 20-year agreement, according to an 8-K filing with the U.S. Securities and Exchange Commission (

Williams has agreed to provide services to Winstar for up to 18 months while Winstar is under bankruptcy protection. Payment for on-net services will be deferred, and off-net services must be paid in cash on a monthly basis. As part of the agreement, Winstar also forfeited any claims over the right to use two fibers on Williams’ backbone network, and it gave up its option to buy a right to use another two fibers.

Winstar filed for Chapter 11 bankruptcy protection in April after the company did not receive an expected loan disbursement from Lucent Technologies (, resulting in a missed interest payment.

On Aug. 1 Winstar announced measures to speed its exit from Chapter 11, including a workforce reduction. Winstar has retained The Blackstone Group ( as M&A advisor to assist with the potential sale or investments in the company.

In the 8-K filing, Williams stated it could not determine the financial impact of Winstar’s bankruptcy filing.

Wholesale Channel Links

3R Soft Inc.
Access One Inc.
Alaska Native Wireless LLC
Ameritech Corp.
BellSouth Corp.
CapRock Communications Corp.
Cisco Systems Inc.
Data Corp. Ltd.
EasyLink Services Corp.
Electric Mail Company Inc.
Federal Communications Commission
Frost & Sullivan
Gartner Inc.
Jamcracker Enterprise Inc.
Lightyear Communications
McLeodUSA Inc.
NextWave Telecom Inc.
Pacific Bell Corp.
Qualcomm Inc.
Qwest Communications International Inc.
SBC Communications Inc.
Sigma Networks Inc.
Telcordia Technologies Inc.
UBS Warburg Ltd.
Verizon Communications
Verizon Corp.
VoiceStream Wireless Corp.
The Yankee Group
Yipes Communications Inc.

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