Qwest to open its lines in the West to 4 rivals

Agreements set up regulatory approval for long-distance service

January 16, 2001|By BLOOMBERG NEWS

DENVER - Qwest Communications International Inc., which bought local phone company U S West Inc. last year, agreed yesterday to open its phone lines in 14 western states to four rival providers of high-speed Internet service.

Those companies are Contact Communications, Multiband Communications Inc., New Edge Networks Inc. and NorthPoint Communications Inc. The agreements replace interim contracts Qwest signed with the companies in April, spokesman Steve Hammack said.

Qwest, which sells phone, data and Internet services, gained more than 25 million customers and a 14-state western regional telephone network when it bought U S West for $44 billion. The company said it must prove to regulators that its local markets are open to competitors before it can provide long-distance service to customers in those states.

Each of the four companies will pay Qwest $4.89 a month to use the phone lines, Hammack said. After about seven years, the monthly charge will drop to $3.89, he said.

Qwest said it expects to gain approval from state and federal regulators to provide long-distance service in all 14 states by the end of 2002, Afshin Mohebbi, Qwest's president of worldwide operations, said on a conference call.

Denver-based Qwest also said the company plans to spend $9.5 billion this year to improve its services and add customers. Qwest had $9 billion in capital investments last year.

In December, Qwest said it was on track to sign up 250,000 subscribers for its high-speed Internet service and 800,000 wireless customers in 2000.

It expects to double those numbers by the end of this year, the company said.

Qwest shares fell 88 cents to $46.63 on Friday. They declined 4.9 percent last year.

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