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Covad unveils nationwide DSL service

The company will integrate digital subscriber line service with the networks of recent investors AT&T and Qwest.

Covad Communications will announce a nationwide remote access plan today, integrating for the first time the company's digital subscriber line service with the networks of recent investors AT&T and Qwest Communications International.

Covad, an aspiring high-speed communications carrier, is targeting its new TeleSpeed Remote service at small- to midsized businesses that want to connect remote offices in other cities, a first for the company.

Company executives said their new offering will allow businesses to save money by avoiding long-distance dial-up charges for using a modem to remotely access files. Other higher-speed options, ISDN or frame relay service, are typically too expensive for smaller businesses.

"This is dramatically less expensive than frame relay," said Eric Moyer, product manager for TeleSpeed Remote. "This makes high-performance networking available for the first time to anyone that wants remote access over long distance."

For example, a Covad user in New York will be able to tap his digital subscriber line (DSL) connection to access files on their Los Angeles-based company's network. Covad will send data traffic from the DSL line to the AT&T and Qwest networks via asynchronous transfer mode (ATM) and then reroute that traffic to a DSL line in another city where Covad offers service.

Previously, Covad only offered remote access service between offices within the same metropolitan area.

Covad offers DSL in eight metropolitan markets, with plans to expand into 22 markets by the end of the year. The company is expected to roll out service in Baltimore, Chicago, and Atlanta during the second quarter.

Like its competitors Rhythms NetConnections and NorthPoint Communications, Covad is offering small- and midsized businesses high-speed Internet and data services by leasing standard copper phone lines for the regional Bell operating companies (RBOCs).

The market opportunity is a hard one to pass up.

Data services among U.S. small businesses, those with 5 to 99 employees, is a $1.7 billion business annually, according to Cahners In-Stat Group. Likewise, data services for mid-sized businesses, those with 100 to 999 employees, accounts for $12.8 billion annually.

Rhythms, through its $30 million investment by MCI WorldCom, has access to a sizable nationwide network like Covad. But some analysts have been critical of NorthPoint for lacking a major fiber optic carrier partner.

Both Rhythms and NorthPoint are slated to go public later this year.