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SBC inks deal to spur high-speed strategy

The local phone giant agrees to sell Concentric Network's high-speed Internet services around the country in a deal that will eventually give SBC a nationwide broadband footprint.

SBC Communications agreed today to sell Concentric Network's high-speed Internet services around the country, a deal that will ultimately give the Baby Bell a nationwide footprint.

Within its own territory, the local phone giant is one of the largest digital subscriber line (DSL) providers and plans to offer high-speed services outside of its region in coming years. So far, however, it doesn't own high-speed Net facilities outside of its own 13-state area.

DSL is a technology that allows high-speed Internet and ordinary voice traffic to share a single telephone line. It is the primary competitor to cable modems, which still have a lead in the consumer market.

Today's deal marks a growing trend in the communications world as local phone giants pair off with high-speed Net start-ups to increase their reach. Last week GTE signed a deal with a trio of DSL companies to give the firm a nationwide presence.

The big local phone companies all are spending considerable time and money to become the dominant high-speed Net players in their own regions, but have little experience offering services outside their territories. Some smaller companies, like Concentric or NorthPoint Communications, already have relationships with local network providers. Partnering with these smaller companies allows the local phone companies to further their expansion strategies.

As a part of its recently concluded merger with Ameritech, SBC Communications agreed to expand its services into at least 30 new markets nationwide. Today's agreement is the first move in that strategy.

SBC's high-speed Net services will initially be marketed to businesses and telecommuters. Because SBC doesn't own a network in its new coverage areas, prices for service are expected to be higher than those offered in SBC's home region.

The Baby Bell recently announced a $6 billion investment effort aimed at making DSL available to 80 percent of the population within its home 13-state area.