Sprint plans landmark upgrade

Tuesday, June 2, 1998 | 11:58 a.m.

NEW YORK -- Sprint Corp. is raising the stakes in the telecommunications wars, offering its customers the chance to simultaneously talk on the phone, receive faxes and connect with the Internet using a single phone line.

The service could be available to Las Vegans as early as the end of the year.

The nation's third biggest long-distance phone company expects the new service unveiled today would eliminate the need for customers to have multiple phone lines.

Sprint said the new system would reduce its costs for delivering typical voice phone calls by more than 70 percent and cut the costs of a video call to below what it costs for a typical long-distance call today.

Sprint Chairman William T. Esrey said customers' monthly bills would stay about the same, but they would get far more sophisticated service -- including Internet connections at up to 100 times faster than a conventional modem.

Steve Dykes, director of communications for Sprint's local division based in Kansas City, said the company is considering how it would introduce the new technology to Las Vegas. Dykes said Sprint, which is the dominant local phone company in Southern Nevada, will meet with businesses that transfer large volumes of data over phone lines to determine how soon there would be a need for the new technology in Las Vegas.

Under Sprint's announced timetable, installations for large businesses would occur by the end of the year while small businesses and residences could be on line by the end of 1999. Dykes said the company's discussions with local businesses will determine how quickly the technology becomes available here.

"We don't have a complete time frame in terms of where and when exactly the service will become available," Dykes said. "We are building a broadband metropolitan network in Las Vegas that should be available by the end of the year."

Sprint shares jumped $1.06 1/4 a share to $73 in early trading today on the New York Stock Exchange.

Sprint's announcement said the new service results from a combination of technological advances rather than a single technology and results from five years of confidential work.

It expects to start making the service available to large businesses later this year and expand it to businesses of all sizes by the middle of 1999. It should be available to residential users in late 1999.

"This truly is the Big Bang that expands the universe of what telecommunications can do in our homes and businesses," Esrey said in a statement.

Sprint has already invested more than $2 billion in its own network and has been testing it privately with business and consumers for the past year, Esrey said.

It will need approval from various local phone companies to hook its new network to local phone systems. That could lead to difficult negotiations, particularly since Sprint says the new network will serve as its basis for competing with local phone companies.

The Wall Street Journal said Sprint must also persuade customers to pay $200 for a device that will act as a meter on monthly traffic over the system.

Sprint hopes to make the new service available in 36 major markets this year and a total of 60 markets next year.

Cisco Systems is providing key hardware for what is being called the Integrated On-Demand Network, with Bellcore providing the central software. Sprint will sell the service through RadioShack, which already sells Sprint mobile telephone service.

Several big companies have already committed to using the Sprint service including Hallmark, Silicon Graphics, RadioShack parent Tandy and Ernst & Young LLP, the announcement said.

Sprint, which trails AT&T Corp. and MCI Communications Corp. in the long-distance business, is the first to announce a new telecommunications system on such a large scale.

There have long been promises of full-service networks offering everything from video on demand, electronic shopping and more. But telephone companies need greater capacity and more efficient transmission technologies to send the huge amount of data.

Carriers now use different transmission technologies for voice and data. Keeping lines open to go online ties up circuits.

Experts said an integrated network is needed to combine voice, video and data and pipe them over the same lines.