Corpus Christi Caller Times Caller.com - SW Bell buys 43 percent of Prodigy

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Tuesday, November 23, 1999

SW Bell buys 43 percent of Prodigy
Net company will be SBC's primary access provider
From staff and wire reports

SAN ANTONIO - Southwestern Bell Communications announced Monday that it will buy 43 percent of Prodigy and make Prodigy its primary Internet-access service provider for consumers and small businesses.
   SBC, the nation's largest local telephone service company, will offer Prodigy's service in markets covering about 100 million U.S. residents.
   Prodigy, based in White Plains, N.Y., will take over management of SBC's 650,000 Internet customers. An SBC spokeswoman in Dallas said SBC customers would still be able to choose other Internet service providers, such as America Online.
   For Corpus Christi customers, the partnership means customers who purchase Southwestern Bell's Internet services will get advanced technology, such as Instant Messenger, more quickly, said spokesman Michael Coe.
   SBC announced in October "Project pronto," a plan to provide high-speed Digital Subscriber Line service for Corpus Christi and about 80 percent of its customers nationwide by 2002. A DSL line could make Internet communications about 200 times faster, the company said.
   The Prodigy partnership will help SBC get its Internet-related products to market faster, and will let Prodigy reach more customers without having to pay local phone fees to SBC companies.
   "Think of pronto as a pipeline to send things faster," Coe said. "We needed a way to create things fast to send through it."
   The deal will also solidify Prodigy as a top-tier provider, and put it in prime position to absorb new DSL customers.
   "SBC will exclusively market Prodigy service through its extensive marketing channels with the commitment of delivering a minimum of 1.2 million new customers in the next three years to the Prodigy member base," SBC said in a prepared statement.
   SBC said that bigger high-speed Internet access customers, such as larger businesses, will continue to be served by SBC's current Internet operation. Financial terms were not immediately disclosed.
   San Antonio-based SBC recently announced plans to spend $6 billion to provide high-speed DSL, or digital subscriber line, service to 80 percent of its customers by 2002. Under the deal announced today, Prodigy would be able to sell its customers DSL service without paying fees to SBC for local phone service.
   The Prodigy service will be co-branded with SBC's regional brands, including Ameritech, Pacific Bell, Nevada Bell, SNET and Southwestern Bell, and with the new SBC Telecom brand in the 30 markets SBC will enter in the next 30 months.



Business writer Tara Copp and the Associated Press contributed to this report. Copp can be reached at 886-4316 or by e-mail at coppt@caller.com

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