Sprint Sets ION Targets

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Sprint Corp. is set to take on AT&T Corp. and the local
telcos with its rollout of an aggressively priced residential voice and high-speed-data
service package in three major markets this fall.

Officials said they would announce this week that the
carrier will launch the residential component of its ION (Integrated On-Demand Network)
strategy in Denver, Seattle and Kansas City, Mo., with plans to move next year into
Chicago, Los Angeles, Atlanta, Miami and other large markets.

Plans call for the use of digital-subscriber-line
technology to deliver a packetized combination of up to four lines of long-distance and
local telecommunications, together with fast Internet access, for a flat monthly rate of
between $100 and $150.

"We're still researching what the exact amount
will be, and it could vary from city to city, depending on local competitive
conditions," said Joan Jarrett, director for emerging markets in Sprint's
consumer group.

While the DSL equipment is capable of delivering services
at speeds of up to 8 megabits per second, depending on distance from the central office
and other factors, Sprint will set a single rate for all customers at 1.5 mbps downstream
and 684 kilobits per second upstream, spokesman Russ Robinson said.

Because signals are delivered in the cell-based packet
format of ATM (asynchronous transfer mode), customers can configure service through a
computer interface in whatever way suits them, using the high-speed-data channel to
deliver anywhere from one to four lines of voice-based services. The remaining bandwidth
goes to data transport, Jarrett said.

"Voice takes up very little bandwidth, so even with
the choice of four lines, the user will still get very high-speed data," she added.

The ATM packet switch/controller will cost users
approximately $200, Jarrett said, noting that Sprint will heavily subsidize the actual
costs in order to be competitive with cable and standard DSL modems.

Along with unlimited long-distance calling, the flat-rate
service will include features such as call waiting, voice mail and call forwarding,
including the ability to forward calls to wireless phones in instances where the customer
is connected to Sprint PCS, officials said.

The carrier will also offer enhanced applications such as
videoconferencing, distance learning and interactive games at additional charges.

In what promises to be the beginning of a furious
nationwide battle between long-distance giants, AT&T Broadband & Internet Services
has targeted Denver and Seattle as two of the 10 markets for voice-over-cable services it
will launch this year.

AT&T Broadband plans to take a different tack from that
of Sprint in its approach to pricing and bundling services, following the model it used in
its first market trial in Fremont, Calif., spokesman Mark Siegel said.

In Fremont, customers have a choice of up to four lines of
service combining expanded local and long distance in a variety of permutations that are
designed to beat the competing pricing combinations from Pacific Bell and long-distance
suppliers by at least 25 percent.

For example, Siegel said, two lines of unlimited local and
five hours of long-distance service cost customers $44.25 per month, with additional
long-distance use priced at 8 cents per minute.

"We launched the service May 12, and the initial
response has been excellent," Siegel said. "As we go to other markets, we may
adjust pricing to fit local conditions, but we'll proceed along the lines of what
we're doing in Fremont."

For now, at least, the bundling will not include the
high-speed-data service offered through @Home Network. "Our focus this year is on
building and testing the basic telephony architecture," he said.

The scale of service reach this year will be in the
thousands of customers, moving to the hundreds of thousands in 2000 and into the millions
in 2001 and beyond, Siegel added. Other cities targeted for the small-scale launches this
year are Portland, Ore.; Salt Lake City; Dallas; St. Louis; Chicago; Pittsburgh; and
another San Francisco Bay-area city in addition to Fremont, he said.