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Sprint Makes $200 Million Investment

Sprint Corp. is upgrading and expanding its network with a $200 million contract to Lucent Technologies, Inc., it was announced Thursday.

The contract marks Sprint's commitment to labor on after its failed merger attempt with Worldcom, Inc. had analysts predicting the company's eventual demise.

The agreement gives Sprint, the nation's second largest long-distance carrier behind AT&T Corp. with 20 million business and residential customers, enhanced IP offerings to accommodate the increased demand for high-speed Internet access and services like virtual private networks and streaming media.

Don Hallacy, Sprint Internet president, said the contract with Lucent ensures its customers can take advantage of the recent improvements in data transport.

"This is another example of our commitment to maintain a world-class network capable of providing fast, reliable access to the Internet and providing businesses with secure remote access solutions," Hallacy said. "More and more, businesses are exploring how the Internet can improve their ability to communicate with a mobile or remote workforce utilizing Internet VPN solutions. Through improved network management efficiencies, Lucent's technology and experience will help us ensure that our rapidly growing network continues to deliver the highest quality to our customers."

Sprint's purchase of next-generation equipment and software gives the carrier cutting-edge technology to streamline its current traffic network.

Lucent's APX 8000 multiservice access switch gives the carrier a single platform to integrate dial up, ISDN, voice over IP, fax over IP and VPN services. It's 2,688 ports per chassis gives Sprint the opportunity to defray the cost of the switch by reselling extra ports to Internet service providers and businesses, called port wholesaling.

The purchase of Lucent's Softswitch Internet Call Diversion gives Sprint the ability to divert data traffic from the circuit switches on voice networks. The Signaling System 7 gateway is part of Lucent's 7R/E next generation network solution.

Alex Winogradoff, Gartner's Dataquest telecommunications and networking group principal analyst, said in a statement released last month that Sprint's abandoned merger talks with Worldcom opened the door to a takeover.

"In all likelihood Sprint will not exist as an independent entity beyond mid-2001 at best," Winogradoff said.

"Competitors, potential suitors and corporate raiders are already hard at work. The value of Sprint's individual businesses are an open book requiring limited due diligence, and the sum value of its individual parts could well exceed Sprint's value as a whole. Sprint can either hold out for a company with ambitions to keep it whole, or separate its business into stand-alone units for eventual sell-off to maximize shareholder value."



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