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WorldCom's Flat-Rate Phone Service

WorldCom officials said Wednesday they are offering flat rate local and long-distance pricing to companies that come aboard its WorldCom Connections offering.

The service, which the bankrupt company hopes to make their flagship offering to the enterprise market, offers converged voice and data services over one network, which officials said would simplify the process of distributing voice/data traffic.

While exact pricing is dependent on issues like the size the company, the equipment used, how many branch offices, etc., officials did release some ball-park figures. Small businesses, on average, would be charged $100 per line. The fee includes all the equipment involved, as well as local and long distance service. For the enterprise, officials were a little more sketchy, saying only the price was be assessed per facility and by the size of the router used at the company.

The timing on the service couldn't have been more ill-conceived, coming as it does only days after a major route table issue in its West coast routers knocked 20 percent of its customer base out of commission for hours and slowed the rest of the WorldCom network by as much as 40 percent.

But Natasha Haubold, a WorldCom spokesperson, said the outage last week hasn't had much of an effect. Attending a Voices on the Net trade show in Atlanta today, she said customer interest hasn't been dampened by last week's router problems.

"With any type of solution, you're going to have some problems," she said. "But people know WorldCom has a history of quality service, we're always re-examining our network and making improvements."

WorldCom Connection is the business-based service that's been in place in the residential community for a while now, The Neighborhood. The residential service, which offers flat-rate long distance and local phone service, is aimed at the local telephone company, the incumbent local exchange carriers (ILECs) like Verizon and SBC .

Until recently, the local telephone companies have been unable to offer long distance phone service as part of its requirements under the Telecom Act of 1996. Now that many of those local phone companies are getting the nod from state public utility commissions (PUCs) to offer long distance, long distance carriers like WorldCom and AT&T are now looking for ways to compete in a suddenly more-crowded market.

WorldCom is fortunate to have the largest IP network in the U.S., through its ownership of the UUNet network. While the carrier supports private branch exchange (PBX) equipment at the enterprise, officials are pinning their hopes to the next generation of telephony technology, session initiation protocol (SIP).

SIP allows for voice over IP and easier telephony management. Using a PBX-based piece of equipment at a building, for example, if there is a branch office move, it requires the physical change of settings, which can cost hundreds of dollars, said Haubold. With SIP, it's done virtually.

Little items like this are what WorldCom officials see as "simplifying" the voice and data network for customers using WorldCom Connection, according to Frank Grillo, WorldCom senior vice president of business marketing.

"It enables cost-efficient use of a company's access facilities, simplifies pricing and offers new communications features that not only benefit companies today, but also pave a logical migration path toward new communications technologies in the future."

WorldCom is slowly working its way through Chapter 11 bankruptcy. According to wire reports, the company was able to get out of a $185 million advertising deal with America Online this morning, and that its board of directors would almost certainly be replaced by WorldCom creditors.