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SBC Eyes $500M DSL Push

SBC Communications may spend between $300 million and $500 million to expand its broadband coverage area, executives said at its annual investor conference.

Currently about two-thirds of the San Antonio, Texas, company's 57 million local lines can accommodate digital subscriber line broadband. SBC wants to up that total to three-quarters.

SBC spokesman Selim Bingol wouldn't give details, saying only that the company "is committed to maintaining our leadership in terms of DSL deployment and subscriptions."

The initiative may depend on a Federal Communications Commission rule that exempts SBC and others local carriers from leasing DSL lines to competitors at cut rates. The measure is still being considered.

SBC, which operates in 13 Midwestern and Western states, has argued that the old regulations provided a disincentive for capital improvements.

Talk of investment by SBC, comes amid a flurry of technology and business moves by broadband players. Last week, Verizon Communications cut its DSL monthly charge to $34.95 per month in a bid for new customers. The move is prompting competitors to examine their pricing.

And in March, New York-based Verizon said it would expand the number of lines equipped for delivering broadband access by nearly 30 percent. The goal is to make its DSL service available to 10 million homes by the end of the year.

Likewise Denver-based Qwest will invest $75 million to expand its DSL reach by 20 percent.

Pumping money into network improvements could blunt competition from cable companies, which offer broadband connections through coax cabling. It is also welcome news for telecom networking equipment makers, who have endured two years of sluggish sales as carriers delayed or canceled orders.