VERIZON RESTORES SERVICE TO N.Y. STOCK EXCHANGE
Verizon replaced and repaired thousands of communications circuits in time to support reopening of N.Y. Stock Exchange (NYSE), not only restoring service but doing so on one of heaviest days of trading, Verizon Co-Chmn. Ivan Seidenberg said Mon. He said 2,000-3,000 workers from throughout N.Y. state “worked day and night” over week-end and “essentially rebuilt our entire network in southern Manhattan,” damaged in last week’s terrorist attack on the World Trade Center. In addition, “hundreds of contractors” were helping dig up streets and haul out rubble, he said. Telecom capacity to NYSE is nearly 100% restored, he said. All but 1,000 of 15,000 circuits that normally provide communications were in operation now, more than enough to meet normal demand, Seidenberg said.
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Seidenberg said much work still had to be done, most importantly rebuilding West St. central office that still was in bad shape and not handling traffic. Not only do many customers obtain direct service from West St. but some 3.5 million data circuits travel through it, Verizon Vice Chmn. Lawrence Babbio said. By rerouting, 1.4 million of those circuits have been restored and more are coming up every hour, Babbio said. “The network is performing remarkably under these conditions,” he said.
It’s still hard to work in West St. office because of rubble from collapse of nearby 7 World Trade Center building, Seidenberg said. Debris is covering manholes and company wasn’t allowed until Sun. to enter “vault” where cables enter West St. building. Seidenberg said workers were evacuated 3 times during weekend: “We're fighting day in and day out for access to our facilities.” Mon. morning, firemen still were using 7th floor windows in West St. office to direct hoses at still-smoldering 7 World Trade Center next door, Babbio said. Many residential and small business customers in downtown Manhattan were without service although many hadn’t been allowed to return to their buildings yet so they didn’t know it, Babbio said.
Verizon hasn’t released estimate yet of how much it’s costing to clean up and rebuild but Seidenberg said he didn’t expect expenditures to be reflected in higher rates. Federal govt. has promised some disaster relief funding and company has insurance that will cover much of cost, he said. In 7-10 days, most people will have temporary service but a lot of that is “Rube Goldberg” work, temporary patches and rerouting on odd paths, Seidenberg said. Permanent rebuilding will take much longer, Babbio said.
Telecom stocks did better than many Mon., despite impact of attacks on networks and media companies. Biggest stock price loss by major media company was 18.4% by Disney, with several telecom firms even showing modest gains. Biggest gainer was High Speed Access Corp., up 16.7% to still-modest 21 cents. Other gains included Nokia, up 12.3%; Cox, up 2.9%; SBC up 2%; Deutsche Telekom up 1.2%. Other big losers included Covad down 14.2%, News Corp. down 13.4%, Amazon down 13.2%, Viacom down 13%, AOL Time Warner down 12.8%, Nextel down 11.7%. Others traded in narrower range.
Bright spot among general decline of tech stocks was providers of videoconferencing equipment and services as investors bet on large drop in business travel. Shares of ACT Teleconferencing spiked up 50% Mon. morning as market opened ending day at $7.35 (up 47%). Shares of nearly all companies in communications niche rose: Wire One Technologies closed at $5.25 (up 22.7%), Polycom $25.45 (up 33%) and its merger partner PictureTel, $5.17 (up 12.9%). Wire One said Fri. it would offer free videoconferencing service for disaster relief from N.Y. facility and 30 other corporate locations. Company will offer services with Polycom and Picturetel. Videoconferencing vendors reported demand surged up to 50% last week due to 2-day flight ban that left travelers stranded across country. Many analysts expect businesses to increase use of videoconferencing due to flight limitations and other travel inconveniences expected to last for months. -- Edie Herman, Mike Feazel, John Spofford
Terrorism Crisis Notebook…
“My regulatory philosophy and goals don’t seem very important” in wake of last week’s events, FCC Comr. Abernathy told FCBA lunch Mon. She said she was struck by importance of communications during crisis, including maintaining telephone network reliability and broadcast and cable coverage of events. Abernathy said Internet also proved to be “great resource” during crisis, which she said emphasized importance of moving quickly on guaranteeing emergency agencies’ access to adequate spectrum and importance of FCC role in ensuring reliability of telecom networks: “This brings home the importance and pervasiveness of communications in our society. It is our job to make sure confidence in communications is not misplaced.” Abernathy did briefly repeat her basic regulatory goals, including following lead of Congress, relying on market and industry, operating FCC as service agency. Biggest worry, she said, is long delays in FCC decisions, citing 10 months to decide on Fox-Chris-Craft merger. Petitions for reconsideration and review often fall into “black hole” at agency, Abernathy said, even though many of them are routine. She said petitions that didn’t raise new issues should be handled within about 45 days, and she was asking Chmn. Powell to move FCC in that direction. Abernathy also pressed for computerized FCC tracking system that would quickly show everyone whether proceeding was being handled at division, bureau or 8th- floor level, and said there should be more detailed written reports of ex parte discussions. -- MF
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White House Press Secy. Ari Fleischer dodged question at press briefing Mon. about possibility of increased FCC action to limit public comment about Sept. 11 terrorist attacks. He was asked about reports that callers to radio shows had endorsed attacks, and about whether FCC should act, as govt. did during World War I. Fleischer’s reply: “I'm not going to comment on things that I haven’t heard.”
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Financial impact on communications infrastructure could reach $6 billion following attacks on N.Y. and Pentagon, Computer Economics said Fri. in early estimate of damage. Full extent of damage to facilities in Manhattan may take “several weeks to determine,” said research firm: “Clearly, many facilities have been rendered inoperative. In addition, the underground installations of Manhattan have and will continue to be damaged as the cleanup and reconstruction takes place over the next several years.” Total cost to restore information technology (IT) and communications capability will reach $15.8 billion, it said. Of total cost, immediate impact of attack will be $1.7 billion, with more than 25,000 IT and telecom workers toiling to restore or assure service continuity. Repair work and immediate equipment replacement will continue for several weeks. Contractors and service companies also will provide support for in-house repairs. Long-term impact to end-user organizations is estimated at $8.1 billion, company said. Banking and financial service companies targeted in N.Y. attack are among most IT intensive industries. About 100,000 information intensive workers will be relocated to temporary and new permanent facilities. Long-term costs include acquiring and installing telecom and data communications support and replacing servers, computers and other equipment. -- JS
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Broadcast equipment maker Avid Technology said Doug Gowell, its dir.-new mkt. development, died in crash of United Airlines Flight 175 into No. 2 World Trade Center Tues. He is survived by wife, son, daughter.