Telergy and group of affiliated companies seek FCC exempt telecom company status for each under Public Utility Holding Company Act. Telergy companies directly or through respective telephone operating subsidiaries provide facilities-based integrated broadband telecom services and fiber capacity throughout U.S., primarily in Northeast. Companies will use conduits, facilities and right-of-ways purchased from Consolidated Edison, Jersey Central Power & Light, Metropolitan Edison, Niagara Mohawk Power, Pa. Electric, others.

France’s Vivendi swapped its 55% stake in AOL France for stake in AOL Europe worth $725 million and possibly redeemable for cash within 2 years, move it said would help its wireless venture Cegetel. Vivendi will show gain of $575 million on asset it acquired for $150 million. It said 2/3 of transaction’s value would be used to finance Cegetel’s 3rd-generation buildout using its UMTS license in France. Vivendi agreed not to start rival ISP in France for 3 years and companies reached variety of cross- marketing agreements. Move gives AOL full control of its 4.5- million-subscriber European operation once it buys out Germany’s Bertelsmann.

Pegasus TransTech said it installed redundant data system in Madison, Wis., for Transflo.com service that mirrors images and data stored in Tampa. Service allows company to have backup data in case one server is down.

U.S., European Union (EU) and Greece informed World Trade Organization (WTO) that they had reached “a mutually satisfactory solution” to problem of pirating of American movies and TV programs by Greek broadcast stations. In releases issued by U.S. Trade Representative (USTR) Robert Zoellick and EU late Thurs. and Fri., 3 parties said they finally settled dispute after more than 10 years of complaints by American film industry about rampant copyright violations. Relieved MPAA officials, who had pressed for end to problem, said settlement resolved worst case of over- the-air TV piracy in world by far. “I think the problem is solved now,” MPAA Trade & Federal Affairs Vp Bonnie Richardson said. “Obviously, we'll keep an eye on it.”

ICO-Teledesic said it signed deal with CCI International to build spectrum-efficient satellite communications system.

Movie and TV writers “are being completely unrealistic” in stalled Writers Guild of America (WGA) negotiations with studios as strike deadline nears, Disney Pres. Robert Iger said. “You have got to wonder what is in their minds,” he said at Thurs. news conference at ABC hq in Burbank, Cal. Jeffrey Katzenberg of DreawWorks contended that if studios acceded to writers’ demands it would bankrupt production industry in 3 years: “That is an irrefutable fact.”

Eutelsat privatization is one step closer to reality as company announced it elected supervisory board in Paris. Board members are elected for 3-year terms and were selected ahead of July 2 privatization. Elected were: Jean-Jacques Damlamian, group exec. Vp-Development Div., France Telecom, chmn.; Maurizio Cappelli, Dir.-Broadcast & Multimedia Service Div., Telespazio, vice chmn. Board members: Boris Antoniuk, dir.-gen. and CEO, Russian Satellite Communications Co.; Enzo Badalotti, CEO, Telespazio; Jean-Marie Culpin, dir.-satellite networks planning & strategy, France Telecom; Imre Duro, technical dir.-Hunsat; Wieslaw Dzierzak, Dir.-Satellite Service Centre, Polish Telecom; Oliver Froissart, vp-mergers & acquisitions, France Telecom; Jan Geldmacher, exec. vp-international networks & joint ventures, Deutsche Telekom; Andrew Gibson, head of satellite investments, British Telecom; Lorenzo Morretta, head of international participations, Telecom Italia; Hannes Peintinger, head of Dept. for International Networks and Satellite Communications, Telekom Austria; Antonio Santos Mendes, senior consultant, international organizations, carrier services & network planning, CPRM; Jeremy Simons, head of consortium investments, British Telecom; Mark Smith, managing dir.-bcst. & satellite communications, British Telecom.

Qwest turned to General Accounting Office (GAO) for relief last week after losing agency-level protest at General Services Administration (GSA) over bridge contract for FTS 2001 program. Qwest filed protest with procurement law control group of GAO over most recent extension contracts awarded to AT&T and Sprint, incumbent bidders for original FTS 2000. Qwest had filed challenge at GSA in Dec. (CD Dec 18 p2), contending sole-source interim contracts carried rates that on average were 25% higher than those for original FTS 2000 contract and that GSA should have bid work competitively. Interim contracts were awarded in Dec. after GSA missed target for shifting federal agency telecom traffic to FTS 2001 awarded to Sprint and WorldCom from old FTS 2000. Qwest raised same concerns with GAO last week as it did in GSA agency protest. Agency protest official Donald Suda said GSA decision not to seek competitive bids for interim contract was business judgment, upholding GSA decision. Qwest told GAO its protest was based on contentions that: (1) GSA violated procedural mandates of Competition in Contract Act (CICA) and Federal Acquisition Regulation. Qwest argued GSA didn’t prepare justification document for deciding not to seek competitive bids until after contracts were awarded. (2) Agency couldn’t justify sole-source awards on basis of “unusual and compelling urgency” because it knew for at least 4 months beforehand that more service coverage under FTS 2000 would need to be awarded. “Yet it failed to conduct any planning for such a procurement,” Qwest said. (3) GSA failed to demonstrate prices in bridge contract extensions were fair and reasonable. Because CICA requires this demonstration, GSA’s action “renders the bridge contracts voidable.” In particular, Qwest took aim at GSA arguments that company couldn’t provide national long distance service under federal telecom contract because it didn’t yet have FCC approval to provide interLATA services in former U S West region. “GSA’s position misses the central point: Qwest is permitted to team with a long distance provider capable of providing service in Qwest’s ‘in-region’ territory and thus submit a proposal fully responsive to GSA’s requirements,” Qwest told GAO. Qwest Govt. Systems Div. Senior Vp James Payne said Fri. company disputed GSA’s characterization of company’s compliance with Sec. 271. Teaming arrangement could have been made with contract partner for states in which long distance approval hadn’t been received yet, he said. “To say that ‘you are not allowed to provide services in all 50 states,’ that is going way beyond the rules of the FCC,” Payne said. “It’s bad policy.” GSA wasn’t available for comment.

European Commission cleared proposed merger of Equant and France Telecom, following similar approvals by FTC and Dept. of Justice in U.S. Equant, which operates international voice and data network, said it expected transaction to close by midyear.

FCC seeks comment on Qwest application to discontinue telecom facilities in 38 Ariz. exchanges. Qwest said it would transfer 38 exchanges to Citizens Utilities Rural Co. as part of sale between 2 companies. Collectively, 38 exchanges serve 158,000 access lines, with 300 physically located in Utah. Application said planned transfer would have no known effect on service provided in those exchanges. Comments are due April 13.