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UniDial Communications and Bell Atlantic Sign
Largest-Ever Resale Agreement
UniDial to Resell 200,000 Bell Atlantic Local Lines in Return
for Steep Discounts on Wholesale Rates
May 11, 1999
LOUISVILLE, Ky./NEW YORK -- In the largest-ever resale contract
signed by Bell Atlantic and a wholesale customer, UniDial
Communications has agreed to resell at least 200,000 Bell Atlantic
telephone lines over five years to business customers throughout the
regional Bell's service area.
In return for this commitment, Bell Atlantic has agreed to substantially
increase the wholesale discount on those lines. Also, as part of the
contract, UniDial -- a telecommunications reseller serving businesses --
will use Bell Atlantic's network to handle regional toll calls for its
Under the agreement, UniDial will expand its presence to offer local
phone service to businesses throughout Bell Atlantic's region, which
includes the states of Delaware, Maine, Maryland, Massachusetts, New
Hampshire, New Jersey, New York, Pennsylvania, Rhode Island,
Vermont, Virginia and West Virginia, as well as Washington, D.C.
UniDial currently offers local service in eight of these states, mainly in the
northeast, through its newly acquired subsidiary, Metracom. In June,
Metracom will take on the UniDial name, and much of the company's
expanded local service operation will be based in Metracom's current
"At UniDial, we consider local service a critical part of our future as
a full service communications provider," said J. Sherman
Henderson, III, president and chief executive officer of UniDial
Communications. "We've built our business on the idea that
customers want a truly integrated product set for local, long distance and
data services. Local service is an essential piece of the puzzle to truly be a
one-stop shop for our customers."
As part of the deal -- valued at approximately $300 million over five years
-- Bell Atlantic will increase the wholesale discount currently provided to
UniDial by 10 percent in the first year, 13 percent in the second year, and
15 percent during each of the following three years. The discounts are
contingent upon UniDial meeting annual volume commitments for resale
of Bell Atlantic phone lines.
"This agreement provides for a substantial increase in margins that
will enable UniDial to continue to build its business in a financially
responsible manner," said Henderson.
To date, Bell Atlantic has sold 725,000 lines to approximately 100
companies that resell telephone service to their own customers.
"This agreement demonstrates an increased commitment from Bell
Atlantic to the local resale business," said Ernie Kelly, president of
the Telecommunications Resellers Association. "Bell Atlantic's
action can serve as a model for the rest of the industry. I urge other
regional Bell companies and GTE to follow Bell Atlantic's lead by taking
the wholesale business more seriously and opening their local markets to
Jack Goldberg, president of Bell Atlantic's Telecom Industry Services,
said: "We're very excited about the prospects of working with
UniDial on an agreement this large. UniDial is a proven performer in the
telecommunications industry and we're committed to helping it further
expand to meet its goals.
"Local service resale is a viable business and Bell Atlantic intends to
be a leading wholesale provider," said Goldberg. "This deal
demonstrates once again that Bell Atlantic is making every effort to work
with UniDial and other resellers to promote the kind of competition that
will move the whole industry forward."
UniDial's services currently are sold through a network of more than 400
UniDial Authorized Agents and more than 120 UniDial direct sales
representatives in 17 cities across the U.S.
UniDial, in conjunction with its vendor partners, offers an integrated suite
of telecom services to its 80,000 small- and medium-sized business
customers. Founded in 1993, UniDial is a privately held company
headquartered in Louisville, Ky., and was recently ranked 19th in Inc.
Magazine's list of America's fastest growing private companies. For more
information about UniDial, visit its web site at www.unidial.com.
About Bell Atlantic:
Bell Atlantic is at the forefront of the new communications and information industry.
With 43 million telephone access lines and nine million wireless customers worldwide,
Bell Atlantic companies are premier providers of advanced wireline voice and data
services, market leaders in wireless services and the world's largest publishers of
directory information. Bell Atlantic companies are also among the world's largest
investors in high-growth global communications markets, with operations and
investments in 23 countries.