Tele-Communications Inc. Ahead of Schedule on Cable Upgrades

Tele-Communications Inc. is making progress on its cable infrastructure upgrade, which will enable two-way capability on over 90 percent of its network by the end of 2000. The company is ahead of schedule according to officials, who claimed this in a joint teleconference with AT&T, a potential buyer. The upgrade is a crucial step for TCI to provide AT&T with the capacity to enter the local telephone and Internet access markets.

Key Takeaways:

• TCI's cable infrastructure upgrade is ahead of schedule, with 92-95 percent of the network expected to have two-way capability by the end of 2000.
• The upgrade will provide AT&T with the capacity to enter the local telephone and Internet access markets.
• TCI has already spent $400 million to $500 million of the $1.8 billion allocated for the rebuild.
• The company plans to embed a cable modem in every digital set-top box it sells in the future.
• AT&T expects significant synergies from the combination, including reducing customer churn and offering attractive service bundles.
• AT&T's earnings per share assumptions are around $4.60 in 2001 and $5.60 in 2002.
• TCI's president, Leo Hindery, stated that the company's plan is comparable to that of other major cable companies in the industry.
• All metropolitan areas will have 750-MHz plant, suburbs will have at least 550-MHz plant.

Statistics:

• 92-95 percent of TCI's network will be able to handle two-way data and voice transmission by the end of 2000.
• TCI has already spent $400 million to $500 million of the $1.8 billion allocated for the rebuild.
• $900 million will be remaining by the time the deal closes.
• 11 million customers already have access to digital video.
• AT&T expects earnings per share assumptions of around $4.60 in 2001 and $5.60 in 2002.

Sources:

• Newsbytes
• Tele-Communications Inc. (TCI)
• AT&T Co. [NYSE:T]
• United States (U.S.A.)