Looks like growth for EBS

HOUSTON (Dow Jones)--In the latest update of Enron Corp.'s (ENE, news, msgs)
bandwidth trading activities, the company's chairman said Tuesday that it has
completed about 90 trades of telecommunications bandwidth.
Speaking at the Dain Rauscher Energy 2000 Conference, Enron Chairman Ken Lay
talked about the current status and futures plans the company has for
bandwidth trading and broadband services.
Asked what kind of company Enron is, Lay gave an answer that shows the recent
expansion of the company's business strategy beyond energy. Enron is still
basically "an energy and broadband company," he said.
While energy is still the source of most of Enron's revenue, Lay's answer
underlines the growth potential it sees in broadband services and bandwidth
trading. A number of Enron officials have been quoted in the last year as
saying that, in a few years, it could be making as much money from those
areas as it now makes from its lucrative natural gas and power businesses.
Enron plans to spend $600 million-$650 million this year and about the same
amount over the next two to three years on broadband and bandwidth trading,
Lay said. It will spend more during that time if necessary.
In fact, the company is planning to sell energy assets around the world in
emerging markets that aren't growing quickly enough to meet Enron's
standards. Proceeds will be deployed into businesses like broadband and
bandwidth trading, which are growing more quickly, he said.
In pioneering bandwidth trading as a commodity, Enron's 90 bandwidth deals
put it far ahead of competitors in that nascent market area. El Paso Energy
Corp. (EPG, news, msgs) officials have said they have done 5-10 bandwidth
trades this year. Companies like Williams Communications Group (WCG, news,
msgs) won't talk about the number of bandwidth trades they have made.
Bandwidth is the capacity to move data between two points on a
telecommunications network.
Enron will finish deploying its domestic telecommunications network by the
end of this year, Lay said. Some of the fiber-optic network will be lit, or
made operational, this year with the rest to be lit later.
The company has four bandwidth trading pooling points completed in New York,
Los Angeles, Las Vegas and London. Enron's current plans call for a total of
13 pooling points.
Bandwidth trading pooling points are facilities where telecom carriers can
connect to each other to allow data to flow from one carrier to another,
facilitating bandwidth trading.
Enron plans to begin delivering movies to home via broadband connections in
December as part of its deal with Blockbuster Video and a number of telecom
carriers.
The deal is a 20-year exclusive, worldwide deal with a potential contract
value of more than $1 billion to Enron, according to materials the company
handed out at the conference.
By Michael Rieke, Dow Jones Newswires, 713-547-9207, michael.rieke@wsj.com
Quote for referenced ticker symbols: ENE, EPG, WCG, WMB

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