BUSINESS NOTES.

GTE BUYS INTERNET BUSINESS: Greatly widening its grab for Internet business, GTE Corp. said Tuesday that it would buy BBN Corp. in a $616 million deal that would create a powerful new rival to AT&T Corp. and other Internet access providers.

Already the nation's largest local telephone company, GTE plans to use BBN's high-tech network to offer large businesses hungry for Internet access a single source for a broad array of telecommunications services.

BBN, based in Cambridge, Mass., helped build the modern Internet. It operates regional computer networks and offers services for businesses such as dial-up access, consulting and hosting of World Wide Web sites.

However, BBN doesn't have the money or the sales force to market these telecommunications services to companies on a national scale. Analysts said GTE - a unique hybrid of local and long-distance company - is well-positioned to attack a fragmented market, in which no one player has a major share.

?13- Associated Press 

ESPN TO LAUNCH SPORTS MAGAZINE: Walt Disney Co.'s ESPN cable sports channel said it will start a biweekly magazine aimed at taking readers away from Time Warner Inc.'s Sports Illustrated, one of the most profitable periodicals in the U.S.

ESPN Magazine will try to mimic the channel's often irreverent style, while capitalizing on its surge in popularity. The magazine is scheduled to debut early next year with an initial press run of 300,000, a network spokeswoman said. It could publish up to 40 issues annually with special editions.

ESPN, which Burbank-based Disney acquired when it bought Capital Cities/ABC in 1995, is the nation's No. 1 cable channel with more than 71 million households. Its Web site, ESPN SportsZone, is one of the most visited sites on the Internet, and it started a 24-hour sports news channel last year.

?13- Bloomberg News

INTEL SEARCHES FOR CHIP BUG: Intel Corp. tried Tuesday to figure out a reported math flaw in its Pentium II microprocessor as it prepared to launch the newest generation of its flagship computer chip.

Intel, the world's largest maker of computer chips, said it expected to learn whether the problem was genuine by the end of the week. The company also said it would figure out how the flaw might affect personal computer users and come up with a solution as soon as possible.

?13- Associated Press

BLOOD SUBSTITUTE ADVANCES: A blood substitute that looks like the real thing and carries oxygen just like it, but is safer and easier to store, has been successfully used in heart surgery patients, a company reported.

Baxter Healthcare Corp. said Tuesday it hopes to get permission to market the blood substitute in Europe within a year, and expects to apply for permission in this country in about a year.

The company said its product, called HemAssist, may be the end of a quest for artificial blood that dates to the 17th century, when doctors unsuccessfully tried transfusions with animal blood, wine or even milk.