Cassidy spells out telecom impact on Colorado; there'll still be room for "Mom and Pop".

GOLDEN, Colo.--(BUSINESS WIRE)--June 20, 1996--Sam Cassidy is an evangelist -- an evangelist for telecommunications.

Specifically, Cassidy believes that telecommunication, whether it be a video signal, a television signal, or a fiber optic cable, is a technology that makes time and distance irrelevant. Moreover, he believes that through the use of telecommunications, Colorado companies can compete on an international level.

Cassidy, a former state senator and Lt. Governor, is president of the Jefferson Economic Council, a public/private partnership which acts as the economic development agency of Jefferson County.

Cassidy pointed out that the recent deregulation of telecommunications will have a profound effect on Colorado.

Said Cassidy: "Certainly, there's going to be an increase in the provision to telecommunication infrastructure and service for the Front Range urban and suburban areas. Competition among providers -- and these are going to include telephone companies, cable companies and probably lots of folks we've never heard of before -- is going to be fierce.

"And, for the Front Range, this means lower prices and better telecommunication services. That's capitalism and competition at its best. Watch out for particularly sharp competition for the business of companies located in the strip that runs between downtown Denver and the Denver Tech Center."

While this is good news for the Front Range, he noted, deregulation is going to have a negative impact on rural areas and increase the economic disparity between the Front Range and the rest of Colorado.

This is the way Cassidy sees the situation:

-- Telecommunications companies are not going to make technology investments in areas that don't have the population to justify the expenditure without incentives. The profit motive still rules.

-- In the past, the rural areas have been dependent on government regulations for telecommunications quality assurance and lower prices. Urban revenues have supported rural pricing. Now, with competition for lucrative urban markets, rural telephone providers will not want to continue to cost shift, because to be competitive in the urban areas, they will want to reduce costs as much as possible.

In a sense, the big telecommunications companies -- because they were able to provide services to the urban areas -- have been subsidizing the rural markets. Those days are over. The only alternative is a fund contributed to by all urban competitors which could offset the high costs of providing rural services, while leveling the playing field in lucrative urban markets.

But, the telecommunications deregulation bill (signed early this year) has deferred to regulators the responsibility of designing the details of their new competition and access charges and high cost funding issues have not been decided. Until they are decided competition will be stalled. If these issues are ultimately litigated the delays will deprive Colorado business of the head-start its economy would otherwise enjoy in this new competitive world of telecommunications providers.

Said Cassidy: "We cannot ignore dramatic change. Telecommunications represents dramatic change. As Lt. Governor, my office focused on our telecommunications future and how Colorado could take advantage of the information revolution. Whether our concern is rural or urban or both, communities need to do some hard thinking about strategies that provide communities with the telecommunications infrastructure so essential to a healthy economy."

In general, Cassidy predicts a bright future for Colorado through the creative use of telecommunications.

"As I've often noted, time and distance become negligible factors when you use telecommunications tools. Distance disappears. Because of that, people are free to choose where to live and work. Given that choice, Colorado will always be a winner. In essence, Colorado can be a center of world business with Colorado companies actively participating in the global marketplace."

Cassidy said he's often asked about the future of small, "mom and pop" businesses that won't -- or can't -- use the tools of telecommunications.

"There will always be room for 'mom and pop.' The emphasis has to be on selecting a circumscribed, localized market and servicing that market to the hilt. An example: Food companies can now access products from all over the world and buy at the best prices because of daily fluctuating data banks.

"But, there will always be room for a business that delivers homemade soup or sandwiches or has the ability to do personalized catering. If the service is personalized and localized, with an emphasis on quality, 'mom and pop' will not only survive -- they'll flourish in the age of information.

"In addition, 'mom and pop' can become even more specialized and produce unique products and services with the highest quality and sell to small niches in a global market. Instead of having to compromise their product to fit the needs of a local and limited marketplace, they can now market over a broader territory and find the customers who need special products or services."

CONTACT: Sharon Kent Freeman Inc.

Gerry Freeman or Lisa Metzger, 303/232-3870