MCI in February requested a two-month extension on its deadline to emerge from bankruptcy. The Ashburn, Va., company said the extension would give it time to complete its filings with the Securities and Exchange Commission. MCI said it has obtained all necessary approvals from regulators and creditors to emerge from bankruptcy.

Meanwhile, MCI and AT&T Corp. have agreed to settle claims the phone giants made against each other, including allegations by AT&T that MCI routed calls through Canada in a scheme to avoid paying access fees to local phone companies. The companies have submitted the agreement for approval to the U.S. Bankruptcy Court for the Southern District of New York. As part of the agreement, MCI has dropped a contempt of court motion filed against AT&T.

AT&T and Onvoy Inc. also have reached an agreement to settle claims AT&T made against Onvoy for allegedly conspiring with MCI to avoid paying access charges, sticking AT&T with the bills. Specific terms of the settlement were not disclosed.

MCI’s biggest rivals accused the No. 2 long-distance phone company of avoiding millions of dollars in access charges by manipulating or abolishing call detail records and routing long-distance traffic over trunks dedicated to carry only local phone calls. AT&T accused MCI of fraud and racketeering in a lawsuit filed last fall, claiming it was paying millions of dollars in access charges to rural phone companies when its archrival was responsible for the bill. MCI said an internal probe revealed no foul play. The U.S. Attorney’s Office and the FCC are investigating AT&T’s allegations.

Level 3 Communications Inc. is expanding its portfolio of transport and infrastructure services with the addition of wavelength and Ethernet services for metropolitan area networks. The new services are available in 36 European and U.S. cities where Level 3 already offers metropolitan private line and metropolitan dark fiber services. Level 3 says the new services - (3)Link Metro Wavelength and (3)Link Metro Ethernet - support metro applications, including IP connectivity, traffic aggregation, converged networks, long-haul extensions and data traffic exchange.

Fibertech Networks LLC announced plans in late February to build fiber-optic networks in Wilmington, Del., and Stamford, Conn., bringing to 16 the number of cities in which it will operate. Fibertech says anchor tenant agreements with customers to connect several locations within these cities fueled the expansion. Fibertech, a privately held company based in Rochester, N.Y., says the networks should be operational by the middle or end of the year.

PPL Telcom, a Pennsylvania-based transport provider serving wholesale carriers and large enterprises, is expanding its IP services, say carrier services executives at the company, which provides broadband connections to telecom companies, ISPs and large businesses and institutions. Charles Boddy, manager of marketing for PPL Telcom, says the company will target ISPs, carriers and enterprise customers for its new IP services, which range from a T1 to a full Gigabit Ethernet circuit. The IP service was set to debut in March in eight metro areas in Pennsylvania within the reach of PPL Telcom’s regional OC192 network.

NEON Communications Inc., a carrier’s carrier in the Northeast and Mid-Atlantic regions, has lit a new route from New York City to Washington D.C. The new route accelerates NEON’s plans to build into Tier 2 and Tier 3 cities south of New York, the company says. NEON says it has added 27 new locations along the route, from ILEC central offices to carrier hotels to enterprise customer facilities in Baltimore, Philadelphia, northern New Jersey, northern Virginia and Washington D.C.