Posted: 11/1997

By Bob Titsch Jr.

Putting together this segment was supposed to be an
entertaining diversion from the rigors of producing the largest
issue ever of PHONE+. It was to be a fun, breezy
exploration of the people who are shaping the competitive long
distance landscape, which we define as the resale segment
thriving off of wholesale services.

Rather, it turned out to be a brain-numbing exercise,
consisting of several staff meetings (and a few arguments),
numerous interviews, exchanges of perspective and dealing with
the occasional hubris of people who deem themselves among the
most important individuals in the industry–if not the world. But
this list is not about "important." It’s about a number
of people who are effecting change in the competitive long
distance industry. To this end, we’re not running through the
list of Big Three officers. Nor are we listing all of the people
who run companies with annual revenues exceeding $100 million.
Further, we’ve held off on mixing in the viewpoints and
contributions of attorneys (with one exception) and international
players, as we have special editorial plans for them in upcoming
issues.

Quite simply, we’ve chosen 25 individuals who are–in our
view–playing a significant role in shaping the competitive long
distance industry. We admit they are by no means the only people
impacting the business and deserving of a mention, but for those
of you who are not listed and believe you belong, you probably
should have returned our calls.

BERNARD
J. EBBERS
MONIKER: President and CEO, WorldCom

STATUS: From 1978 to
1990, everybody wanted to be Bill McGowan, the founder of MCI who
litigated everything and flouted all the rules. Today, everybody
wants to be Bernie. Clearly, his model of growing through
aggressive and strategic acquisition has earned him the respect
of industry colleagues and, more importantly, Wall Street. Who
else could purchase the Internet networks of CompuServe and
America Online, announce the acquisition of Brooks Fiber
Properties and make a bid for MCI inside of three weeks? Brooks
Fiber is a fait accompli, significantly increasing WorldCom’s
local facilities and number of access lines.

At press time, the MCI acquisition was less certain (BT and
some MCI upper management were said to have been apoplectic about
how to kill the deal. We can only assume that MCI, in its
characteristic fashion, will launch a dozen lawsuits). If the
deal gets done, though, WorldCom will dominate the Internet
backbone business and be well on its way to becoming an
integrated supercarrier. If the deal doesn’t get done, Ebbers
will get where he wants to go anyway. And that’s a good thing for
the competitive long distance community, given WorldCom’s
commitment to the wholesale segment.

HEARD AROUND THE WATER COOLER: The former
college basketball player who made the Canadian Olympic team is
modest and unassuming, but extremely candid and direct. The New
York Times reported that when Ebbers called MCI Chair Bert
Roberts Jr. at 8:30 a.m. on Oct. 1 to make his offer, Roberts had
not yet reached his office. "A few minutes later, when the
two actually talked, Ebbers recalled, ‘I told him if he joined
WorldCom, he’d have to come to work earlier.’"

BILL BARR
MONIKER: General Counsel, GTE Corp.

STATUS: A former U.S. attorney general who
fought the "War on Crime" under former President George
Bush, Bill Barr has been the chief architect of GTE’s litigation
strategy. Barr is credited with freeing GTE from Bell company
constraints stipulated in the Telecom Act, which allowed his
employer immediate entrance into the long distance market. He
also beat the FCC’s interconnection order in the U.S. Court of
Appeals for the 8th Circuit in St. Louis, giving state regulatory
commissions authority to set prices CLECs will pay incumbent LECs
for wholesale services and unbundled elements.

HEARD AROUND THE WATER COOLER: Very smart,
articulate and pithy, Barr is the leading spokesperson for ILECs.

* NOTE: Watch for our special feature on the most influential
telecom attorneys. We took creative license in choosing Barr for
this segment because he is considered in most competitive long
distance circles as the Prince of Darkness.

RALPH
SWETT
MONIKER: President, CEO and Chairman
of the Board, IXC Communications

STATUS: In a past life, Ralph Swett
grew Times Mirror Cable Television from 16,000 subscribers to 1.3
million subscribers before it sold for $2.3 billion. More
recently, he’s molded a microwave technology company into one of
America’s largest suppliers of digital transmission and long
distance services to the telecommunications industry. IXC is
undergoing a tremendous nationwide fiber build and quickly
becoming one of the dominant carriers’ carriers in the industry.
Since introducing wholesale switched long distance services in
1995, the company has captured a sizable share of the market
(PHONE+ estimates approximately $30 million per month and
climbing). This year IXC made a huge investment in ATM/frame
relay infrastructure to meet the increasing demand for broadband
capacity and, significantly, will not compete with customers for
data communications business. Swett also is positioning IXC as
the carriers’ carrier for cable companies.

HEARD AROUND THE WATER COOLER: The former
college golfer is a subtle, calm, very low-key man who conducts
business like he plays golf: very methodically. He plays one shot
at a time, keeping his eye on the ball yet always thinking
long-term.

MICHAEL FRANZ
MONIKER: President, Wholesale
Services Group, Sprint

STATUS: Competitive long distance companies
usually characterize the Big Three as Sybil-like when talking
about their commitment to the wholesale channel, but Franz has
done a great job of running Sprint’s wholesale program.
Historically, the Big Three have had trouble determining whether
resellers were fish or fowl. Understandably, the Big Three would
prefer resellers take business away from their competitors and
not themselves. Despite the inherent problems with channel
conflict, Franz has kept Sprint focused on the wholesale
business–to the competitive long distance industry’s benefit.

HEARD AROUND THE WATER COOLER: He’s a very
competitive golfer and sometimes referred to by wholesale
customers as the Great White Shark (He does resemble Greg Norman,
incidentally).

H.
BRIAN THOMPSON
MONIKER: Chairman and CEO, LCI; Chairman,
CompTel

STATUS: Thompson was with MCI in the early
days, a protigi of Bill McGowan’s and seemingly his heir
apparent. But for whatever reasons, Bert Roberts Jr. was ordained
instead. So Thompson took the reigns at LCI in 1991 (then called
Litel) when the company was bleeding profusely. Since then, he’s
turned it into the fifth or sixth largest long distance company
(depending on how you tabulate the data) and one of the fastest
growing carriers in telecom. Under Thompson’s direction, LCI has
been one of the more aggressive companies getting into the local
business, too. Rumors are rampant that Sprint wants to acquire
LCI and appoint Thompson president of the merged company. Others
say AT&T will try to buy LCI and bring him in as CEO of the
merged company. Stay tuned.

HEARD AROUND THE WATER COOLER: The son of an
outspoken union organizer in Chicago, Thompson grew up in the
rough and tumble. He’s a former Navy Seal and bomb dismantling
expert, and so perfectly trained for dealing with telecom issues.
Associates and competitors alike say he’s brilliant, charming,
extremely charismatic and, well, disarming.

DAVE
RUBERG
MONIKER: Chairman, President and CEO,
Intermedia Communications Inc.; Chairman, ALTS

STATUS: The newly elected chairman of the
Association for Local Telecommunications Services (ALTS) is
aggressively growing through network buildout and acquisitions a
dominant full-service provider along the Eastern seaboard and
expanding west. In possessing a sophisticated frame relay network
that ranks among the top three with AT&T and MCI, the company
primarily concentrates on data applications, but it’s becoming
more and more of a factor in the long distance business as well.
Under his direction, the company is very focused on the new
digital technologies to provide a full range of services.
Intermedia already is moving some voice traffic over a frame
relay platform and should not be underestimated as a powerful and
serious competitor to the more traditional long distance
companies as it continues to expand nationwide.

HEARD AROUND THE WATER COOLER: A displaced
engineer from New York with a technical and managerial background
, Ruberg is as sharp as they come, unassuming and a very nice
guy, despite being surrounded by Floridians and Georgians.

JOE
NACCHIO
MONIKER: President and CEO, Qwest; board
member, CompTel

STATUS: The former president of AT&T’s
Consumer Communications Services division joined Qwest in January
of this year. Prior to that he spent 26 years at AT&T,
holding positions in network operations, engineering, marketing
and sales, and earning a reputation as a consumer specialist.
Today,he oversees Qwest’s state-of-the-art nationwide fiber
build, carriers’ carrier strategy, retail positioning and
strategic deals (the ICG and LCI agreements, and the recent
acquisition purchase of Denver-based ISP SuperNet, for example).

HEARD AROUND THE WATER COOLER: The fellow
from Brooklyn is described as sometimes irreverent but always
able to back it up and very, very fast on the draw. He abhors
flying.

KENNY
TROUTT
MONIKER: President and CEO, Excel

STATUS: Three years ago, Excel was a $30
million company. After the acquisition of Telco Communications
Group closes, the company will have a combined annual revenue of
more than $2 billion.

Obviously, with the acquisition of Telco, Troutt is re-making
the company into a carrier. He grew Excel through multilevel
marketers who primarily signed up family and friends for
residential service, but the acquisition of Telco, which has a
substantial commercial sales force, has put Excel on the front
lines of the battle to win lucrative commercial accounts. Already
salespeople with other carriers are reporting that Excel reps are
offering their commercial customers extremely low switched rates.
Troutt recently beat out several other parties for the talents of
Jim Smith, formerly the president of CompTel. The new vice
president of law and public policy is in the process of hiring
staff to establish Excel’s Washington beachhead–further evidence
of Excel’s evolution.

HEARD AROUND THE WATER COOLER: Troutt grew up
poor in the projects of East St. Louis, earned a football
scholarship and worked his way through college before making and
losing a bundle in the oil and gas business. He is a tremendous
leader, a motivator and a perpetual optimist with the charisma of
an Oral Roberts (we’re not exaggerating).

JOHN
BARNETT
MONIKER: President, Wholesale Services
Division of WorldCom

STATUS: With WilTel owning the lion’s share
of wholesale business (approaching $2 billion, according to
ATLANTIC*ACM), Barnett exerts tremendous influence over the
competitive long distance industry. Roy Wilkens is a tough act to
follow, but Barnett flanked Wilkens on both the pipeline and
telecommunications sides, and he’s up to the task. He has
tremendous international experience, having previously been
responsible for the development and operations of WorldCom’s
international markets for data products and voice services.

HEARD AROUND THE WATER COOLER: Barnett is
intense, extremely competitive, committed to the job, demanding
of himself and others, and a total workaholic, sometimes leaving
his associates voice-mail messages in the wee hours of the night.

ANTHONY
CASSARA
MONIKER: President, Carrier Services,
Frontier

STATUS: Tony Cassara is responsible for
overseeing the company’s corporate-wide wholesale business
segment that combines local and long distance wholesale and
carrier services groups. He led the charge for supporting
resellers in the wake of several acquisitions and a difficult
consolidation period. More recently, he instituted an unusually
flexible policy to work with resellers on a case-by-case basis to
develop solutions that help them create and sustain a competitive
advantage.

HEARD AROUND THE WATER COOLER: Cassara is an
outdoorsman who takes great pleasure in fishing and camping with
his family, a pro sports enthusiast, and he is described by
colleagues as one of the most skilled negotiators they’ve ever
observed.

JOHN
FLEMING
MONIKOR: Executive Vice President of Sales
and Marketing, IXC Communications

STATUS: Being responsible for the
implementation of IXC’s national switching network, Fleming
played a huge role in giving birth to a new underlying carrier
option for resellers in 1995 and continues to lead the way with
acquiring new wholesale customers and meeting their needs. He
began his career at MCI, and held high-level positions at IBM’s
Satellite Business Systems and Times Mirror Communications Corp.
before joining IXC, so he’s got somewhat of an eclectic
background from which wholesale customers can draw.

HEARD AROUND THE WATER COOLER: Fleming
occasionally has time to play behind the wheel of his speedboat
on Lake Austin, but basically he eats and sleeps IXC. He also
just might be the industry’s most eligible bachelor.

RICHARD
P. NESPOLA
MONIKER: Founder, President and CEO, The
Management Network Group Inc.

STATUS: The former senior-level executive
with MCI, Sprint and Telesphere Communications is quietly
affecting most everyone making their living in the competitive
long distance community. He’s a brilliant general business
consultant who has helped numerous long distance companies
develop both strategic and tactical plans in the areas of market
assessment, customer care, acquisition, retention and product
positioning. TMNG is a global telecom consulting firm, employing
130 consultants who have spearheaded numerous engagements in
deploying infrastructure, processes and systems required to
support successful market entry. The company also works closely
with venture capital and banking firms in evaluating and
recommending investment opportunities within the global telecom
industry.

HEARD AROUND THE WATER COOLER: Nespola is a
principled and prince of a guy, admired and endeared by Roy
Wilkens, for whom he often consulted.

GORDON
"DON" HUTCHINS, JR.
MONIKER: President and CEO, G.H. Associates

STATUS: Hutchins, too, quietly impacts the
competitive long distance segment as a general business
consultant. The former MCI executive and CEO of LDX Net–which
owned and operated one of the three independent, good-sized
networks in the mid-80s before WilTel acquired it–was a founder
of TMA, which became TRA. Hutchins has served on TRA’s board,
assisted in the planning of its conferences and consulted copious
resellers on capital concerns, financial and strategic business
development.

HEARD AROUND THE WATER COOLER: The youth
soccer coach is well connected, very smart, approachable and the
"go-to" guy for a lot of resellers.

GENEVIEVE
MORELLI
MONIKER: Executive Vice President and
General Counsel, Competitive Telecommunications Association
(CompTel)

STATUS: CompTel’s legal
eagle, Morelli has been the guiding hand of the association in
virtually every policy position it has taken for the past seven
years. She has helped chart the course for CompTel–a powerful
public policy advocate and representative of IXCs before
Congress, the FCC and the courts. Morelli also happens to be a
terrific builder of bridges among companies with diverse
interests. Thus, her contribution to the competitive long
distance industry has been and continues to be considerable.

HEARD AROUND THE WATER COOLER: Some board
members feel Morelli is more valuable doing what she is doing
rather than being distracted by the day-to-day schmoozing that
comes with being president of the association. But if she doesn’t
get the nod to step in and fill Jim Smith’s shoes, CompTel is
likely to lose her altogether.

CLARK
MCLEODS
MONIKER: Chairman and CEO, McLeodUSA Inc.

STATUS: One of the first entrepreneurs to
form a long distance resale company after divestiture, McLeod is
an industry pioneer. After selling Telecom USA (formerly
Teleconnect) to MCI, he founded McLeodUSA, a CLEC, in 1991. With
McLeodUSA’s recent acquisition of Consolidated Communications
Inc., McLeod is building a blueprint for the highly touted super
regional carrier and will be a formidable competitor to long
distance companies.

HEARD AROUND THE WATER COOLER: Charismatic
and a very quick study, McLeod was first to market integrated
local and long distance services in numerous small to mid-size
markets in the Midwest–long before the term "one-stop
shop" made its way into the greater telecom consciousness.

HERMAN
HENDERSON
MONIKER: President, UniDial; Chairman, TRA

STATUS: Henderson pioneered the concept of
taking the agent program to a new level of professionalism. Many
companies working through the agent channel sign up almost
anybody who wants to be an agent to see what they can sell. Not
Henderson. He provides a tremendous level of direct support that
includes recruiting agents who are willing to pay a substantial
franchise fee (up to $25,000) and spend a week attending UniDial
University for schooling in the UniDial method of resale.

HEARD AROUND THE WATER COOLER: His energy and
showmanship are limitless, and Henderson has great expectations
in his new role as TRA Chair. He’s looking to raise TRA’s
conference and trade show visibility through means that include
getting high-profile speakers: Don Shula, for one, and possibly
someone on the level of Colin Powell, for another. If anyone can,
Henderson will.

_{DR.
JUDY REED SMITH}
MONIKER: CEO, ATLANTIC*ACM Inc.

STATUS: When the doctor
is in, everybody listens. Reed’s reports have not only been among
the most useful for the hard and insightful information they
provide, they’ve helped give credibility to the industry. Her
research efforts regarding industry history, growth and trends
are highly regarded in every sector. Reed’s groundbreaking
research is the basis for her consulting practice, which offers
financial planning and operational support in addition to
strategic research. The firm’s data has been published in The
Wall Street Journal, Kiplinger’s Personal Finance Magazine, PHONE+,
X-CHANGE, Knight-Ridder News Service, America’s Network,
Teleprofessional and Bacon’s, to name a few.

HEARD AROUND THE WATER COOLER: The gracious
Smith has a sense of adventure that is underscored by a
willingness to stroll into uncharted territory–pretty much
characteristics that describe many in competitive long distance.
Perhaps that understanding stems from a time in Smith’s own
youth, during which she and a friend once vacationed in then
Saigon during the Vietnam War. Of her own pedigreed, designer
education–Smith says she had to get a Ph.D. from Harvard so she
could win an argument with her lawyer husband.

FRANK
SCARDINO
MONIKER: President, Atlas Communications

STATUS: Many industry veterans say that when
you wanted to get into the resale business years ago, you had to
talk to Scardino. He got his start with AT&T, later sold one
company for millions and created another that’s reportedly doing
more than $100 million after just two years. He is very well
connected and a student of tariffs, which makes him particularly
tough to sell to (from an underlying carrier’s perspective) and
even tougher to compete against.

HEARD AROUND THE WATER COOLER: He manages to
pull off extraordinary deals with underlying carriers and always
gets that extra quarter cent. Some colleagues refer to him as the
Godfather.

_BILL
OBERLIN
MONIKER: President and CEO,
MIDCOM Communications

STATUS: First some history: Allnet was on
death’s doorstep in 1990 when the former Cable & Wireless
executive–in tandem with Mark Moses and John Zrno (both
retired)–began to work his magic. In five years, the company
jumped to $800 million in annual revenues and its stock price
rose from 18 cents to $66 a share before Frontier acquired it.
Today Oberlin is hard at work putting together MIDCOM, a large
reseller in distress before he took the reigns. With a new switch
network, the acquisitions of Phoenix Network and TransNational
Communications, Oberlin appears to be well on his way to
performing another miracle.

HEARD AROUND THE WATER COOLER: The man who
cooked up the most spectacular turnaround in the industry’s
history is also a heck of a chef.

LAURA SCHER
MONIKER: CEO, Working Assets, and board
member, TRA

STATUS: She’s been a pioneer in the billing
and affinity program arena for a number of liberal causes and
continues to set the template for others who create affinity
programs to attract business on idealogical grounds. The programs
she creates are far more philanthropic than most in the industry
and managed by a board of directors that predetermines the causes
supported. Working Assets invented an option on invoices that
allows customers to round up to the nearest dollar on behalf of
particular causes.

HEARD AROUND THE WATER COOLER: Scher was also
one of the first long distance resellers to get in the local
resale game and took a lot of punches early on, which helped
TRA’s local resale counsel in its efforts to guide other
resellers.

_LARRY
JAMES
MONIKER: Chairman, President
and CEO, U.S. Long Distance (USLD)

STATUS: James is very active in CompTel and
was one of the strongest supporters of the lobbying effort for
the telecom bill. He built a very strong management team and a
very good company at USLD. It’s hard to say what happens next for
James–USLD is in the process of merging with LCI in a $331.8
million stock transaction. He’ll see through the transition and
almost certainly figure heavily into the industry in some other
reincarnation.

HEARD AROUND THE WATER COOLER: The big-time
golfer recently was pictured in Texas Business magazine with a
Lincoln Navigator that saluted their commitment to excellence.

ERNIE
KELLY
MONIKER: President, Telecommunications
Resellers Association (TRA)

STATUS: He was the first employee hired by
TRA and has since steered one of the major and fastest-growing of
the telecom trade associations toward the next century with
successes that include a merger with the National Wireless
Resellers Association (NWRA), an all-time-high membership and a
professional staff position dedicated to local resale programs
and services. Kelly is a relentless advocate of resellers, and it
shows. A major part of what he does is visit members in the home
offices of their companies–and Kelly manages to hit 50 or 60
each year.

HEARD AROUND THE WATER COOLER: Kelly may seem
all business to those who don’t know him, but don’t let his poker
face fool you. In his youth, Kelly once performed in a rock and
roll band.

DANIEL
BORISLOW
MONIKER: President, Tel-Sav Inc.

STATUS: Borislow has built a tremendous
switch network. He knows the business well and has carved out a
very successful niche for himself by playing off the AT&T
resale game, which he’s been in for a long time. He just acquired
Fairchild, one of the most successful shared tenant services
companies in the nation and will probably parlay that
distribution channel into a local service play.

HEARD AROUND THE WATER COOLER: Tel-Save may
eventually be a sensible acquisition target for AT&T, which
could use the company’s new shared tenant play for local
positioning.

_MIKE
NEWKIRK
MONIKER: President, BTI

STATUS: Captain Newkirk is at the helm of
what industry analysts say is a heads-up company making all the
right moves, from a reseller that bought capacity from AT&T
and MCI to a switch-based long distance carrier. More recently,
the company has added wireless, Internet, nationwide paging and
local offerings to its service mix, shaping itself as one of the
new and the few integrated phone companies.

BTI recently merged with its sister company–a CLEC named
FiberSouth–has begun wholesaling extra capacity, and, now is
eyeing the cable industry. Also, BTI recently closed a $250
million financing package to fund expansion plans.

HEARD AROUND THE WATER COOLER: Newkirk
happens to be one of the funniest and most likable fellows in the
business. With stogey clenched in mouth, he often will drive a
golf ball more than 300 yards and still bogey the hole.

DONALD
BURNS
MONIKER: President and CEO, Telco
Communications Group

STATUS: In three years, Telco’s revenues have
skyrocketed from $45 million in 1994 to $429 million in 1996–for
a compound annual growth rate of 209 percent. Further lighting
the skies, the company recently entered into a definitive merger
agreement with Excel Communications, which itself has shown
growth of similar proportions.

HEARD AROUND THE WATER COOLER: Burns is
fearless, a fantastic spin doctor and a consummate salesman. As
one observer notes, "If he and Kenny Troutt join forces and
sell, there’s not a bridge in America that’s safe."