William Blair & Company Initiates Coverage of Five Leading Competitive Local Exchange Carriers

Apr 10, 2001, 01:00 ET from William Blair & Company, L.L.C.

    CHICAGO, April 10 /PRNewswire/ -- Citing an enormous U.S. market for
 wireline telecommunications service, William Blair & Company today initiated
 research coverage of five competitive local exchange carriers (CLECs) the firm
 believes are well positioned to serve the booming industry -- Allegiance
 Telecom, Inc. (ALGX $12.75) at Strong Buy; McLeodUSA Incorporated (MCLD $8.06)
 and Time Warner Telecom Inc. (TWTC $34.45) at Buy; Focal Communications
 Corporation (FCOM $6.02) at Long-term Buy; and XO Communications, Inc. (XOXO
 $3.52) at Hold.
     Analyst Kenneth M. Kotylo noted that wireline telecom service constituted
 a $220 billion market in 1999, with local and long-distance services
 representing $112 billion and $108 billion, respectively.  Further, Kotylo
 noted that as of June 30, 2000, CLECs served only 6.7% of U.S. local telephone
 lines, a figure he believes could soar to 40% over the next 10 years.
     "We believe strong industry fundamentals, excellent long-term growth
 prospects, and attractive valuations provide a compelling opportunity for
 investors interested in the CLEC sector," Kotylo said.  "However, investment
 selectivity is paramount.  To reap the rewards of this volatile sector,
 investors must focus on companies with experienced telecom management, strong
 funding, and a record of outstanding execution, in our view."
     "As such, we are initiating coverage of five companies that we believe are
 poised to be key beneficiaries of the industry's potentially explosive
 long-term growth," he added.  "We expect investors who have the patience and
 temperament to withstand the unstable CLEC sector will earn attractive returns
 over the next several years."
     Additional information is available upon request.
     William Blair & Company, L.L.C. maintains a market in the common shares of
 Allegiance Telecom, Inc., Focal Communications Corporation, McLeodUSA
 Incorporated, Time Warner Telecom Inc., and XO Communications, Inc.
     William Blair & Company, L.L.C. is an independent investment firm offering
 investment banking, equity research, institutional and private brokerage,
 asset management and private capital to individual, institutional and issuing
 clients.  Since 1935, the Chicago-based firm has been dedicated to helping its
 clients achieve their financial objectives by providing quality products and
 services.  Located in Chicago, Hartford, London, New York, San Francisco,
 Tokyo, Vaduz, and Zurich, William Blair & Company is entrusted with more than
 $22 billion in client assets.  For more information, please visit
 www.williamblair.com .
 
     William Blair & Company, L.L.C. is a member of the National Association of
 Securities Dealers, CRD number 1252.
 
 

SOURCE William Blair & Company, L.L.C.
    CHICAGO, April 10 /PRNewswire/ -- Citing an enormous U.S. market for
 wireline telecommunications service, William Blair & Company today initiated
 research coverage of five competitive local exchange carriers (CLECs) the firm
 believes are well positioned to serve the booming industry -- Allegiance
 Telecom, Inc. (ALGX $12.75) at Strong Buy; McLeodUSA Incorporated (MCLD $8.06)
 and Time Warner Telecom Inc. (TWTC $34.45) at Buy; Focal Communications
 Corporation (FCOM $6.02) at Long-term Buy; and XO Communications, Inc. (XOXO
 $3.52) at Hold.
     Analyst Kenneth M. Kotylo noted that wireline telecom service constituted
 a $220 billion market in 1999, with local and long-distance services
 representing $112 billion and $108 billion, respectively.  Further, Kotylo
 noted that as of June 30, 2000, CLECs served only 6.7% of U.S. local telephone
 lines, a figure he believes could soar to 40% over the next 10 years.
     "We believe strong industry fundamentals, excellent long-term growth
 prospects, and attractive valuations provide a compelling opportunity for
 investors interested in the CLEC sector," Kotylo said.  "However, investment
 selectivity is paramount.  To reap the rewards of this volatile sector,
 investors must focus on companies with experienced telecom management, strong
 funding, and a record of outstanding execution, in our view."
     "As such, we are initiating coverage of five companies that we believe are
 poised to be key beneficiaries of the industry's potentially explosive
 long-term growth," he added.  "We expect investors who have the patience and
 temperament to withstand the unstable CLEC sector will earn attractive returns
 over the next several years."
     Additional information is available upon request.
     William Blair & Company, L.L.C. maintains a market in the common shares of
 Allegiance Telecom, Inc., Focal Communications Corporation, McLeodUSA
 Incorporated, Time Warner Telecom Inc., and XO Communications, Inc.
     William Blair & Company, L.L.C. is an independent investment firm offering
 investment banking, equity research, institutional and private brokerage,
 asset management and private capital to individual, institutional and issuing
 clients.  Since 1935, the Chicago-based firm has been dedicated to helping its
 clients achieve their financial objectives by providing quality products and
 services.  Located in Chicago, Hartford, London, New York, San Francisco,
 Tokyo, Vaduz, and Zurich, William Blair & Company is entrusted with more than
 $22 billion in client assets.  For more information, please visit
 www.williamblair.com .
 
     William Blair & Company, L.L.C. is a member of the National Association of
 Securities Dealers, CRD number 1252.
 
 SOURCE  William Blair & Company, L.L.C.