> Email is one of the most important of the Internet services.
> As a very large, fast growing, Internet Service Provider,
> EarthLink requires a robust and powerful email architecture
> that will support rapid expansion. In this presentation David
> Beckemeyer, VP Engineering for EarthLink Network, describes
> such an architecture, its motivations, its future, and the
> difficulties in implementing a service on this scale.
- Number of Earthlink subscribers, early 1996: 20,000
Number of Earthlink subscribers, early 1997: 170,000
Number of Earthlink subscribers, early 1998: 425,000
Growth rate: Net +10,000/week
- Incoming mail volume: 17 messages/second (peak: 30 msgs/sec)
This comes to 1.5 million msgs/day
Authenticated at 250 xactions/second
- Pop client stats: 600-800 simultaneous connections
Averages 25 connects/second
Over 2 million POP3 sessions/day
Messages average 2K in length
- Earthlink's total bandwidth to the Net: 200 Mbit/sec (50% utilization)
Total email storage capacity: 700 Gigabytes
Average cost to Earthlink for storage: $1million/Terabyte
- 65 people responsible for Earthlink's total system architecture
- Earthlink founder sees Earthlink as direct competitor to AOL
We also find at
a strategic alliance between earthlink and Sprint...
> EARTHLINK AND SPRINT ANNOUNCE STRATEGIC ALLIANCE
> EarthLink-Sprint alliance strengthens EarthLink and gives Sprint a
> firm foothold in the Internet market
> Unified service enables both companies to rapidly expand Internet
> market share
> PASADENA, Calif., February 11, 1998 - EarthLink Network, Inc. (NASDAQ:
> ELNK) and Sprint Corporation (NYSE: FON) announced today a long-term
> strategic alliance that creates one of the industry's most powerful
> Internet access services. EarthLink and Sprint will create a single,
> unified Internet service that will have the potential to reach
> millions of new customers while both companies achieve prominent
> positions in the Internet services market. It is the strategic intent
> of both companies for EarthLink to remain an independent company with
> the flexibility to pursue its strategic objectives. As part of the
> alliance, Sprint agrees to make a minority investment in
> EarthLink. The two companies will establish a broad business
> relationship, which includes the contribution of selected assets and
> significant commercial commitments.
> EarthLink will obtain Sprint's Internet Passport customer base,
> approximately $24 million in cash, $100 million in convertible debt
> financing, access to Sprint's branded marketing and distribution
> channels, a five-year commitment from Sprint to deliver a minimum of
> 150,000 new customers annually and preferred access to Sprint's
> world-class data network.
> In exchange, Sprint will receive 4.1 million shares of convertible
> preferred stock in EarthLink. In addition, Sprint will initiate a
> tender offer to purchase 1.25 million shares of EarthLink common stock
> at $45 per share. The sum of common and preferred shares Sprint
> receives at the time of closing will represent a 10 percent voting
> interest and approximately a 30 percent economic interest in
> EarthLink. Sprint will also secure two seats on EarthLink's board of
> directors, one of which will be occupied by William T. Esrey, chairman
> and chief executive officer of Sprint.
> The alliance between EarthLink and Sprint allows both companies to
> balance their financial and strategic interests as well as capitalize
> on each other's key strengths. The alliance preserves EarthLink's
> independence and entrepreneurial spirit and provides Sprint with a
> significant enhancement to its strategic investment in the Internet
> market. It also enables EarthLink to immediately expand its member
> base by 25 percent to approximately 600,000 members, leverage the
> resources and equity of the Sprint brand, and accelerate its future
> The alliance enables Sprint to continue to build its brand recognition
> in the Internet market and deliver Internet access services to its
> large telecommunications customer base, while focusing on the
> marketing and networking capabilities that are its strongest asset.
> "EarthLink has always delivered the easiest, most friendly and useful
> Internet access service available," said Sky Dayton, founder and
> chairman of EarthLink Network. "The EarthLink-Sprint alliance takes
> our company to the next level. The alliance pairs EarthLink with one
> of the most powerful brands in the world, helping us bring our
> services to millions of potential new members in the coming years."
> Added Esrey, "This alliance strengthens Sprint's position in the
> Internet access industry, teaming Sprint with a nimble,
> growth-oriented company that shares our commitment to fast, reliable,
> responsive products and technologies. Through this agreement, we are
> able to enhance our Internet offering while continuing to deliver the
> highest quality service."
> The unified EarthLink-Sprint Internet service, sharing both companies'
> brands, will be promoted through various EarthLink and Sprint
> marketing channels. Sprint's marketing channels include outlets like
> airlines, cable companies, colleges/universities, financial
> institutions and retail outlets such as Radio Shack, in addition to
> sponsorships like the NFL, Rolling Stones and the U.S. Ski Team. The
> EarthLink-Sprint service will also be bundled with various existing
> Sprint consumer and small business products and services.
> "It's a great marriage," said Charles (Garry) Betty, president and
> chief executive officer of EarthLink. "This alliance with Sprint
> enables us to strengthen our brand, immediately expand our member base
> by 25 percent to approximately 600,000, increase our marketing efforts
> and lock in a low-cost network commitment. Now EarthLink is even
> better positioned to aggressively grow our business. The alliance puts
> the power of Sprint's marketing and sales channels behind EarthLink,
> expanding our reach deeper into the mass market of consumers and
> businesses which have yet to get on to the Internet."
> "Sprint has been relentless in its focus on delivering
> high-performance products and services over one of the fastest, most
> advanced networks in the world," said Gary Forsee, president and chief
> operating officer, Sprint Long Distance Division. "The alliance with
> EarthLink enables us to efficiently provide a host of high-quality
> Internet services to Sprint customers, while building our brand equity
> and market share in the Internet."
> The Deal - A Snapshot
> The terms of the deal involve many components:
> 1. Sprint will purchase approximately 30 percent
> minority stake in EarthLink, as follows:
> * Sprint will initiate a tender offer for 1.25
> million EarthLink common shares at $45 per
> * Sprint will receive 4.1 million shares of
> convertible preferred stock directly from
> EarthLink; and
> * Sprint will secure status as the exclusive
> telecommunications provider promoted in
> EarthLink's channels.
> 2. In exchange for 4.1 million preferred shares and
> the right to tender for 1.25 million common
> shares, Sprint will provide EarthLink with:
> * All of Sprint's approximately 130,000
> Internet Passport subscribers;
> * A five-year commercial agreement for Sprint
> to promote EarthLink through its marketing
> channels, including commitments to generate
> a minimum of 150,000 new EarthLink members
> * A four-year network contract allowing
> EarthLink to utilize Sprint's world-class
> data IP network at favorable prices;
> * Approximately $24 million in cash;
> * A $100 million line of credit in the form of
> convertible debt for EarthLink's use,
> available incrementally over the first three
> years; and
> * Agency status to bundle Sprint's
> telecommunications services with EarthLink
> 3. The parties have entered into a governance
> agreement that sets forth the rights and
> restrictions governing the corporate relationship
> between EarthLink and Sprint.
> EarthLink will manage the operations, customer service, technical
> support and product development for the unified Internet
> service. EarthLink and Sprint will work together on marketing, sales
> and product development. By sharing the use of their best assets,
> EarthLink and Sprint will each focus on their core businesses,
> enhancing their combined prospects for growth and success.
> Expanded Services
> Customers are the biggest winners in this alliance. EarthLink's
> existing members gain access to another high-speed, reliable dial-up
> access network which will support x2 technology nationwide. EarthLink
> expands its local access POPs to more than 1,200 - more than any other
> Internet or online service provider. EarthLink also becomes the only
> ISP to support both x2 and K56flex nationwide through more than 500
> 56K POPs. In addition, as a full-service communications provider, the
> alliance enables Sprint to offer integrated billing and multiple
> communications services to EarthLink's customers. EarthLink also
> bolsters its financial position, ensuring it will continue to have the
> resources to scale up while providing excellent service.
> Through the unified offering, Sprint's Internet Passport customers
> will have access to an expanded set of services. These service
> features include a Personal Start PageSM, a free 6MB homepage, options
> to purchase extra email boxes, vanity domains and low-cost Web sites,
> access from more than 1,200 POPs which support both K56flex and x2
> technologies, and continued exceptional technical support.
> Deutsche Morgan Grenfell served as EarthLink's sole advisor for this
> About Sprint
> Sprint is a global communications company at the forefront in
> integrating long distance, local and wireless communications services,
> and one of the world's largest carriers of Internet traffic. Sprint
> built and operates the United States' only nationwide all-digital,
> fiber-optic network and is the leader in advanced data communications
> services. Sprint has $14 billion in annual revenues and serves more
> than 16 million business and residential customers.
> About EarthLink Network
> EarthLink Network is the world's largest independent Internet service
> provider. Through a full range of innovative access and hosting
> services, the company makes the Internet relevant and productive to
> hundreds of thousands of individuals and businesses every day.
> Headquartered in Pasadena, EarthLink provides local access to
> thousands of communities from more than 1,110 POPs in North America
> and 42 internationally. Additional service and pricing information is
> available by calling (800) 395-8425 and through EarthLink's Web site
> at http://www.earthlink.net.
> Sprint Internet Passport is a service mark of Sprint Communications
> Company. All other brand and product names are trademarks and/or
> service marks of their respective companies.
> This release contains forward-looking statements within the meaning of
> the "safe harbor" provisions of the Private Securities Litigation
> Reform Act of 1995. Such statements are based on management's current
> expectations or beliefs and are subject to a number of factors and
> uncertainties which could cause actual results to differ materially
> from those described in the forward-looking statements. In particular,
> careful consideration should be given to cautionary statements made in
> each Companies' reports filed with the Securities and Exchange
> Conference call playback is available hourly from 8:30 a.m. PST to
> 4:30 p.m. PST. To listen, please dial 1-800-659-7914.
We don't care about no government warning. Brimful of asha on the 45.