Part of of the Yeager issue...

----- Forwarded by Scott Bolton/Enron Communications on 06/30/00 11:49 AM 
-----

	Cynthia Sandherr@ENRON
	06/26/00 01:38 PM
		 
		 To: Scott Bolton/Enron Communications@Enron Communications, Stephen D 
Burns/Corp/Enron@ENRON, Chris Long/Corp/Enron@ENRON
		 cc: Joe Hillings/Corp/Enron@ENRON, Richard Shapiro/HOU/EES@EES
		 Subject: Regulatory Info and discussions on digital divide

fyi......
---------------------- Forwarded by Cynthia Sandherr/Corp/Enron on 06/26/2000 
04:45 PM ---------------------------
From: Scott Yeager@ENRON COMMUNICATIONS on 06/26/2000 11:43 AM CDT
To: Cynthia Sandherr/Corp/Enron@ENRON
cc:  

Subject: Regulatory Info and discussions on digital divide  

Thanks for the note. I will call Royce. By the way there is a new book out 
called "Tele-Revolution" by Richard G. Tomlinson. It has the MFS story in it.

I will be getting  copy of my book for you in the next month or so.

Also attached is a new powerpoint I worked on over the weekend to use to 
discuss the Regulatory issues associated with the EBS business.

Look it over and lets talk. 

Here is the memo I sent out internally.


A regulatory conference call precipitated a bunch of discussion last week and 
I have been talking to Griebling and Jim F.about the need for an overall 
strategy from a regulatory perspective.  Below is my view of the issues and 
my attempt to scope the discussions that need to occur. We need to hire  
regulatory group that has dealt with these issues in Wash, DC, the PUC level 
the city Gov. level and Internationally. Jim F. has been given the name of a 
company that knows the issues and could help us decide how to proceed. I 
consider this to be a key strategic issue for the company.

Also, we must now be concerned about the rising movement in Wash. DC to 
charge a tax on all revenues associated with the Internet as well as creating 
a Universal services fund as a result of the Digital Divide Debate. This has 
huge financial implications if we set it up wrong and they create a tax or 
Universal Services fund for bridging the Digital Divide. This may be one of 
the hottest topics in DC. and the mood is very much for the Democrats to push 
for such a tax on all dollars spent via the Internet. This would be a huge 
drain on EBS and other companies.  Enron on line could also be hurt as well 
as all trading deals on the net. 

The other issue is the local loop for Wasabi and the implications of 
extending the pooling points to multiple carrier hotels in a city. Also later 
to the CO.  Griebling has suggested we could file for  a unique status, get 
some press, and bundle numerous ideas inot an entity that could sidestep the 
regulatory national and local loop issues in one fell swoop. Would be nice. 

We need to decide if the entity that goes to carrier hotels is the same 
entity that goes to the CO. If the entity that goes to the CO is a CAP or a 
CLEC or just does a commercial deal with the CAP that does business in the 
City. Should we do a deal with the CLEC to go to the CO or is the entity a 
CAP or CLEC?  Do we just do business with the numerous existing CLEC's? This 
has huge implications to the franchise fee we would pay to  be a CAP or CLEC 
which would be on all revenues so we would need to limit those taxes. If we 
choose to be a CLEC we would fall under the Universal Services fund and there 
could be other negative and  costly requirements. What entity and how we 
commercially get to the CO is a key decision to make. 

We also need to make sure the entity that sells bandwidth via the Pooling 
points is never taxed via the Universal services fund as it exists  today or 
could exist in the future. The other issue is the status of the company that 
owns the fiber and the DWDM equipment is it the same company as the poolling 
points and the IP layer the way it is today? What about the applications 
layer and what about the different commericial groups that need streams at 
the applications layer and the groups that need a Tiered QoS IP cloud? Can we 
claim we are not the internet and would hold a special status? Can the BOS 
and the EIN allow to claim a special status and would the pooling point 
extension to multiple carrier hotels allow us to have a special status? 

Luckily the Technology for All TFA efforts is something we can point to to 
show how proactive industry is being in bridging the Digital Divide and there 
is no need for the  new internet based universal service fund some are 
talking about. That is one of the reasons that Ken Lay is on the board of TFA 
nationally. We need to get the  TFA lab installed in the DC area to show off. 
Anyway, we need to now include that open issue  of a potential tax on all 
internet transactions in our discussions of how we structure the company and 
make sure we would minimize the taxes assocated with selling things on the 
Net.








	Cynthia Sandherr@ENRON
	06/22/00 04:43 PM
		 
		 To: Scott Yeager/Enron Communications@Enron Communications
		 cc: royce.holland@allegiancetelecom.com
		 Subject: Hello

Scott:  I had the pleasure of sitting by Royce Holland at a dinner hosted by 
Congressman Markey last evening.  He asked me to say "hello" and ask you to 
call him sometime soon so you two can get caught up on each others lives.  
His phone number is 214-261-7105 and his e-mail address is listed above.

On a different matter, would you please call me on the Discovery information 
I sent to you recently?  My number is 202-466-9143.  Many thanks.