"By 2002, nearly 18 percent of all telephone calls made in the largest corporations in North America will be connected over networks based on Internet Protocol, according to a group of Fortune 1000 chief information officers surveyed by Killen. The value of those calls will top US$1 billion by 2003. By 2005, the percentage of calls over IP will mushroom to nearly 33 percent, the CIOs said. That compares to just 1 to 2 percent of calls made over IP-based networks today, worth about $31 million."

The division, formerly known as Kiewit Divisified Group, was spun off in April into a new company called Level 3, with $2 billion in cash from Kiewit. Shortly after the separation, Level 3 raised another $2 billion in a public debt offering, doubling its war chest. The plan is to build a $10-billion fiber-optic network in five stages. With its $4 billion in hand now, the company will string 15,000 miles of fiber to the 50 largest US cities and selected cities in Europe and Japan. It plans to raise money for the rest of the network through cash flow and more equity or debt offerings. "I don't see IP telephony putting circuit-switched telephone companies out of business, by any stretch of the imagination," retorted Ozzie deFaria, marketing director of AT&T's IP telephony service.