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Fidelity Holdings' IG2, Inc. Subsidiary Lauds Federal Decision

22 November 1999

Fidelity Holdings' IG2, Inc. Subsidiary Lauds Federal Communications Commission Decision

    KEW GARDENS, N.Y.--Nov. 19, 1999--Fidelity Holdings' IG2, Inc. ("IG2") subsidiary lauded yesterdays decision by the Federal Communications Commission (FCC) requiring Regional Bell Operating Companies (RBOCs) to share their existing telephone lines with Competitive Local Exchange Carriers (CLECs) such as IG2. Under current rules customers of carriers such as Northpoint Communications Group, Inc. (NPNT), Covad Communications (COVD) and Rhythms NetConnections, Inc. (RTHM) were forced to lease a second line from the phone companies in order to deliver Digital Subscriber Line (DSL) services to end-users. This has been a costly, inefficient and time-consuming process that often limited consumers from selecting a broadband service provider of their choice.
    The FCC's decision allows the consumer the ability to choose their RBOC to provide dial tone and voice and choose another provider for their High-Speed DSL needs, including the IG2 network, now in the opening stages of collocation and deployment in the New York metropolitan area, which is expected to provide all these services as well as cable broadcast television and video conferencing.
    The FCC order, adopted yesterday, will become effective by the end of the year, but actual implementation by the RBOCs will extend into year 2000. After that time, the RBOCs will be expected to provide competitive companies like IG2 with access to t he shared line in a much more timely manner and at a reasonable cost.
    "As a result of yesterday's decision, we expect IG2 to be better positioned to expand its market reach to a greater number of consumers with always on broadband services in a timely manner and at a more attractive price, said Kimberly Peacock, IG2, Inc.'s Chief Executive Officer. This decision allows for companies to deploy services quicker, with a lower cost that is sure to translate to the consumer. It provides consumers with more choice, enables broadband providers like IG2 to offer additional services more easily, and helps phone companies demonstrate that they have opened their markets to competition so that they can provide long distance services in their territories. This decision is solid evidence of the FCC's determination to bring advanced services to all consumers through competition. For three years we have been talking about the potential opened up by DSL and it's nice to see that the market is finally recognizing this as well."
    Doron Cohen, President of Fidelity Holdings, Inc. added, "Along with quicker installation, non-discriminatory pricing of the shared line is expected to put IG2 at a parity with the phone companies in terms of telephone line access. We anticipate that this widespread access resulting from yesterday's ruling should lower the cost of IG2's procurement of a line by 50% and will allow us to economically unbundle our service for those who only want to subscribe to DSL service. This decision adds an important element to our discussions regarding the future of our technology division."
    The IG2(TM) product is based on a multimedia network platform, IG2(TM), designed to provide a bundled package to residential and small business customers of high-speed Internet access, local and long distance telephone service, television programming, television quality video conferencing and e-Commerce capabilities, all through existing telephone wires already installed in the customer's home. Contributing to the IG2(TM) platform are a series of consumer electronic manufacturers, software developers and companies seeking additional exposure utilizing e-Commerce.
    Fidelity Holdings has been a diversified holding company that utilizes information and technology to target industries experiencing consolidation and/or deregulation. The Company operates two divisions -- Automotive and Technology. The Automotive Division operates through Major Automotive Group, a leading consolidator of automotive dealerships in the New York Metropolitan Area. The Technology Division operates under Computer Business Sciences, its IG2, Inc. subsidiary, and its plastics subsidiary. Fidelity Holdings, Inc. is presently exploring the divestiture of its non-automotive activities by way of sale, merger, consolidation or other opportunities. Accordingly, all such non-automotive activities have been classified as discontinued operations in its financial statements.
    For additional information, visit our website at www.fdhg.com, www.majorautomotive.com and www.majorworld.com.
    The information contained in this press release, including any "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 contained herein, should be reviewed in conjunction with the Company's Annual Report on Form 10-KSB and other publicly available information regarding the Company, copies of which are available from the Company upon request. Such publicly available information sets forth many risks and uncertainties related to the Company's business and such statements, including risks and uncertainties related to that are unpredictable and outside of the influence and/or control of the Company.