SANTA CLARA, Calif. -- Level 3 Communications, Inc. (Nasdaq: LVLT - News) today announced that it is launching two new residential VoIP services to more than 300 of the largest markets in the U.S. by the end of 2004, with service availability beginning during the second quarter.

The new services, (3)VoIP(SM) Enhanced Local service and HomeTone(SM), will enable cable operators, ISPs, enhanced service providers, IXCs and others to offer IP-based local and long-distance voice service to consumers via any broadband connection to the home. Level 3 formally unveiled the services at the Spring 2004 VON Conference & Expo.

"The U.S. consumer voice market, which is valued at over $65 billion per year, is on the verge of fundamental change," said Sureel Choksi, president of Softswitch Services for Level 3. "The growth of residential broadband access, coupled with the increasing adoption of VoIP technology, is allowing a wide variety of companies to pursue the consumer voice market. We believe Level 3, with its extensive softswitch platform and local network infrastructure, is in a strong position to capitalize on this trend via these new complementary offerings.

"Our new residential VoIP offerings are designed to enable new entrants and established broadband and communications companies to cost-effectively accelerate their deployment of carrier-quality VoIP services to millions of U.S. households," said Choksi.

"(3)VoIP Enhanced Local Service provides customers operating their own switching infrastructure the ability to deploy consumer VoIP services cost effectively with maximum control over the end-user experience and minimal involvement in complex interconnection issues," said Jack Waters, CTO and president of Voice Technologies for Level 3. "Customers are able to accelerate their time to market by leveraging Level 3's CLEC status in 48 states, local calling capability covering more than 93 percent of the U.S. population, and long-distance calling service worldwide."

"We're encouraged by the level of interest we're seeing from cable operators, IXCs, and enhanced service providers," said Waters. "Level 3's IP backbone and softswitch platform allow us to offer superior cost and performance advantages with high quality of service."

HomeTone, which Level 3 expects to begin offering during the second quarter of 2004, is a turnkey, hosted VoIP alternative to traditional residential local and long distance phone service. It offers the benefits and functionality of (3)VoIP Enhanced Local service, plus calling features such as voice mail, call waiting, and three-way conferencing. In addition, HomeTone includes advanced calling features such as unified messaging, and a personal locator function that forwards the call until it reaches the designated party.

HomeTone service gives channel partners, such as ISPs, cable operators, ILECs and enhanced service providers the ability offer a cost-effective, high-quality local and long distance telephone service to consumers with minimal upfront costs and accelerated time to market. Channel partners can develop unique calling features and functionality with HomeTone to differentiate their voice offerings to consumers.

Level 3 Communications Inc.