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Covad, SBC Make Up, Agree to DSL Contract

Santa Clara, Calif.-SBC Communications Inc.-which announced a $6 billion digital-subscriber-line strategy called "Project Pronto" last year-said it will invest $150 million in Covad Communications Group Inc., and it has hired its former legal foe as an in-region and out-of-region DSL provider.

The marketing contract will total $600 million over a six-year period starting Oct. 1, the companies said, adding that Covad's pending antitrust suit against SBC and Pacific Bell has been settled.

Covad, meanwhile, said its recent acquisition of BlueStar Communications Inc., coupled with previous work stoppages surrounding Verizon Communications, will enable it to reach an installed base of 200,000 DSL lines by the end of the third quarter. That figure will exceed Wall Street expectations by 30 percent, the company added.