Nynex Corp is in negotiations with Hitrail, the consortium of 11 European railway operators, to create a joint venture company and for a contract to upgrade its X25 packet-switched data network, according to a source close to the negotiations. The negotiations follow the disbanding of the Hermes project several months ago: Hermes has the network upgrade as one of its objectives. For the railway monopolies, it has always been that they wanted the data network modernised. Other members of the group had differing objectives and decided to drop out for various reasons, the source said. Hitrail came back to us because they still needed the upgrade. The source says the New York and New England phone company will provide the latest technology and the software packages to manage it. The source would not specify exactly which technologies Nynex proposes to use, but noted that it is likely that the 11 railways could end up with a digital backbone, which is very interesting given what’s going on in Brussels right now. It could become the basis for offering leased lines. In the case that telecommunications deregulation really does get forced through by Brussels, the source said, Nynex would want to become ‘a carriers’ carrier’. We wouldn’t necessarily be a big network to compete with the PTTs, but we’d probably go to the PTTs and say, ‘Hey, we have this big network, do you want to use it?’ The Nynex-Hitrail joint venture company would likely be called Hermes, said the source, and its capital opened up to other European partners. Choice of location for the joint venture company is still up for grabs, the source said, although Hitrail, which is based outside Amsterdam, is lobbying for the Netherlands, while Nynex would like to have it in its own continental back yard in Brussels.
