Chase Manhattan Corp. has leased network services from Metromedia Fiber Network of White Plains, N.Y., which sells a technology known for its remarkably fast data transmissions.
Financial terms of the 10-year deal were not disclosed. Metromedia will connect the banking company's major operating centers in New York, New Jersey, Delaware, and Texas to a fiber optic network within 120 days.
Edward Kountz, an analyst at TowerGroup, a Needham, Mass., technology consultancy, said many large financial services companies are moving to fiber optic networks to speed up their communications.
"The fact is, the infrastructures of the networks that were set up five or 10 years ago were just not designed for what the technologies and Internet protocols are now capable of," Mr. Kountz said. "All of this requires bandwidth, and bandwidth, obviously, for a long time has been very tight."
Mr. Kountz said banks such as Chase should have more resources to invest in systems now that their year-2000 worries are past. With Metromedia's network, he said, Chase commercial bankers worldwide will be able to interact live, and retail employees can access data warehouses.
Scott Berry, a product development director at Metromedia, said large companies with growing bandwidth needs are choosing fiber optic cables because they can move more than two terabits of data per second.
For example, he said, fiber optics could transmit an entire volume of the Encyclopedia Britannica more than 300 times in a second. (A terabit is the equivalent of 1,000 gigabits, and a gigabit is 1,000 megabits. By comparison, cable modems move data at one megabit per second, a terabit is a million times faster.)
Metromedia offers "dirt-cheap bandwidth," Mr. Berry said.
"Once you have the fiber," he said, "it is kind of like having your own road, a private highway, and you can drive any kind of car you want. It can handle any kind of traffic you can come up with. Yesterday's network was a gravel path."
Metromedia, a seven-year old company, has put down 745,000 miles of fiber optic cable in major U.S. and European markets and has a goal of setting down 3.6 million miles worldwide.
Tom Fogarty, a Chase executive vice president in charge of systems infrastructure worldwide, said his company went to Metromedia to help it deal with bandwidth capacity issues.
"I would say that we are positioning ourselves to enable whatever those application demands will be," he said. The network will be the "foundation of what we can build everything on."