Built at Light Speed

"Who are these people?" That petulant question kept running through Emma Wells's mind as she flipped through a 30-page business plan. As a Herndon, Virginia-based account manager for Cisco Systems, the world's leading maker of Internet routers and switches, she was supposed to gather intelligence about potential clients and their online ambitions. But Wells, 32, had never encountered anything as brash as the proposal that arrived in November of last year.

Officials at Cogent Communications, a virtually unknown Washington, DC-based company, claimed that it intended to build a new national backbone for Internet service. On a price-performance basis, it declared, the new service would leave every known competitor in the dust. Cogent's customers, business users in big, urban office buildings, would enjoy Internet connections of 100 megabits a second -- fast enough to download full-length movies in seconds. For such an enormous increase in speed, Cogent would not jack up prices. Rather, it would undercut the standard charges for business Internet connections by 30%. To make such a vision come true, Cogent founder Dave Schaeffer declared, he merely needed 12,000 miles of fiber-optic cable and several-hundred-million dollars' worth of Cisco equipment.

"That's a huge business concept," Wells said. "That's the kind of thing that AT&T or Worldcom might do." Curious to see who would sketch such big dreams, she decided to visit Cogent's offices in the Georgetown section of Washington, DC. To her consternation, the company turned out to be a three-person startup. There weren't even enough chairs to have a proper meeting.

Yet Wells and her bosses at Cisco's San Jose, California headquarters couldn't rule out the possibility that Cogent might be onto something big. Schaeffer, they learned, was no newcomer to startups. He had founded six companies, most of which had a telecom twist. He was involved in detailed talks with Lucent and Nortel -- two of Cisco's rivals -- for the network equipment that he would need this time around. And Cisco's top optical-networking experts declared that, from a sheer technical perspective, Schaeffer's big vision wasn't so crazy.

Still, what equipment supplier would bet heavily on a company whose workforce could squeeze inside one Mazda Miata? Cisco executives deliberated for a few weeks. Then Schaeffer startled them into action by clinching the first major piece of his plan: negotiating to buy roughly $200 million worth of fiber-optic cable from Williams Communications Group Inc. "At that point," Wells recalls, "we knew he was serious.''

One year later, Cogent is about to activate its network. Its fiber-optic cables crisscross the United States, connecting hundreds of cities. Cisco has agreed to sell a whopping 800 of its routers to Cogent, which is installing them at urban sites to serve what it hopes will be swarms of business users. Cogent now boasts more than 125 employees and $116 million in venture-capital funding.

Cogent isn't assured of victory yet. It faces intense competition from at least a dozen other companies trying to exploit similar new technology. Cogent could stumble as it tries to deliver reliable Internet service on a nationwide scale and then tries to woo enough business customers to absorb its costs. But its rollout so far has been fast enough to turn heads in the telecom industry. Now Cogent must struggle to outpace its competition in a world where technical ingenuity alone doesn't win the game -- it just lets you come back for the next round.

Speed (Still) Wins

Cogent's dash to become a substantial company is partly a reflection of its founder's personality. As a teenager, Dave Schaeffer raced through the University of Maryland in just 2 years, taking classes all 12 months of the year and packing as many as 25 credits into each semester. He graduated at age 19 with a degree in economics and with a minor in physics. For much of his twenties and thirties, Schaeffer helped run a family taxicab business. By the early 1990s, he had diversified into the paging and mobile-radio industries. Now Schaeffer, 44, is coming at his new career with all the zeal of a midlife executive making up for lost time.

Of course, new technology is opening major opportunities for anyone who can provide businesses with speedy Internet connections. And that means anyone willing to spend heavily and to move fast. The two crucial elements of Cogent's network -- nationwide fiber-optic cable and high-speed routers -- are available to anyone who can pay for them. At least a half-dozen upstarts are buying such equipment by the truckload.

In this race, speed wins. Perhaps 40,000 office buildings across the United States are big enough to justify installing high-speed Internet service. Most of those buildings already are served by traditional Internet-service providers. If tenants or building owners rip out those connections for something cheaper and faster, they are likely to do so only once. The first company to arrive on their doorstep with a strong case for making a switch will get their business.