DALLAS March. 6, 2002 - In a milestone for local telephone competition, Allegiance Telecom, Inc. (Nasdaq: ALGX), a leading facilities-based integrated communications provider, announced the completion of electronic links between Allegiance's and Verizon's (NYSE:VZ) Operations Support Systems (OSS), reducing the time required to process customer orders for local telephone service requests.

The new links, also known an electronic bonding, are in addition to connections Allegiance had already established with Verizon systems in the Northeast in 1999 and mid-Atlantic region in 2001.

Electronic bonding enables computers at different phone companies to communicate with each other in real-time, providing for rapid sharing of customer information, service requests and other data. The bonding between the two computer systems makes it easier for business customers in certain areas of the Allegiance Telecom markets of Dallas, Tampa, Southern California, Portland and Seattle to switch from one local service provider to another. This accomplishment builds on previously successful electronic bonding of OSS with Verizon in Allegiance Telecom's New York City, Long Island, White Plains, N.Y., Boston, Northern New Jersey, Philadelphia, Pittsburgh, Baltimore and Washington, D.C. markets.

Allegiance Telecom is now 100 percent electronically bonded with incumbent local exchange carriers (ILECs) in all 36 markets that it serves. Allegiance's network "footprint" is capable of serving 57 percent of the businesses in the United States. "Today's announcement with Verizon completes Allegiance's goal of implementing electronic bonding with all of the territories served by the regional Bell operating companies," said Royce Holland, chairman and chief executive officer of Allegiance Telecom. "Allegiance is the first competitive telecommunications provider to have an extensive, national electronic bonding capability."

"This is an excellent example of what can be accomplished when a competitive carrier and incumbent local provider cooperatively use their energies and resources," said Raymond N. Wierzbicki, Verizon group vice president. "This was a collaborative effort marked by teamwork and cooperation by both companies to foster competition in the local telephone market."

Allegiance Telecom developed its electronic interfaces to work with Verizon systems, which follow industry standards. Allegiance uses MetaSolv Software's TBS application to process the LSR and DSET Corporation's 'ezLocal' software as the bonding application to Verizon. This enables Allegiance to process orders quickly and at a lower cost to better serve their local customers.

Using electronic interfaces, Allegiance is able to receive from Verizon a "firm order confirmation" - acknowledgement that an order has been received - rapidly. This confirmation is typically sent within two hours, and on many occasions, it is sent almost instantaneously. Allegiance has also developed proprietary software to automatically process the confirmed information into network inventory and to field services personnel.

Through its many automation efforts to streamline ordering, Allegiance Telecom processes more accurate orders - immediately - than if the order was taken manually. Customer order data is entered into the system only once; there's no need to enter information several different times for different company systems, greatly minimizing the possibility of typographical errors that can delay service. Allegiance Telecom is electronically bonded with Verizon for both local service requests (LSRs) for unbundled loops and access service requests (ASRs) for special access requests such as high capacity T-1 lines.

Electronic bonding will significantly increase the volume of customers that can be switched to Allegiance service each month and help eliminate opportunities for service interruptions during the switching of a customer's service from one local provider to another.

Allegiance Telecom is a facilities-based integrated communications provider headquartered in Dallas, Texas. Allegiance offers businesses a complete package of telecommunications services, including local, long distance, international calling, high-speed data transmission and Internet services. Allegiance serves 36 major metropolitan areas in the U.S. with its single source provider approach. Allegiance's common stock is traded on the Nasdaq National Market under the symbol ALGX.