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WorldCom and MCI, Together


REVENUE* $7.9 billion**

LONG DISTANCE The No. 4 company in the U.S. market with a 5% share

LOCAL WorldCom already owns fiber-optic networks running through the streets of 52 U.S. cities, thanks to the 1996 merger with MFS Communications. WorldCom has a deal to purchase Brooks Fiber, another local-calling company, for $2.9 billion.

THE INTERNET WorldCom already owns UUNET, the world's biggest carrier of Internet traffic, as well as ANS, the former data-networking subsidiary of America Online, and the former CompuServe network.

*1997 estimates **(including ANS and CompuServe)


REVENUE* $19.8 billion**

LONG DISTANCE The feisty No. 2 in the industry is famous for marketing innovations such as Friends & Family. But lately, it's been under pressure from smaller rivals, including WorldCom.

LOCAL CALLING MCI's costly investments in building up local connections in major cities have squeezed earnings. Merging with WorldCom, which already has extensive local networks, would allow that spending to be scaled back.

THE INTERNET MCI has one of the most extensive Internet ''backbone'' systems in the nation.

*1997 estimates


REVENUE* $27.9 billion

LONG DISTANCE With 25% of the market, the new company will be closing in on AT&T, whose share has dropped from 62% to 54% since 1992.

LOCAL CALLING The combined company will have local connections in some 100 cities across the U.S.

THE INTERNET The combination of UUNET, WorldCom's data-networking facilities, and MCI's Internet backbone makes the new company the top telecom player in cyberspace.

SYNERGIES MCI would plug a big hole in WorldCom's ability to do ''systems integration'' for business. Its SHL Systemhouse subsidiary is a leader in bundling packages of voice and data networks for big corporate customers.

HOLES Neither company has a presence in wireless communications. For now, they can resell service. Will they buy again to fill the gap? Also, neither has a strong overseas presence--unless MCI can retain its marketing alliance with British Telecom, the merger partner WorldCom hopes to supersede.

THE FUTURE With its proposed merger with MCI, WorldCom is building a new breed of phone company. From a single supplier, customers will be able to get almost all of their communications services. WorldCom will not only have great marketing muscle but also a cost advantage over other long-distance companies and the nation's largest data network for the Internet-access business. The deal should change the competitive landscape for the U.S. telecom business.

*1997 estimates **(including Brooks Fiber)

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Updated Oct. 2, 1997 by bwwebmaster
Copyright 1997, Bloomberg L.P.
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