CABLE & WIRELESS ADDS INTERNET BACKBONE TO MIX

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LONDON-Cable & Wireless plc completed its $1.75 billion cash acquisition of MCI Corp.’s U.S.-based Internet business, including its Internet backbone services, about 1,000 specialist employees, as well as its retail and Internet Service Provider customer base.

Cable & Wireless now owns and operates an Internet network that carries more traffic than any other network in the world, and has the ability to provide integrated voice, data and Internet services to consumers and businesses worldwide, the company said.

The network supplies enough bandwidth to send from coast to coast the entire two hours and 25 minutes of the movie Independence Day in digital video quality with full-motion picture and audio in 17.1 seconds, or the entire Encyclopedia Britannica in about 3 seconds.

“Cable & Wireless is immediately positioned to grow the business via strategic affiliations and valuable partnerships,” said Rich Yalen, chief executive officer of Cable & Wireless USA. “We are on track and ready to grow.”

Cable & Wireless USA has created two disparate business divisions with individual profit-and-loss responsibilities-Commercial Internet Services and Consumer Internet. Cable & Wireless also acquired customer-care facilities and personnel, including facilities in Sacramento, Calif.; Cary, N.C.; Houston; Dallas; and Phoenix.

“Previously, we looked upon Cable & Wireless USA as a provider of resale services, (and) therefore have only worked together on small limited projects,” said Bob Woog, senior vice president of IXnet.

“With the Gemini transatlantic cable and the pending bold move to become a major player in the Internet arena, we now view Cable & Wireless as an aggressive, facilities-based full service provider who can assist us in the rapid growth of our network and our emerging line of services.”

Cable & Wireless’ initial product offering includes domestic and international dedicated access to the Internet, consumer and business dial-up access to the Internet, Web hosting, managed firewall services and customized Internet solutions.

MCI decided to put the Internet business up for sale after GTE Corp. in early May filed a private antitrust lawsuit to block MCI’s proposed $38 billion merger with WorldCom Inc., claiming the combined company would monopolize the market for Internet backbone services with a 40-percent to 60-percent market share. GTE had courted MCI with a merger bid last fall, but lost out to WorldCom.

Along with its foray into the Internet business, Cable & Wireless has several wireless holdings.

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