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Mci, Microsoft Join On-Line Forces

MCI Communications Inc. and Microsoft Corp. will jointly develop and market on-line and data networking services, and Microsoft Internet Explorer will be MCI’s preferred Wide World Web browser.

The latest alliance strengthens ties between Microsoft software and MCI telecommunications services, Microsoft chairman Bill Gates and MCI chairman Bert Roberts said in a telephone news conference Monday.

“MCI and Microsoft have a lot in common,” Gates said. “We’re both very entrepreneurial and see some great opportunities ahead relating to the Internet.”

MCI handles customer service for Microsoft Network, an on-line service that was started late last summer, and the two companies have done some joint marketing.

That relationship figured strongly in choosing Microsoft as MCI’s recommended Infobahn on-ramp, although MCI will remain accessible through Netscape and other Web browsers, Roberts said.

“MCI has cast the die. We are going to use the Microsoft Internet Explorer on a preferred basis,” he said. “We will integrate that into our software (and) Web pages, and what we offer to our customers will be based on that software….

“We are pushing our boat, if you will, into the waters of going with the Microsoft various products as we move forward in our own Internet ventures.”

Rather than investing in each other or in a formal joint venture, MCI and Microsoft will combine some on-line offerings. One example is incorporating Microsoft browsing software in MCI’s Internet products.

In turn, Microsoft will offer ways to purchase MCI services like conferencing and advanced capacity ISDN lines on Windows software.

MCI will market a customized version of the Microsoft Network, “MSN from MCI,” and use Microsoft software in so-called “server” computers that apply Internet technical standards for exchanging data both on the global data network and on private networks.

MCI also announced new services to help customers connect to the World Wide Web and develop new internal data-sharing practices.

Products developed under the alliance should begin appearing within a few months, Roberts said.

Neither anticipated problems from potential competition between two separate on-line news ventures, one between MCI and News Corp., the other between NBC and Microsoft.

The former, Delphi, is being reorganized as a separate entity in which MCI will hold a minority, non-controlling interest, Roberts said.

Short of a duplication of services, “I would expect there would be some overlap,” he said. “I don’t see a problem there. I see an opportunity.”

The alliance rounds out a series of partnerships that have helped MCI expand its services beyond traditional long-distance calling.

In 1994, British Telecom invested $4.3 billion for a 20 percent stake in MCI.

Last year, MCI invested $2 billion in News Corp., partly to expand the on-line products both offered.

Those two companies last week jointly won a $682 million bid for a direct broadcast satellite license in the United States. They plan to offer a direct satellite TV service in about two years.

Tags: business