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It's official: MCI WorldCom is one

The FCC gives MCI WorldCom the final nod.

By Denise Pappalardo
Network World, 09/21/98

Jackson, Miss. - Finally satisfying regulatory bodies on both sides of the Atlantic, the $37 billion MCI WorldCom merger is official. The Federal Communications Commission (FCC) gave its final nod early last week, and soon after the companies officially inked their deal.

MCI WorldCom, Inc. is a company that promises to provide users a full range of data, Internet, local and international communications services. And because the company is combining all these services over its own facilities, it opens up the possibility for a new range of pricing plans and service packages for users.

The entity starts business with more than $30 billion in yearly revenue and operations in more than 65 countries including Europe and the Asia-Pacific regions. Outspoken WorldCom chief executive Bernie Ebbers is president and CEO of the new company, while MCI CEO Bert Roberts becomes chairman.

In the process of getting this megamerger approved, MCI was forced to sell off its Internet holdings to Cable & Wireless. Cable & Wireless also closed its $1.75 billion deal with MCI WorldCom early last week. The company is now the second largest Internet backbone provider in the world, behind UUNET WorldCom, MCI WorldCom's Internet darling.

So now that the business of the merger is complete, the real work is underway. The work that affects business users, network and service integration.

If you're an MCI Internet customer you are being ported over to Cable & Wireless's network. And if you're a WorldCom business service customer, things may be getting dicey, says Eric Paulak, an analyst with the Stamford, Conn., consulting firm the Gartner Group.

"The plan is to migrate MCI's billing and customer care system over to WorldCom," Paulak says. "In the long run, this is a good move, but it will be a painful process.

"If you're a WorldCom customer, you will go through hell," Paulak says. MCI's customer care and billing system is better than WorldCom's and will improve services, but swapping out systems is difficult, he says.

But Fred Briggs, MCI's chief engineering officer, claims MCI WorldCom has paved the way for a smooth transition for both MCI and WorldCom customers.

UUNET Internet access services will be available to networkMCI One customers. NetworkMCI One is a service that integrates long-distance voice, dedicated data and Internet access services on a single bill. While MCI is ready to offer UUNET's services, its billing system is not yet integrated.

MCI has set up a feed between UUNET and MCI's billing center. MCI will then manually add the UUNET billing information to networkMCI One customer invoices.

MCI WorldCom has linked its customer care calling centers so if an MCI customer has a question about a WorldCom service, the customer's call can simply be transferred to another agent.

The long-term plan is to integrate the platforms, but MCI WorldCom wants customers to at least have access to all available services, Briggs says.

Marc Ferranti, a corespondent with the IDG News Service contributed to this story.