EDS And MCI WorldCom Align To Capitalize On Global Electronic Bsuiness, Communications And Data Services Markets

Companies agree to significant outsourcing agreements; EDS
purchases MCI Systemhouse for $1.65 billion

PLANO, Texas and JACKSON, Mississippi, February 11, 1999

- In one of the largest agreements of its kind, EDS and MCI WorldCom
today announced a framework that positions the companies to seize
opportunities in the converging global communications and computing
markets. Each company and its customers will be better positioned to
capitalize on the rapid growth in electronic business and global
communications services.

• There are four key elements of the agreement:
• In a 10-year agreement, MCI WorldCom will outsource major
  portions of its information technology services to EDS. EDS will
  assume responsibility for significant applications development and
  maintenance services and virtually all of MCI WorldCom's
  infrastructure services. When finalized, this will represent the
  largest IT outsourcing agreement in the telecommunications industry
  to date, with revenues to EDS expected to range from $5-$7 billion
  over the life of the contract.

• EDS will outsource the bulk of its global network to MCI
  WorldCom, with MCI WorldCom handling end-to-end management of voice
  and data communications services on a preferred basis for EDS and its
  customers. This agreement is expected to approximate $6-$8.5 billion
  in revenues to MCI WorldCom over the next 10 years.

• EDS will acquire MCI Systemhouse for $1.65 billion in cash. The
  acquisition of Systemhouse, an IT services provider that delivered
  $1.7 billion in revenue in 1998, will enhance EDS' applications
  consulting and systems integration capabilities and rank the company
  among the largest information technology services providers in
  Canada. EDS believes it will achieve substantial synergies by
  integrating Systemhouse into its existing infrastructure.

• MCI WorldCom and EDS will capitalize on the fast-growing market
  for global communications and data services, including electronic
  business applications. The companies intend to develop networking
  solutions to business and government entities worldwide utilizing the
  global capabilities of both companies. The expanded services will
  complement MCI WorldCom's existing array of network services now
  offered to large corporate and government users.

"Aligning with MCI WorldCom and its global telecommunications
capabilities will enhance EDS' ability to serve our customers as they
move into the digital world of electronic business," said Dick Brown,
EDS chairman and CEO. "This relationship assures that both EDS and
those we serve are positioned to capitalize on the cresting wave of
global data and voice network services.
"We are also enthusiastic about working with the people who will be
joining EDS from MCI WorldCom and Systemhouse," Brown continued. "To
us, today's announcement offers the best of all worlds - new business,
new capabilities, new customers, new markets, and new highly skilled
and talented professionals."

More than 12,000 employees primarily located in the U.S. and Canada
are expected to transition into employment with EDS from MCI WorldCom
and from Systemhouse. Approximately 1,000 EDS network employees from
offices around the world will be offered employment with MCI
WorldCom.

"This agreement is a classic win-win," said John Sidgmore, MCI
WorldCom vice chairman. "It allows both companies to grow their core
businesses while creating synergies as each expands its global
offerings. EDS offers MCI WorldCom proven IT and integration expertise,
which will be key to our ability to maintain our technology leadership
position as we continue to aggressively deploy facilities and expand
globally."

The MCI WorldCom IT outsourcing agreement names EDS as the company's
preferred supplier of IT services. EDS will have responsibility for
business process management for selected billing functions, defined
applications development and maintenance, mainframe operations, desktop
and help desk services and LAN support.

The network agreement provides for MCI WorldCom to outsource EDS'
network and establishes MCI WorldCom as EDS' preferred supplier of
communications and network integration services. MCI WorldCom will have
responsibility for voice, data and video transport, and other network
services for EDS and many of the company's network customers.

According to Brown, "network capabilities are increasingly important
to companies that want to emerge as the business leaders of the 21st
century. Our customers in all industries and in every geography are
placing growing emphasis on advanced network capabilities and the
development of electronic business applications. We intend to be there
for them - and our relationship with MCI WorldCom will play a major
role in seeing that happen."

The marketing relationship with EDS strengthens MCI WorldCom's
existing wide area network outsourcing, design, implementation and
management services. MCI WorldCom currently manages hundreds of
networks for leading multinational companies and organizations
worldwide such as the United

States Postal Service, Nasdaq Stock Market, Inc. and the Independent
System Operator and the Power Exchange.

"This partnership brings together the leading players in
communications and information technology, greatly enhancing our
marketing muscle and allowing us access to new markets," noted
Sidgmore.

About MCI WorldCom

MCI WorldCom is a global communications company with revenue of more
than $30 billion and established operations in over 65 countries
encompassing the Americas, Europe and the Asia-Pacific regions. MCI
WorldCom is a premier provider of facilities-based and fully integrated
local, long distance, international and Internet services. MCI
WorldCom's global networks, including its state-of-the-art
pan-European network and transoceanic cable systems, provide end-to-end
high-capacity connectivity to more than 40,000 buildings worldwide. For
more information on MCI WorldCom, visit the World Wide Web at
http://www.mciworldcom.com

.

About Systemhouse

MCI Systemhouse, the Network Enterprise Company ^SM, is a global
information technology services company. MCI Systemhouse is one of the
industry's only single-source providers of convergence products and
services to enable businesses' total networking, communications,
and consulting and outsourcing needs. The company has 120 offices and
approximately 9,000 professionals worldwide. With a comprehensive suite
of network enabled IT solutions and services for the new millennium,
MCI Systemhouse serves major corporate, mid-sized and public sector
clients throughout North and South America, Europe and Asia.

About EDS

EDS has been a leader in the global information services industry
for more than 35 years. The company delivers systems and technology
expertise, management consulting, business process management and
electronic business leadership. EDS, which reported revenues of $16.9
billion in 1998, offers solutions to improve the performance of more
than 9,000 business and government clients in about 50 countries. The
company's stock is traded on the New York Stock Exchange (NYSE:EDS) and
the London Stock Exchange. Visit EDS via the Internet at
http://www.eds.com

.