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To: Anthony Wong who wrote (3583)	12/15/1998 1:18:00 AM
From: S. HYDER	Read Replies (1) \| Respond to of 11568

WCOM and EDS mull joint venture. biz.yahoo.com

To: Anthony Wong who wrote (3583)	12/15/1998 6:52:00 PM
From: Mazman	Read Replies (1) \| Respond to of 11568

More on Possible EDS Deal EDS May Buy Part Of MCI Systemhouse InternetWeek 12/15/98, 3:36 p.m. ET, by Kate Gerwig Last week's joint venture involved AT&T buying IBM's Global Network, as well as outsourcing its data-center management to IBM in exchange for running IBM's internal network. A neat network-for-IT-services swap. This week, two other major players may be doing a similar dance. According to today's Washington Post, MCI WorldCom and EDS, one of the world's largest information outsourcing-services companies, are talking about a joint venture of their own, another telecommunications-for-IT services swap. According to the Post's story, EDS may buy part of MCI Systemhouse, MCI's computer systems-integration company. If the reported deal goes through, MCI WorldCom may outsource management of its internal billing and information systems to EDS, which could mean thousands of MCI employees would transfer to the Plano, Texas-based company originally founded by Ross Perot, then bought and spun off by General Motors. Another piece of the deal could result in outsourcing the bulk of EDS customers' communications needs to MCI WorldCom, according to the Post. According to an unnamed source at MCI WorldCom, the terms of a deal are not final, but could be worked out within two weeks. MCI and EDS have not commented on the proposed deal. Before its merger with WorldCom earlier this year, MCI acquired SHL Systemhouse in 1995 for $1 billion. The unnamed source said MCI WorldCom has outgrown Systemhouse and needs a larger company like EDS to help integrate the back-end systems of the more than 50 companies acquired under MCI WorldCom CEO Bernard Ebbers. WorldCom vice chairman John Sidgmore said repeatedly last year that acquiring Systemhouse was a major driver for the $43 billion MCI WorldCom merger, though industry analysts said MCI already was trying to sell the company. Many of the 8,000-plus MCI WorldCom employees who handle IS could be transferred to EDS to continue running the systems, a scenario common in past EDS deals. Of an estimated 100,000 EDS employees, almost one-third have come to the company from outsourcing deals. MCI WorldCom had reportedly been talking with IBM about outsourcing its billing and computer-systems management, as well, before AT&T announced its own deal with IBM. Up to 5,000 IBM employees will transfer to AT&T to run the global network, and up to 2,000 AT&T employees will transfer to IBM to run AT&T's data systems.