INTERMEDIA COMMUNICATIONS ANNOUNCES MULTI-MILLION DOLLAR SERVICES AGREEMENT WITH CABLE & WIRELESS, INC.; Intermedia to Provide Switched Originating and Terminating Services for CWI

Business Wire, August 27, 1996

TAMPA, Fla.--(BUSINESS WIRE)--Aug. 27, 1996--Intermedia Communications Inc. (Nasdaq/NM: ICIX), a rapidly growing provider of integrated telecommunications services, today announced a two-year contract to provide Cable & Wireless, Inc. (CWI), the nation's largest long distance company exclusively serving businesses, with switched access termination and origination for interstate long-distance services.

The agreement, potentially covering up to 10 LATAs (Local Access Transport Areas), will be implemented initially in the Miami LATA beginning in November of this year. Terminating traffic alone from the Miami LATA is expected to generate approximately $4 million in revenue over two years. If fully implemented on a statewide basis, the contract will generate approximately $10 million per year for all originating and terminating minutes throughout the 10 LATA area. Full implementation statewide is expected to be completed in the second quarter of 1997.

In addition, Intermedia will assume full operational responsibility for CWI's network facilities for the Miami LATA, including entrance facilities, POP-to-POP services and special access services. As part of this operation outsourcing arrangement, Intermedia will integrate CWI's existing technical workforce with its own.

CWI's outsourcing of its interstate switched services in Miami to Intermedia, in addition to outsourcing of its network facilities, is based on the healthy long-term business relationship that has been built between our two companies," said David C. Ruberg, Intermedia's president, chairman and chief executive officer.

"This agreement will help accelerate CWI's entry into Florida's local calling market," said Gabe Battista, president and chief executive officer of CWI. "The agreement also enables CWI to streamline interstate long distance services while enhancing overall service quality and capability."

Intermedia will rely on its DMS-500 switching platform and recently negotiated interconnection agreements with BellSouth, GTE and Sprint/United to provide seamless statewide service for CWI. Intermedia operates advanced, digital switching centers in Miami, Tampa and Orlando with an additional switching center soon to become operational in Jacksonville.

"CWI has shown confidence that we can deliver services that will greatly enhance its ability to serve its customers throughout the country, using our state-of-the-art network platform and relying on the high-level professional capabilities of our people," Ruberg said.

Contract Expected to Involve Provision of Variety of Services

"Intermedia and CWI are also currently discussing broadening CWI's services with Intermedia for additional special access and private branded local dial tone services," Ruberg said. "The multilevel nature of our service capabilities is evidence of Intermedia's abilities to deliver as a `one-stop-shop' provider. We are proving over and over again our capabilities as an integrator of diverse but complementary telecommunications services for business and government end-users and long distance carriers."

In addition to terminating and originating switched services, Intermedia is expected to provide local switched services (local dial tone) to CWI, which will private brand and package these services with their own long distance service for resale to their business customers. This arrangement will enable CWI to offer its customers a cost-effective, reliable bundled service which will initially include PBX trunks and business line services. Future enhancements are to include Centrex and ISDN (integrated services digital network).

Cable & Wireless, Inc., the nation's largest long distance company exclusively dedicated to serving the needs of the business market, is owned by Cable and Wireless Plc (NYSE:CWP), one of the world's leading international telecommunications companies. Cable & Wireless, Inc. has been operational in the U.S. since 1975 and provides a wide range of domestic and international public and private networking services exclusively to businesses.

Intermedia Communications is a rapidly growing provider of integrated telecommunications solutions for business, government and the telecommunications industry. Intermedia is known for its ability to package customized, "no assembly required" solutions to meet each customer's specific requirements. The Company provides voice, data and video services; local and long-distance switched services; advanced access services in cities throughout the eastern U.S.; and enhanced data services, including Internet access, to business and government customer locations in over 900 cities nationwide and internationally -- offering seamless end-to-end connectivity virtually anywhere in the world. Intermedia is headquartered in Tampa, Florida, and is traded on the Nasdaq Stock Market's National Market under the symbol "ICIX." Intermedia's address on the World Wide Web is www.icix.net.

Statements contained in this news release regarding expected revenues are forward-looking statements, subject to uncertainties and risks, including, but not limited to, the demand for CWI's company's products and services, which may be impacted, among other things, by economic, competitive or regulatory conditions.