KPNQwest and IBM in EUR 4 Billion European Cybercentre Hosting Alliance

Largest-ever Pan-European Hosting Deal

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LONDON - 04 Apr 2000: -- KPNQwest and IBM today announced a ten-year initiative to deliver next generation e-business services and applications throughout Europe. At the core of the initiative is the creation and deployment of the most extensive and sophisticated network of Web hosting centres, called KPNQwest CyberCentres. The hosting alliance, believed to be the largest of its kind in Europe, is expected to generate more than EUR 4 billion in revenues, to be split equally between the two companies.

KPNQwest has selected IBM Global Services to build, manage and provide operational support for up to 18 new KPNQwest CyberCentres connected to KPNQwest's high capacity fibre-optic EuroRings network. IBM will lease 25% of the available space in the centres to host their customers' e-business and business-to-business (B2B) initiatives.

The first six KPNQwest CyberCentres, each of about 10,000 square metres, will be in Frankfurt, Paris, Munich, Stockholm, Milan, and London. These centres will be phased in by the end of 2000. Typical customers for the range of services offered by KPNQwest and IBM within the CyberCentres are Internet Service Providers (ISPs), Application Service Providers (ASPs), dot.com companies, small and medium enterprises (SMEs), multinationals, traditional 'bricks and mortar' companies moving to web-based operations and organisations involved in e-commerce.

Commenting on the alliance, Jack McMaster, CEO and President KPNQwest, said:
"This initiative demonstrates that the predicted convergence of next generation network and IT services is happening in Europe. The combination of IBM's industry-leading IT services and KPNQwest's modern fibre-optic network and CyberCentres will accelerate the ability for Europe's businesses to offer improved services and e-commerce solutions."

Frank Kern, general manager, Professional Services, of IBM Global Services Europe Middle East and Africa, said: "The e-business hosting and B2B network services market in Europe is exploding and is expected to be worth Euro 55 billion by 2003. IBM will draw on our experience in managing 133 data centres around the world to ensure this agreement with KPNQwest is successful in providing companies across Europe with the bet-your-business support they need. Our alliance with KPNQwest demonstrates how leaders in the information technology and communications industries can collaborate to help companies worldwide become
e-businesses."

Customers will benefit from a full portfolio of next generation e-business network and hosting services. These range from managing and operating customer servers in the centres, to hosting complex websites and building new network-based applications for larger customers. The CyberCentres will provide complex hosting services to large and medium customers and co-location capabilities for the high-growth market of customer managed services as well as IT and application support services. In addition, they will provide a full range of network services, such as managed bandwidth, Internet connectivity and IP (Internet Protocol) transit under strict service level agreements.

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