CABLE & WIRELESS TO BEGIN SHOP SEARCH: SPENDING ON INTERNET ASSETS BOUGHT FROM MCI COULD REACH $30 MILLION

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Cable & Wireless Inc., newly armed with the acquired Internet assets of MCI Communications Corp., is becoming an object of desire for ad agencies scrambling for a telecommunications account.

The telco, owned by U.K.-based Cable & Wireless PLC, doesn't have an agency and is not yet actively seeking one.

But it is expected to begin a search soon, possibly in the fall, said an executive with knowledge of the situation.

Ad budget is uncertain; MCI spent more than $7 million in the first four months of 1998 on its Internet inventory, according to Competitive Media Reporting. Some executives estimated the telco's eventual spending could be $20 million to $30 million, and possibly more.

The company must wait until the merger of MCI and WorldCom is completed -- expected by the end of this month -- to take over the MCI assets.

BRANDING PUSH AHEAD?

Cable & Wireless is said to be thinking of hiring an agency for an aggressive branding and product push for the U.S. Internet properties, which include both network hardware and Internet access for customers.

The company is positioning itself as having one of the most powerful integrated data, voice and Internet businesses in the world.

A spokeswoman said the company was preparing marketing and advertising plans although it wasn't ready to talk about them.

Agencies with telecom experience said to be interested in the account include Berlin, Cameron & Partners, New York, led by Andy Berlin, who helped set up Focus GTE for DDB Needham Worldwide, as well as Saatchi & Saatchi, the former agency for Bell Atlantic Corp.

"The biggest problem everyone has in the telco category is fragmentation," said Avi Dan, Saatchi exec VP-business development. "The companies that will win are those companies that can brand themselves well."

`A HUGE OPPORTUNITY'

"MCI built a good Internet business through marketing, advertising and relationships with customers," said Jeffrey Kagan, president of consultancy Kagan Telecom Associates.

"Cable & Wireless needs to continue to do that, otherwise they just bought a bunch of wires," he said. "It's a huge opportunity, but it's not going to happen all by itself."

Contributing: Laura Petrecca.

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