Microsoft Invests $50 Million In Concentric

Industry heavyweights Concentric
Network Corp. and Microsoft
Corp. Tuesday expanded their relationship to
develop broadband content.

The initiatives are a part of Concentric’s commitment to establish a
co-branded version of the MSN portal for broadband Internet subscribers.

Microsoft will invest $50 million in Concentric and extend their initial
agreement for Concentric to provide networks services for WebTV Networks Inc. for two more years.

Concentric also signed a $7.5 million deal to advertise and promote its
services throughout the MSN network and to co-market its Microsoft Windows NT hosting services.

As key component of the business relationship, Concentric will establish a
co-branded portal version of the MSN site for its dial-up subscribers. MSN
content and services will be integrated into the site with Concentric’s
content and services. The demand for broadband services is the driving
force behind the creation of this specialized portal.

Henry Nothhaft, Concentric’s chairman, president and chief executive officer, said integrating Windows NT with DSL will create a powerful combination of services for small and
medium-sized companies.

Concentric will offer the MSN Hotmail Web-based
e-mail service as its preferred electronic-mail service for dial-up
subscribers. Microsoft and Concentric will also work together to offer a
co-branded MSN portal focused on DSL for Concentric’s small business
customers.

Thomas Koll, vice president of Microsoft’s network solutions group said Microsoft’s expanded relationship with Concentric will help it deliver a wide
range of next-generation services to their growing customer base.

As a part of the deal Concentric plans to launch several new hosting
services based on Windows NT Server technology and Microsoft BackOffice
server products, later this year. Microsoft will assist Concentric in the
development of application hosting services based on Microsoft programming.