April 24, 1996

NYNEX CONTACT: Media Relations, (212) 395-0500

NYNEX Signs First-Of-Its-Kind Agreement With Long Distance Vendor - Describes Long Distance Strategy

NEW YORK, N.Y. -- NYNEX (NYSE:NYN) today announced it has signed a unique agreement with Sprint Communications Company, L.P. that will enable NYNEX to quickly enter long distance markets, including the $10 billion market in its own home region.

The agreement is part of NYNEX's plan to rapidly provide a full array of long distance services to customers throughout its Northeast service area as well as in select domestic and international markets outside its region.

Under the terms of the two-year contract, NYNEX will purchase a comprehensive set of network, customer care, billing and telemarketing services and use these to sell domestic and international long distance services. The contract also gives NYNEX the flexibility to develop and package with its long distance service a broad array of other value-added services.

"Our agreement with Sprint is more comprehensive and flexible than conventional long distance resale agreements, and it allows us to enter the market with world-class capabilities and world-wide reach," said Robert T. Anderson, NYNEX vice president - Business Development, who is also president of NYNEX's long distance subsidiary.

"By using Sprint's infrastructure, we'll enter the market as a lean and efficient operation," Anderson said. "Furthermore, the agreement provides a cost structure that will enable us to have the pricing flexibility required to be competitive in the long distance market."

Of equal importance, the contract spells out a specific set of service standards and ensures that NYNEX will be in a position to provide the best value and service offered in the market. NYNEX also has at its discretion the option to take over portions of the customer care and network functions provided by Sprint.

NYNEX and Bell Atlantic, which yesterday announced a definitive agreement to merge, are pursuing parallel plans for entry into long distance. For its part, NYNEX is taking a three-pronged approach to the market: targeted "out-of-region," international, and "in-region."

Targeted "Out-of-Region" Markets Will Be First

NYNEX is well positioned to succeed in the long distance business because of market advantages unique to its six-state service area, particularly the high volume of international long distance traffic as well as the affinities that certain groups of callers from outside the region have with the Northeast.

"Millions of people worldwide, such as 'snowbirds' or many national or multinational businesses, have a personal or business relationship with someone in the NYNEX region, which provides us with a unique competitive opportunity," Anderson said. "Our opening strategy is to quickly take advantage of this fact."

NYNEX expects to offer long distance service within the next three months, pending regulatory approvals, in six states: Arizona, California, Florida, Georgia, Illinois, and Texas. These states account for more than one third of all domestic long distance traffic terminating in the Northeast.

"We will use a targeted marketing program rather than mass marketing to reach out-of-region customers, and we will offer them value-added packages of products and services based on the high volume of their communications into the region," said Anderson.

"This marketing strategy focuses on selected high-margin segments, not overall market share," he said. "Combined with our use of the Sprint infrastructure, this marketing strategy will allow rapid entry with minimal investment and low operating costs -- which will enable NYNEX to maximize the contribution to earnings from long-distance."

International Call Volumes are NYNEX's Advantage

On Feb. 23, NYNEX became the first Regional Bell Operating Company (RBOC) to file to provide international long distance service, which has the most rapid growth and the highest margins in the long distance market. More than 20 percent of U.S. international calling originates in the NYNEX region, representing an opportunity of approximately $3.0 billion a year.

The NYNEX territory is a magnet for international business and travel. "Nearly one-third of New York City's residents were born in other countries, and our region shares a long border with the most populated provinces of Canada," said Anderson. "We can help people maintain their personal and business ties between the northeastern United States and their home countries."

NYNEX expects to begin providing "out-of-region" international service this summer, and will offer international service to customers within its region when it receives the necessary approvals.

Early Entry into the "In-Region" Market

The Telecommunications Act of 1996 requires RBOCs to meet a "checklist" of items that open their local networks and markets to competition before being permitted to offer long distance service to customers in their regions.

"NYNEX is already ahead of other RBOCs in meeting the 'checklist' requirements because of the progressive steps we have taken to foster competition," Anderson said. He said that NYNEX will be operationally ready to begin offering long distance service in New York by October. The company also plans to offer services in Massachusetts by June of next year, and in the rest of its seven-state home region no later than December 1997.

NYNEX's goal, Anderson said, is to capture 20 percent of the $10 billion in-region long distance market within five years. This market, he estimated, is growing at more than eight percent a year.

NYNEX is a global communications and media company that provides a full range of services in the northeastern United States and high-growth markets around the world, including the United Kingdom, Thailand, Gibraltar, Greece, Indonesia, the Philippines, Poland, Slovakia and the Czech Republic.

The Corporation is a leader in the telecommunications, wireless communications, cable television, directory publishing and entertainment and information services.

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