America Online, Bertelsmann, Canal+ and Cegetel Announce an Alliance in Internet Online Services in France

January 29, 1998

Paris, January 29, 1998 - America Online, Inc. (NYSE: AOL), Bertelsmann, Canal+ and Cegetel announced today that they have signed a memorandum of understanding to pool their Internet activities in the French market. Under the agreement, Cegetel and Canal + will jointly acquire a majority stake in AOL France and CompuServe France (pending the completion of the CompuServe Europe acquisition by America Online and Bertelsmann). Cegetel will convert members of its Havas On Line service to the new venture. Under the brand names 'AOL par Cegetel' -- aimed at the consumer market -- and 'CompuServe par Cegetel' -- designed for professional and small business users, the group will offer services via traditional telephone access. Under the brand name 'AOL Par Canal +' the group will offer a consumer brand delivered using cable and satellite technologies. The new entity -- combining AOL France, CompuServe France, and Havas On Line -- will total over 200,000 subscribers. Clearly positioned as the leading Internet online services provider in France, the service will be able to capitalize on the superior online technology and internationally recognized brands AOL and CompuServe, as well as the commercial dynamism of Cegetel. Today's announcement underscores the four partners' determination to accelerate growth in the French market by continuing to offer the best Internet online service in a package that is easy to use, convenient, and offers unique content unavailable elsewhere. The group believes that the French market, in particular, is poised for rapid growth. French consumers are just beginning to adopt this new interactive medium. Currently only 2% of the French population is connected to the Internet versus 6% in the UK, 7% in Germany, and 20% in the US. The aim of this agreement will also be to optimize the distribution of Internet online services through various available platforms : telephone, cable, and satellite. It will give prominent placement to original programming, produced by Canal+, including animated images. The parties intend to finalize their agreement over the next few weeks in order to deliver an offering to Internet users in the Spring of 1998. "This alliance brings together the four most innovative and dynamic partners in the field of telecommunications (Cegetel), Internet online services (AOL-Bertelsmann), and media (Canal+). It is a concrete and promising illustration of the strategy of Groupe General des Eaux in those areas and of the convergence of the worlds of telecommunications and content for the benefit of consumers," declared Jean-Marie Messier, President and CEO of Compagnie GÅnÅrale des Eaux and of Cegetel. "I am convinced that the technological expertise, the creativity, and the dynamism of the four parties involved will make AOL and CompuServe even more accessible, easy to use, and entertaining. This is a decisive step toward making the Internet a real mass medium in France within the next few years," declared Thomas Middelhoff, Member of the Executive Board of Bertelsmann AG. "The decision of these French entrepreneurial leaders in telecommunications and television to join us is an extraordinary affirmation of the potential of the Internet here in France and the growing strength of the AOL and CompuServe brands," declared Steve Case, Chairman and CEO of America Online, Inc. "We believe that this transaction will help us deliver the best possible interactive experience to consumers and business users in France by combining our services' convenience and ease of use with our French partners' knowledge of the market, infrastructure, groundbreaking content, and brand power." "The Internet today is a powerful tool of communication. But to become a real medium, some efforts are still required: to develop programs with a genuine structure and a specific style. This is an exciting challenge for Canal+, which has already developed the most popular content-driven web site in France. In addition, new digital cable and satellite platforms will allow the Internet to become much faster and user-friendly: for me, both as a service operator and as a net surfer, this is very good news. I am confident that the four partners in this agreement will be able to meet this challenge," said Pierre Lescure, Chief Executive Officer, Canal+.

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