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2Way Web Services Enable Companies to Complete More Internet Transactions at a Lower Cost Per Transaction


SAN FRANCISCO, October 4, 2001 - Digital Island, Inc., a Cable & Wireless company (LSE: CW, NYSE: CWP), today launched 2Way Web Services to help enterprises increase the profitability and performance, and decrease the cost of their online operations. As a new wholly owned subsidiary of Cable & Wireless, Digital Island will leverage the company's industry-leading global IP backbone and manage the combined hosting facilities of Cable & Wireless to offer an enhanced, more robust portfolio of Web infrastructure services that enable companies to drive the profitability of their e-businesses.

As the 2Way Web Services arm of Cable & Wireless, Digital Island will operate and manage a standardized portfolio of Web services that include all the managed hosting and content delivery needs of current and future customers. Digital Island is also announcing new customers of its 2Way Web Services including Cisco Networking Academy, Pearson and Walt Disney Internet Group.

The Cisco Network Academy is using Digital Island's 2Way Web Services to deliver education and IT training to more than 200,000 students worldwide. Walt Disney Internet Group is using 2Way Web Services to handle flash crowds at web sites such as ESPN.com, and Digital Island has been appointed Web Services partner for the following Pearson companies: FT Group, Pearson Education, and the Penguin Group.

2Way Web Services are reliable, secure and global infrastructure services that support multiple Internet business models including ad driven, pay to view, pay to download and subscription based services. The portfolio of services support many transactional applications that require end users to complete exchanges of customized content and require both edge and/or decentralized computing resources from a content delivery network and/or from managed hosting facilities, and a private global network. Some of these applications include online purchase, payment and fulfillment of goods and services, user verification and authentication, search query or account balance inquiries.

2Way Web Services are modular in nature and can be assembled to uniquely meet the needs of customers with highly interactive and transaction-oriented application requirements. Because 2Way Web Services are modular and able to be customized, other web services from Digital Island or other companies can be easily accommodated, which further lowers the development costs associated with ongoing e-business initiatives. As a result, 2Way Web Services help reduce lifecycle costs associated with conducting e-business.

Digital Island's 2Way Web Services reduce costs by leveraging the economies of scale gained through Cable & Wireless' tier-1 backbone network reaching 70 countries, a combined one million square feet of data center capacity and Digital Island's over 2600 edge servers in 35 countries. By using the company's Footprint. Service Enabling Technology, the optimal mix of distributed delivery (through the content delivery network), or centralized resources (in the managed hosting data centers), can be invoked to serve content in a more cost effective manner regardless of popularity, and deliver excellent end user experiences.

"Enterprise companies are looking for ways to reduce costs and increase revenue streams from their online operations. This means increasing the number of completed transactions for less, and providing the best, most reliable service possible," said Ruann Ernst, president and chief executive officer, Digital Island. "With Digital Island's 2Way Web Services, we are supporting more than $1 billion of transactions a day for our customers and helping companies not only increase profitability, but also build brand loyalty and get the most out of their online service offerings."

According to Gartner Inc., Web services are the cornerstone for building next-generation software systems essential to enterprises achieving a winning competitive edge and more efficient and cost-effective operations. (1)


According to Robert Batchelder, research director, Gartner, Inc.,


"As Web services evolve, content, transactions and application systems will be increasingly distributed across global networks.
Sophisticated network providers must keep pace with this trend, by offering a full range of connectivity, managed hosting, content delivery, transaction processing, and operational management services. Globally connected companies will increasingly rely on such services in order to maximize the return on their Web services investment."

Specifically, the complete 2Way Web Services platform is comprised of three core service offerings; 2Transact, 2Deliver, 2Manage, and two core methodologies, 2Design and 2Operate.

2Transact Services enable more transactions to be completed at lower costs. 2Transact Services include Managed Hosting Services, Secure Connectivity, Pay per View, Pay to Subscribe Services, Global IP Backbone, Security Services, Storage, Application Management and Database Administration. All of these services allow companies to deliver fast, global, secure and reliable two-way online purchases and transactions and complete more online transactions, helping to increase and sustain high profit margins and lower the cost per transaction.

2Deliver Services reduce the cost of delivering content and improve the end user's experience with content. 2Deliver leverages both centralized and distributed edge computing resources to ensure companies deliver a compelling online experience by improving speed, enhancing the quality of multimedia applications, expanding coverage, augmenting capacity on an as needed basis and providing control in the form of identifying and flagging content, all in a secure and guaranteed setting. 2Deliver Services include: Content Delivery, Live and on Demand Streaming Media, Signal Acquisition, Encoding, Synchronized Multimedia, Audio/Visual Production, and Managed Hosting and Network Services.

2Manage Services enable companies to track end user behaviors, customize and control the distribution of digital content and ensure the content is constantly updated and available to users across the globe. 2Manage Services include: Digital Rights Management, Geographic Targeting, Content Management and Monitoring, Streaming Media Management and Content Preparation and Content Delivery Services.

In the 2Design process, Digital Island's account management and professional services team works with the customer to produce the specifications of the 2Way Web Services required. Outputs of the 2Design process include computing hardware/software specifications, networking requirements, finance terms, security requirements, test plans, installation requirements and operating plans. 2Design partners include hardware and software services companies including Cisco, Compaq, EMC, Microsoft, Real Networks and Sun Microsystems.

The 2Operate process entails working with a company's IT staff to install and operate the 2Way Web Services according to the systems specifications agreed to in the design process. Components of the 2Operate process include execution against service level agreements, portals for customer monitoring and controlling service delivery and related billing services. 2Operate Partners include BMC Software for application and computing monitoring, HP OpenView for alarm collection and management and Keynote for end user experience measurement.

The underlying technology components of Digital Island's 2Way Web Services include Footprint. Service Enabled Technology, which includes a number of technology components including transport, traffic management, content management, control systems and peering systems. All core components of Digital Island's 2Way Web Services are immediately available.

(1) Gartner Inc., "Web Services: The Internet's 'Operating System", D. Plummer, June 2001.


Important Notice:

Digital Island, the Digital Island logo and Footprint are registered trademarks of Digital Island, Inc., a Cable and Wireless company. 2Way Web Services, 2Transact services, 2Deliver services and 2Manage services are trademarks of Digital Island, Inc., a Cable and Wireless company. All other marks are property of their respective owners.


This news release contains certain forward-looking statements, including, without limitation, statements concerning Cable & Wireless' and Digital Island's operations, economic performance and financial condition. These forward-looking statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of their dates. Actual results could differ materially from the results referred to in the forward-looking statements. These forward-looking statements are based largely on Cable & Wireless' and Digital Island's current expectations and are subject to a number of risks and uncertainties, including, without limitation, changes in external market factors, changes in business or growth strategy or an inability to execute strategy due to changes in such company's industry or the economy generally, the emergence of new or growing competitors, various other competitive factors and other risks and uncertainties indicated from time to time in Cable & Wireless' and Digital Island's filings with the U.S. Securities and Exchange Commission. In light of these risks and uncertainties, there can be no assurance that the results referred to in the forward-looking statements contained in this news release will in fact occur. Additionally, neither Cable & Wireless nor Digital Island makes any commitment to disclose any revisions to forward-looking statements, or any facts, events or circumstances after the date hereof that may bear upon forward-looking statements.


About Digital Island

Digital Island., a Cable & Wireless company, is the industry's first provider of 2Way Web Services that enable enterprises to leverage the Internet to increase the profitability of online operations, increase customer value and decrease costs. Digital Island provides robust managed hosting, content delivery and network infrastructure and applications required to transact, deliver, and manage profitable transactions and interactions. As a Cable & Wireless company, Digital Island operates data centers in the United States, Asia-Pacific region and Europe and has a global content delivery network that reaches more than 35 countries worldwide. Digital Island also leverages Cable & Wireless' advanced IP network reaching 70 countries.

Digital Island is headquartered in San Francisco. http://www.digitalisland.net


About Cable & Wireless

Cable & Wireless is a major global telecommunications business with revenue of over #8 billion (US$11 billion) in the year to 31 March 2001 and customers in 70 countries. Cable & Wireless' focus for future growth is on IP (Internet Protocol) and data services and solutions for business customers. It is developing advanced IP networks and value-added services in the US, Europe and the Asia-Pacific region in support of this strategy. With the capability of its global IP infrastructure and its strength in key markets, Cable & Wireless holds a unique position in terms of global coverage and services to business customers.

For more information about Cable & Wireless, go to http://www.cw.com


Contacts:

Laura Stadler, Media +1 415 738 4774, lstadler@digisle.net

Lyndsay Barrett, UK Media +44 (0) 20 7716 5878, lbarrett@digisle.net

Nicola Porter, Cable & Wireless Media:: +44 (0) 20 7315 4031, nicola.porter@cw.com

Valerie Gerard, Investor Relations (Cable & Wireless)


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