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Transaction Will Create New Generation Communications
Company; Single Source For High-Speed Internet Services and
Low-Cost Dial Tone For Businesses

ENGLEWOOD, Colorado and SAN JOSE, California, October 13,
1997 - ICG Communications, Inc. (NASDAQ: ICGX, "ICG"), one
of the United States' largest independent competitive local
exchange carriers (CLEC), announced that it has entered into
a definitive agreement and plan of merger with NETCOM
On-Line Communication Services, Inc. (NASDAQ: NETC,
"NETCOM"), a leading provider of Internet services.

"This merger combines a dynamic local service company
operating an extensive fiber optic network with a pioneer in
the Internet industry and one of the strongest brand names
in the country," said J. Shelby Bryan, President and CEO of
ICG. "Together, the combined company will have a broader
product and service offering ranging from dial tone to
Internet access and Web page hosting and support -- all from
a single provider. We're delighted that we have been able to
reach this agreement."

The merger, which is structured as a tax-free transaction
between NETCOM and a subsidiary of ICG, will create a
full-service business communications company providing a
single source for a complete range of voice, data, Internet,
Web hosting and other communications services over an
extensive fiber optic network. The new, combined company
would have more than $420 million in quarterly annualized
revenue on a pro forma basis, based on second quarter

NETCOM's Internet solutions for small and medium-sized
businesses together with ICG's clustered fiber and switched
networks are expected to enhance revenues, reduce costs and
increase profitability driven by merger synergies that take
advantage of the significant geographic overlap of ICG's and
NETCOM's respective customer bases. Currently, approximately
50 percent of NETCOM's customers are located in ICG's
existing network territory. In addition, approximately
140,000 NETCOM customers are located in California where ICG
has its largest statewide fiber optic network. Consequently,
it is anticipated that the merger will enable the combined
entity to better utilize ICG's fiber and frame relay

The merger is also expected to provide the combined company
with the ability to provide broader product offerings to
existing and future customers. For example, ICG will be able
to market voice services to NETCOM's customer base while
simultaneously offering data and Internet services to ICG's
voice service customers.

"The merger of ICG and NETCOM offers a strategic fit
across-the-board in technology, target markets and
geography," Bryan continued. "The new company will enjoy a
particularly strong competitive advantage in California,
where approximately 30 percent of the world's Internet
traffic either originates or terminates. ICG is fully
committed to serving this market, and we expect to have at
least 3,000 fiber miles in service in California alone by
the end of the year."

Bryan added, "It is significant that over 54% of NETCOM's
current operating costs are for line charges and related
telecommunications services. Consequently, as we transfer
NETCOM traffic to ICG's growing network, we expect to
achieve cost savings that will improve operating margins and
enhance cash flow of the combined company."

Chairman and CEO of NETCOM, David Garrison said, "We believe
that the true value of our data/Internet offering can be
better utilized by pairing it with a state-of-the art voice
communications solution. Upon the closing of the merger our
customers will soon be able to have all their communications
requirements met by one company with one bill. We believe
this merger is an excellent match, not only in our service
offerings, but also in our shared vision and entrepreneurial
spirit. We believe our customer bases, shared geographic
operations and complementary service offerings will create a
new, world-class force in this era of increased

Garrison concluded, "With the addition of NETCOM's Internet
and Web services, ICG - when our companies combine - should
be in an even stronger position to compete with the local
phone companies for market share. We are looking forward to
working closely with Shelby Bryan and ICG to take advantage
of the numerous opportunities that we now have."

The combined company will be served by more than 2,600
employees and will have a network platform interconnecting
330 Internet Points-of-Presence, over 40,000 dial-in access
ports, 18 telephony switches, 15 frame relay switches and
nearly 2,900 fiber route miles -- with an additional 1,117
fiber route miles under construction.

Under the terms of the agreement, NETCOM stockholders will
receive a fixed exchange ratio of 0.8628 shares of ICG
common stock for each NETCOM share held, subject to
adjustment as described below, at the time of the merger.
Based on the closing price of ICG common stock on October
10, 1997, the market value of the transaction is
approximately $283.5 million or $22.65 per share of NETCOM
common stock. The fixed exchange rate pricing mechanism will
allow NETCOM's stockholders to share in any increases in
ICG's stock prior to closing. In addition, the agreement
provides NETCOM stockholders with certain protections in the
event of a decline in the price of ICG stock. If the closing
price of a share of ICG common stock at the time of merger
(based on the average of the volume weighted average price
of the stock for the ten consecutive trading days ending two
trading days prior to the closing) drops below $22.125 per
share, but is greater than or equal to $19.00 per share, the
exchange ratio will convert to a fraction determined by
dividing 19.0625 by the ICG closing stock price (or a fixed
price of $19.0625 per NETCOM share). Additionally, if the
closing stock price of a share of ICG common stock were to
drop below $19.00 per share, the pricing structure would
convert to a fixed exchange ratio of 1.0078 shares of ICG
common stock for each share of NETCOM common stock. The
merger is expected to close in the first quarter of 1998,
pending approval by the stockholders of both companies and
other regulatory entities.

NETCOM is one of the leading Internet service providers in
the country with a world-class reputation for serving
business customers effectively by providing practical and
flexible Internet connectivity and Web- hosting services as
well as a suite of software applications targeted at the
professional, small and mid-sized business markets. All
services are backed by an expansive high-speed network and
year-around 24-hour expert support. NETCOM currently
provides service to approximately 550,000 customers, and has
become a significant force in the business market, providing
Internet and Web services to over 9,000 professional
businesses. The company was named PC World Internet Provider
of the Year for two out of the last three years. Additional
information on the Company can be found at

ICG has extensive fiber-optic networks and offers local,
long distance and enhanced telephony and data services in
California, Colorado, the Ohio Valley and parts of the
Southeastern United States. ICG is a leading national
competitive local exchange carrier (CLEC) publicly traded on
the Nasdaq National Exchange under the symbol "ICGX." The
operations of ICG Communications, Inc. consist of ICG
Telecom Group, ICG Fiber Optic Technologies and ICG
Satellite Services. Telecom Group is ICG's CLEC and enhanced
services business. Fiber Optic Technologies provides network
integration and support services. Satellite Services
provides maritime telecommunications network and
international end-to-end voice and data services, and
operates VSAT (very small aperture terminal) private data
networks. Further information is available on the company's
Website located at

Information and statements in this press release contain
expressed or implied forward-looking disclosures that are
based on the beliefs of management as well as assumptions
made based on information currently available to management.
These forward-looking statements and information involve
risks and uncertainty, including, but not limited to, the
possibility that the merger may not be completed if one or
more of the conditions of the closing are not met, future
demand for the company's services, general economic
conditions, government regulations, competition and customer
strategies, capital deployment, the impact of pricing and
other risks and uncertainties. Should one or more of these
risks materialize, or should underlying assumptions prove
incorrect, actual results may vary materially from those
described herein as anticipated, believed, estimated or
expected. Please see the documents filed by each of the
companies from time to time with the Securities and Exchange


NETCOM On-Line Communication Services, Inc. provides
high-quality, premium-priced, technology based solutions
that enhance customers' effectiveness and efficiency.
Leveraging years of Internet experience, NETCOM simplifies
technology for customers by providing practical solutions
ranging from supporting their company web presence to
providing tools that ease access to relevant information and
improve communications. All services are backed by the
Company's expansive high-speed network and year-round
24-hour expert support. Additional information on the
Company can be found at


NETCOM On-Line Communication Services is a registered
trademark of the Company.

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