Globo and Microsoft Announce Strategic Agreements and Investments To Develop and Deploy New Internet Services in Brazil.

SAO PAULO, Brazil & REDMOND, Wash.--(BUSINESS WIRE)--Aug. 16, 1999--

Agreements Include Investment in Globo Cabo S.A. and Creation

of a Joint Marketing and Technology Group

Organizacoes Globo and Microsoft Corp. today announced a series of agreements under which the companies will work together to accelerate the deployment of advanced broadband and Internet services to millions of Brazilian homes. Both companies share a vision for tangible benefits being provided to consumers through the combination of leading content, broadband digital networks, software and Internet technology. The Globo and Microsoft alliance is intended to foster the creation, delivery and operation of a set of joint services for PCs and advanced digital set-top boxes for Brazilian consumers. As a first concrete step in building this relationship, Microsoft will invest in Globo Cabo S.A., the leading cable television operator in Brazil.

Joint Marketing and Technology Group

The overall agreement between Organizacoes Globo and Microsoft is intended to establish a position of leadership on the Internet in Brazil. "The unique Portuguese-language content brought by Globo and the state-of-the-art technology from Microsoft can create a leading combination to translate into greater value for both our consumers and our shareholders," said Roberto Irineu Marinho, co-chairman of Organizacoes Globo.

The parties will create a joint Marketing and Technology Group that will be responsible for the study and development of joint projects. The initial business opportunities to be addressed are a joint portal, merging the existing MSN(TM) Brasil service and Globo's portal, Globo.com, which is currently under development; interactive TV services based on advanced set-top boxes using the Microsoft(R)TV platform; and the provision of Internet access services.

It is expected that the parties will work together to combine Globo's news, sports, entertainment and educational content with Microsoft's existing services including the MSN Hotmail(TM) Web-based e-mail service, MSN Messenger Service, MSN Web Communities, MSN search and directory, and Microsoft Passport services. "Microsoft believes in enabling the rapid roll-out of digital services to consumers," said Mauro Muratorio Not, general manager of Microsoft Brazil. "We are looking forward to the rapid deployment to the Brazilian market of next-generation digital services enabled by the combination of Microsoft's platform technologies and services with Globo's network and leading content."

Investment in Globo Cabo S.A.

Microsoft will make a US$126 million investment in Globo Cabo by acquiring newly issued ordinary and preferred shares at an average price of US$0.60 per share (US$6 per ADR-equivalent). In conjunction with the investment, Microsoft will be given the right to participate in the company's board of directors, among other governance provisions. "Microsoft's capital infusion and the broader strategic alliance will assist Globo Cabo in providing its subscribers with earlier access to a wide range of advanced services over its broadband network," commented Moyses Pluciennik, Globo Cabo's chief executive officer. "This investment is an important first step in our ongoing strategic recapitalization initiative." Globo Cabo currently has the most advanced cable network in Brazil, with two-way architecture that covers more than 4.5 million homes.

As part of a continuing strategic involvement with Globo Cabo, the investment agreement will provide Microsoft with the option to acquire additional Globo Cabo stock over the next three years. "Our agreement represents an important step in building a truly global Web lifestyle," said Mauricio Santillan Razo, regional vice president for Microsoft Latin America. "We are very excited to expand our existing relationship with Globo Cabo to new areas that will generate an even richer Internet and television experience for millions of people."

After the initial investment, the next planned step in the strategic alliance is the full-scale launch of Virtua, Globo Cabo's broadband high-speed Internet access service. This service, currently a fully operational commercial test using the Microsoft Commercial Internet System (MCIS) platform, is expecting approval from the Brazilian telecommunications regulatory authority in the near future.

About Organizacoes Globo

Organizacoes Globo is a group of companies controlled by the Marinho family, leaders in the media and entertainment businesses in Latin America. The companies are known for their capacity to produce a wide range of high-quality information and entertainment content. Among these companies are the leading broadcast television network Rede Globo; pay television channels including a 24-hour news and a sports channel, Globonews and SporTV; market-leading newspapers and magazines; a network of radio stations; and telecommunications companies. The Marinho family also sponsors the Roberto Marinho Foundation, which is dedicated to educational and cultural projects, including a 24-hour educational channel.

About Globo Cabo S.A.

Globo Cabo S.A. (Nasdaq "GLCBY") is the largest cable television operator in Brazil, with ownership interests in 18 cable television systems and one MMDS operation, including systems in Brazil's three largest cities: Sao Paulo, Rio de Janeiro and Belo Horizonte. All except one of these systems are located in southeast and central-west Brazil, the most developed and populous regions in the country. The controlling shareholders of Globo Cabo are Organizacoes Globo and Bradesco, the largest retail banking organization in Brazil.

About Globo.com Ltda.

Globo.com is the newest venture of Organizacoes Globo. The company will aggregate the multimedia content produced by the group's media companies in the Internet environment. The company will target Portuguese-speaking audiences around the world.

About Microsoft

Founded in 1975, Microsoft (Nasdaq "MSFT") is the worldwide leader in software for personal computers. The company offers a wide range of products and services for business and personal use, each designed with the mission of making it easier and more enjoyable for people to take advantage of the full power of personal computing every day.

Microsoft, MSN and Hotmail are either registered trademarks or trademarks of Microsoft Corp. in the United States and/or other countries. Other product and company names herein may be trademarks of their respective owners.

For more information from Organizacoes Globo: Jorge Nobrega, Director of Strategic Coordination, (5521) 540-2829, [e-mail] Leonardo Pereira, Director of Investor Relations and Corporate Planning, (5521) 540-4592, [e-mail]

For more information from Globo Cabo S.A.: Eric Chasser, Director of Finance, (5521) 540-4455, [e-mail] Fernanda Mourao, Head of Investor Relations, (5521) 540-4434, [e-mail]

For more information from Microsoft, financial analysts only: Carla Lewis, Senior Director of Investor Relations, [phone], [e-mail] Osvaldo Barbosa de Oliveira, Director of Internet Businesses, [phone], [e-mail]

For more information from Microsoft, press only: Jodie Cadieux, Waggener Edstrom for Microsoft, (408) 986-11450, [e-mail] Jose Luiz Schiavoni, S2 Comunicacoes, (5511) 253-1930, [e-mail]

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