MCI Communications Corp. and American Express Co. are completing plans to launch a nationwide joint-marketing agreement that would enable MCI to bill the credit firm's 9.5 million cardholders directly, officials of the two firms said yesterday.
In addition, American Express is planning a major mass-marketing campaign for MCI's cut-rate long-distance telephone service, with mailings to about six million of the credit card giant's customers. All American Express customers will be eligible to use the service, however.
The two firms are near agreement on the deal, which comes after a several-month test of the joint-marketing arrangement. Formal announcement of the agreement is expected within days, and the service is expected to be launched early next year.
A test which began late last year involved mailings to about 120,000 American Express customers. That program produced a subscriber response of between 3 percent and 4 percent, good enough to enable the two firms to agree to an open-ended long-term relationship, an MCI spokesman said.
MCI will get the benefit of the mass-mailing campaign, and American Express will receive a percentage of the billings, the spokesman said. In addition, MCI subscribers who use the American Express system will receive a 20 percent reduction in MCI's monthly $10 or $5 service charge.
In another development, MCI also announced that it has asked the Federal Communications Commission for authority to build and operate the firm's first digital data network.
The network will link 46 cities, including Washington and other major metropolitan areas, in a network that the company said will cost about $35 million to build. The move is the first step in what is expected to be a significant expansion of MCI's data services for business. Currently the company's sales figures break down to about 95 percent for voice or conventional telephone service and 5 percent for data services.