McLeodUSA Expands Voice Over Internet Protocol -VoIP- Integrated Acces

    Business Editors/High-Tech Writers

    CEDAR RAPIDS, Iowa--(BUSINESS WIRE)--Feb. 10, 2005--

    Preferred Advantage(SM) Dynamic Integrated Access Now Available for Sale to Business Customers Across McLeodUSA's 25 State Footprint

    McLeodUSA Incorporated (Nasdaq:MCLD), one of the nation's largest independent competitive telecommunications services providers, today announced that its Preferred Advantage(SM) Dynamic Integrated Access is now generally available for sale to business customers in 37 markets across the Company's 25 Midwest, Southwest, Northwest and Rocky Mountain state footprint, including the Denver, Dallas, Detroit and Chicago markets, which were launched late in 2004.
    "Preferred Advantage Dynamic Integrated Access combines voice and data services along with high speed Internet on one broadband connection for business customers, eliminating the need for separate access lines," said Chris A. Davis, Chairman and CEO of McLeodUSA. "In addition to improved business efficiency, increased productivity and lower total cost of ownership, our dynamic integrated access customers can control the features and functionality of their business communications. By utilizing the web-based control panel, customers can easily add or change features, generate reports and perform administrative tasks, real-time. This multi-state expansion also lays the groundwork for McLeodUSA to offer additional VoIP based services, which we plan to roll out later this year."
    Preferred Advantage Dynamic Integrated Access uses Voice-over-Internet Protocol (VoIP) on McLeodUSA's secure IP network to offer integrated voice and data communications services, over one single T-1 facility to each customer location. Customers receive up to 1.544 Mbps Internet access, high quality voice service, 17 local calling features, and the convenience of an easy-to-use web-based control panel. Multi-location customers will enjoy the benefits of abbreviated dialing and free site-to-site calling between all of their Dynamic Integrated Access served locations.
    "We chose the Dynamic Integrated Access from McLeodUSA to increase our communications efficiencies. Our Internet access is faster than ever before, we have experienced no downtime and it has allowed us to be a more efficient store," said Keith Sanders, Owner, UPS Store. "This product is great for companies that depend on Internet access to do their business. We are extremely impressed by the customer service provided to us and would consider McLeodUSA to help us solve communications challenges in the future."
    "Having high-quality voice and data services, and network reliability is critical to our business. With confidence in McLeodUSA's ability to meet our needs, we signed up for Dynamic Integrated Access and have been extremely pleased with the service," said Vincent J. Mattina Jr., Certified Public Accountant & Partner, Gofrank & Mattina, P.C. "McLeodUSA's commitment to quality, their responsiveness, and overall value proposition really convinced us they were the smart choice. We look forward to a long relationship with McLeodUSA."
    McLeodUSA plans to expand its VoIP enabled services during 2005. The Company provides business customers with a smooth migration path as they make the transition from traditional telephony to VoIP enabled solutions, allowing multi-location business customers to enjoy the benefits of increased productivity, reduced operating cost, and improved control regardless of location size or the current technology being used.
    Preferred Advantage Dynamic Integrated Access is now available for sale to business customers in Boise, Central Illinois, Chicago, Cleveland/Akron, Columbus, Dakotas, Dayton, Denver, Detroit, Flint/Saginaw, Grand Rapids, Green Bay, Gulf Coast (Houston), Indianapolis, Iowa, Kalamazoo, Kansas City, Lansing, Madison, Milwaukee, Minnesota, New Mexico, North Texas (Dallas), Northern CO, Omaha, Phoenix, Portland/Vancouver, Racine, Salt Lake City, Seattle, Southern CO, Spokane, Springfield, MO, St Louis, Tacoma, West Texas (Austin, San Antonio), Western CO. The Company expects all of these markets to be installation-ready for full service activation over the next few months.
    For general information on Dynamic Integrated Access and other McLeodUSA Preferred Advantage services, please contact a McLeodUSA Customer Care Representative at 1-800-593-1177 or visit the Company's website at www.mcleodusa.com.

    About McLeodUSA

    McLeodUSA provides integrated communications services, including local services, in 25 Midwest, Southwest, Northwest and Rocky Mountain states. The Company is a facilities-based telecommunications provider with, as of September 30, 2004, 38 ATM switches, 39 voice switches, 696 collocations, 435 DSLAMs and 2,474 employees. As of April 16, 2002, Forstmann Little & Co. became a 58% shareholder in the Company. Visit the Company's Web site at www.mcleodusa.com

    Some of the statements in this press release include statements about our future expectations. Statements that are not historical facts are "forward-looking statements" for the purpose of the safe harbor provided by Section 21E of the Exchange Act and Section 27A of the Securities Act. Such statements may include projections of financial and operational results and goals, including revenue, EBITDA, Adjusted EBITDA, profitability, savings and cash. In some cases, you can identify these so-called "forward-looking statements" by our use of words such as "may," "will," "should," "expect," "plan," "anticipate," "believe," "estimate," "predict," "project," "intend" or "potential" or the negative of those words and other comparable words. These forward-looking statements are subject to known as well as unknown risks and uncertainties that may cause actual results to differ materially from our expectations. Our expectations are based on various factors and assumptions and reflect only our predictions. Factors that could cause actual results to differ materially from the forward-looking statement include technological, regulatory, public policy or other developments in our industry, availability and adequacy of capital resources, current and future economic conditions, the existence of strategic alliances, our ability to generate cash, our ability to implement process and network improvements, our ability to attract and retain customers, our ability to migrate traffic to appropriate platforms and changes in the competitive climate in which we operate. These and other risks are described in more detail in our most recent Annual Report on Form 10-K filed with the SEC. The Company undertakes no obligation to update publicly any forward-looking statements, whether as a result of future events, new information or otherwise.

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CONTACT: McLeodUSA Incorporated, Cedar Rapids Press Contact: Karen Fox, 319-790-7800 McLeodUSA.PR@mcleodusa.com

KEYWORD: KANSAS IOWA INDIANA ILLINOIS IDAHO COLORADO ARIZONA WASHINGTON UTAH TEXAS SOUTH DAKOTA OREGON OHIO NORTH DAKOTA NEBRASKA MISSOURI MICHIGAN INDUSTRY KEYWORD: TELECOMMUNICATIONS NETWORKING INTERNET E-COMMERCE PRODUCT SOURCE: McLeodUSA Incorporated

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