NewsRelease 2004 Rakuten Communications Corp.

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March 25, 2004

PoweredCom, Inc.
Fusion Communications Corp.
Nissho Electronics Corporation

Fusion Merges its Telephone Business with PoweredCom

Fusion Communications Corporation and PoweredCom, Inc. reached a basic agreement on a merger of the two companies in telephone services on February 27, 2004 and had been pursuing talks to reach a final agreement that has now been reached. In the final agreement PoweredCom's telephone business will be merged with Fusion's business on July 1, 2004. The agreement involves three companies--PoweredCom, Fusion Communications, and Fusion's main shareholder, Nissho Electronics Corporation.

This merger in telephone services will maximize the two companies' management resources to establish a leading company that offers customers IP telephone services and other voice communication services. Various leading-edge services that incorporate Fusion's IP-phone know-how will be provided, utilizing the fiber optic networks owned by PoweredCom and other power-company-related carriers.

An outline of the merger is provided in the attached document.

(Attachment 1)

Outline of Business Merger and Company After Merger

1. Reason for the Merger

The voice communications business was founded on fixed-line telephone service, but the spread of mobile phones and the use of IP telephone services based on a rapid spread of broadband Internet connections have brought about a major turning point in the marketplace. Due to the lower fixed-line traffic in this environment, NTT East and NTT West have raised their access charges, strongly impacting the profits of interconnecting phone carriers.

PoweredCom and Fusion mutually recognized the need to quickly establish a system for providing next-generation services in response to these market changes as a key strategy for taking the lead in the voice communications market in the future. The two companies thus decided on a merger in telephone services to make most effective use of the management resources of both companies.

Fusion was the first company in Japan to build an IP telephone network and provide IP telephone services. PoweredCom is a power-company-related carrier that owns extensive fiber optic infrastructure, primarily in the Tokyo area. The merger of personnel, customers, and financial infrastructure is designed to boost competitiveness by taking full advantage of the fiber optic network to create a leading voice communication services company in a new age of "Everything over IP."

2. Schedule for Completion of the Merger

Merger review board created		Nov. 17, 2003
Basic agreement on merger reached		Feb. 27, 2004
Final agreement on merger reached		Mar. 25, 2004
Shareholder meetings for merger approval	PoweredCom	Apr. 22, 2004 (planned)
	Fusion	Apr. 22, 2004 (planned)
Completion of merger		July 1, 2004

3. Type of Merger

PoweredCom's telephone business division will be spun off and merged with Fusion's business operations.

4. Stock Allocation

Fusion will issue 104,027 new shares that will all go to PoweredCom. This will make PoweredCom the majority shareholder in Fusion with 54.27% of Fusion stock.

5. Company Outline after Merger

(1) Corporate name

Fusion Communications Corporation

(2) Head office

2-2-2 Urban Net Otemachi Building 13th floor
Otemachi, Chiyoda-ku, Tokyo
JAPAN 100-0004

(3) Business type

Telecommunications carrier

(4) Capital

10.575 billion yen

(5) Settlement term

March 31

(6) Board members
President and CEO
Four other directors

Tadahisa Sumida (undetermined at present)

(7) No. of employees

318 (estimated)
168 currently employed at Fusion
150 from PoweredCom's telephone business-related departments

(8) Major shareholders

PoweredCom, Inc.	54.27%
Nissho Electronics Corporation	21.62%
The Furukawa Electric Co., Ltd.	6.70%
Others	17.41%

(9) Post-merger business areas

Interconnecting phone service and dedicated-line telephone service
All services will be integrated in the future, but in the initial post-merger phase, in addition to Fusion's highly competitive long-distance telephone service, the same low rates for local telephone service offered by PoweredCom's Tokyo Denwa will be applied to local calls, offering customers even greater benefits.

IP subscriber telephone service
IP subscriber telephone service will be central to next-generation voice communication services and will replace fixed-line telephone service. Fusion will provide a voice platform and new voice communication services in the IP age utilizing the fiber optic networks of PoweredCom and other power-company-related carriers.

(10) Business plan
after merger

First fiscal year after merger (ending 3/2005)*
Net sales	78 billion yen
Operating profit/loss	-2.7 billion yen
Ordinary profit/loss	-3.5 billion yen

Second fiscal year after merger (ending 3/2006)
Net sales	99.5 billion yen
Operating profit/loss	3.0 billion yen
Ordinary profit/loss	2.1 billion yen

* (April - June 2004: Fusion nonconsolidated) + (July 2004 - March 2005: post-merger)