Contact:
Katharine Hanley
Director, IR/PR
Magic Software Enterprises Ltd.
(949) 250-1718 ext. 220
khanley@magic-sw.com



MAGIC SOFTWARE ENTERPRISES
RELEASES MAGIC eCONTACT(tm) Version 2

Call Center Solution Provides Ability to Drive 
Targeted Marketing Campaigns 
in Rapid Response to Market Changes


IRVINE, CA (January 23, 2001) - Magic Software Enterprises (Nasdaq:
MGIC), a leading provider of state-of-the-art application development
technology and business solutions, released today Magic eContact(tm)
Version 2.  This latest version of Magic eContact, available
immediately worldwide, is a highly functional, integrated desktop
application that provides contact center agents the professional tools
needed to efficiently and cost-effectively manage customer
interactions, including the ability to drive targeted marketing
campaigns in rapid response to market changes.

According to research recently published by the Forum Corporation, the
average business loses between 15 to 35% of its customers annually,
with 69% of these defections coming from poor sales or service
interaction.  With this newest version of Magic eContact, companies
are able to resolve these problems almost instantaneously and at
substantially reduced cost.

Businesses can implement their customer relationship management (CRM)
philosophies at the contact center level without the need for
expensive and time-consuming programming.    In addition, the
solution's dynamic design gives the contact center manager the power
to rapidly modify any variable - from the smallest data item to the
most complex business rule - without the need for coding.

"Magic eContact gives us maximum flexibility to manage our wide range
of projects, complete control over all the processes involved, and the
ability to respond rapidly despite the huge volumes of data we deal
with," said Bart Friedland, vice president of operations for Beeper
Communications.

One of Magic eContact's key features is its dynamic scripting engine,
which guides agents through all conversational phases.  The scripting
mechanism allows the agent to give customers personalized attention
and improved service based on the customer's unique profile.  Magic
eContact also solves the high turnover and associated training issues
that challenge most contact centers by providing a short learning
curve and user-friendly functionality.

"Magic eContact offers a combination of high-performance at reasonable
cost -- including the elimination of costly programming, a fast
learning curve for new contact center agents, an implementation
process that is among the shortest and simplest in the industry, rich
functionality, easy integration with existing applications, and the
ability to rapidly respond to market changes," said David Leichner,
vice president of worldwide marketing for Magic.  "While many contact
center solutions perform well on one or two of these features, I know
of no other commercial product that combines all these features under
one umbrella."

Already, Magic has implemented the solution at numerous sites
worldwide in a wide range of industries, including publishing,
insurance, communications, call center outsourcing, etc.  For more
information on Magic eContact, visit the Company's Website at
http://www.magicsoftware.com/econtact.

About Magic Software Enterprises
Magic Software Enterprises, a member of the Formula Group (Nasdaq:
FORTY), develops, markets and supports software development and
deployment technology that enables enterprises to accelerate the
process of building and deploying applications that can be rapidly
customized and integrated with existing systems.  Magic technology,
applications and professional services are available through a global
network of subsidiaries, distributors and Magic solutions partners in
approximately 50 countries.  The Company's North American subsidiary
is located at 1642 Kaiser Avenue, Irvine, Calif., 92614, telephone
(949) 250-1718, fax (949) 250-7404, http://www.magicsoftware.com.

The Formula Group is an international information technology company
principally engaged, through its subsidiaries and affiliates, in
providing software consulting services, developing proprietary
software products and producing computer-based solutions.

Except for the historical information contained herein, the matters
discussed in this news release include forward-looking statements that
may involve a number of risks and uncertainties.  Actual results may
vary significantly based upon a number of factors including, but not
limited to, risks in product and technology development, market
acceptance of new products and continuing product conditions, both
here and abroad, release and sales of new products by strategic
resellers and customers, and other risk factors detailed in the
Company's most recent annual report and other filings with the
Securities and Exchange Commission.