ANDA Networks Launches into Multi-Services Access Market; ANDA to Provide Substantial Cost Savings, Integrated Service Delivery, Carrier-Proven Technology.

SANTA CLARA, Calif.--(BUSINESS WIRE)--May 10, 1999--

ANDA Networks, a one-year old Silicon Valley-based developer of carrier-class access platforms, has entered the rapidly growing multi-services access market.

The company will deliver an ultra-high density, high value Universal Access Platform (UAP) to seamlessly bridge circuit-switched and packet-switched public network infrastructures. ANDA's solution, the UAP 2000(TM), will enable carrier-controlled migration from TDM-centric infrastructures to high bandwidth access technologies such as ATM and SONET. Starting immediately with its first products, ANDA plans to give carriers at least 9x cost savings over existing central office access solutions.

Business Summary

ANDA Networks was founded in February 1998 by network technology entrepreneur Wu-Fu Chen, co-founder of Cascade Communications, as well as Edward Ip, Dr. Raymond Jamp, Tony Chern, George Chen and Mark Reichenbach, who came to ANDA from BNR/ Nortel, Hewlett Packard Labs, Ericsson and Alcatel. Charles R. Kenmore, president and CEO, now leads ANDA. Engineering, marketing and operations leaders bring further experience from carrier system manufacturers and service providers such as Cisco, Verilink, ADC, DSC, Ericsson, Sprint, British Telecom and Motorola. ANDA has built a team with particular expertise in product innovation, carrier switching, routing and access concentration, higher-layer telecom services, carrier network management and high-performance computing. The company's 50 developers, engineers, operations and marketing personnel staff its carrier-class programs.

ANDA's initial products target the needs of voice and data Competitive Local Access Carriers (CLECs) striving for dramatically smaller access platform footprint, rapid delivery of new technologies, and very aggressive price/performance. The company will expand to serve international carriers and Incumbent Local Exchange Carriers (ILECs), and plans to achieve rapid market entry through its Value-Added Reseller partnership with leading telecommunications systems provider PairGain Technologies.

Market Conditions and Needs

Financial and networking industry analysts have forecasted CLECs will shift capital spending away from basic infrastructure (e.g., fiber builds, transmission gear, voice switches) and toward equipment that directly supports subscriber line growth, i.e., access equipment at the network edge and in the central office. In addition, CLECs now aim to provide both voice and data services to their customers over the same line-side infrastructure. In light of rising pressure on CLEC budgets and demands to invest in Digital Loop Carriers (DLCs), Digital Cross Connects (DACS), more flexible Digital Subscriber Line Access Multiplexers and access concentrators, CLECs need an infrastructure that enables

1) Delivery of integrated multi-service voice and high-speed data

applications,

2) Maximum utilization of embedded equipment at significant cost

savings, and

3) Rollout of higher margin, value-added IP services like VoIP, IP

fax multimedia conferencing and unified messaging over a unified

and flattened architecture.

Finally, because CLECs face great scarcity of collocation space and technician resources for platform installation, as well as unprecedented downward pressure on pricing and time-to-market, they demand access solutions with very high port density, ease of installation/upgrade and universal service interfaces, all at carrier-grade (99.999%) reliability.

The ANDA Networks Approach

To address these market conditions, ANDA is dedicated to providing carriers with:

-- Granular scalability and high port density per access module, to

yield higher utilization of installed equipment;

-- Network streamlining and simplification, to yield reductions in

network operating costs;

-- Flexible, future-proofed network architectures, to support rapid

delivery of new, higher-margin network services;

-- Customer-controlled migration to new access technologies, without

forklift upgrades in the network;

-- Ease of adoption for new but proven technologies in the central

office environment.

The Universal Access Platform 2000 is ANDA's flagship platform. Future feature releases are designed to enrich the choices carriers have for deploying their access networks, and to bridge the delivery of business telephony and IP connectivity on a single unified platform. Initially the UAP serves as a powerful front-end GR-303 gateway to Lucent 5ESS and Nortel DMS100 central office switches, and dramatically improves CO switch port utilization with no quality degradation in traffic delivery. Through multiple releases in the next nine months, ANDA will combine GR-303 voice concentration between line-side DS-0's and T1s into Class 5 switches with high-density T1, HDSL, and HDSL2 ports, as well as integral framing, frame relay and ATM access, grooming and concentration; integral SONET and 2-wire analog telephone interfaces; and open-standards interoperability with other access devices.

Operationally, ANDA has a carrier-class delivery model capable of scaling to meet strong demand and high performance standards from CLECs market-wide. ANDA's experienced program management team has met these requirements in the past through worldwide implementation of advanced broadband access products, and is coordinating product delivery and customer support with ANDA's VAR channel partner, PairGain Technologies. ANDA's teams have rapidly developed standards-compliant architectures (e.g., NEBS 3), which have successfully passed interoperability testing with Lucent and Nortel central office switches in external evaluation labs.

ANDA has completed alpha tests of the UAP 2000 in Bell South's Birmingham interoperability lab. Initial shipments to revenue-generating customers are scheduled for mid-May.

Funding History

Lead investors include Wu-Fu Chen for Series A, Venrock Associates and InveStar for Series B, Highland Capital Partners, and PairGain Technologies and Crimson Capital for Series C, which closed in March 1999. Both Venrock and InveStar have made additional investments in Series C. Total capitalization for ANDA Networks now stands at $26.6M.

ANDA Networks is headquartered in Santa Clara, CA.