Alcatel Allies with Stanford Telecom to Provide Wideband Wireless Access Solutions.

NANTERRE, France--(BUSINESS WIRE)--July 29, 1997--Two world-wide technology leaders, Alcatel and Stanford Telecommunications Inc., have agreed to jointly develop and market a system which applies wideband technologies to radio access solutions.

Destined for operators of multi-service networks in densely-populated locations, the Alcatel 9900 WW product family will open up new horizons for radio on the world-wide telecommunications market.

The point-to-multipoint radio technology will be used in small and medium-sized enterprises networks and in mobile networks providing a more economical transmission means than point-to-point connections in densely-populated areas. The system incorporates a central station and up to several hundred terminal stations: these in turn are connected to one or more networks -- usually a voice network and a broadband data network.

"This agreement unites two radio communications heavyweights in a cooperative development effort. The fruit of the partnership will be a point-to-multipoint system providing clear operator and end-user benefits," said Jerome de Vitry, vice president for Radiocommunications, Alcatel Radio, Space and Defense Division. "Wideband radio technology offers distinct advantages for providing cost-efficient solutions for local loop, access and corporate networking in densely-populated areas."

"The Stanford Telecom team is very excited about the prospects of working with the world leader in microwave radio products in developing this innovative and cost effective wideband communication system," said Val Peline, president and CEO of Stanford Telecom.

"Alcatel and Stanford Telecom are uniquely positioned to successfully complete this development and offer an innovative addition to Alcatel's product family. We believe this system will offer customers an elegant solution to their expanding communication needs," said George Hendry, vice president for Stanford Telecom's Wireless Broadband Products organization.

The Alcatel 9900 WW system targets two major applications:

-- Services for corporate customers. The system is especially useful in providing service to small and medium-sized enterprises (SME) having a few dozen people at their facility. Such sites are typically equipped with a limited number of telephone lines and require data transmission capability (Internet, Intranet and links between the local networks of different companies). This is a fast-growing market segment which requires wideband functionality. Studies indicate that, for SME's, data transmission should take precedence over voice communications in telecommunications traffic in years to come. Currently the ratio stands at 80 % voice communications and 20% data transmission and this is expected to move to 40/60%.

-- Access networks and mobile networks. A wideband radio access system enables an operator to optimize the interconnections of a large number of sites in a small geographical area. This is for example an ideal solution to interconnect base stations in a wireless local loop network. It thus complement the Alcatel 900/1800 (mobile network infrastructure systems for GSM, CDMA and TDMA standards) and the Alcatel 9500 (DECT) product ranges.

SME's rely on third party carriers for both voice and data services. Therefore, the Alcatel 9900 WW will be marketed to public and private carriers operating fixed and/or mobile networks. Specifically, new carriers entering markets dominated by established public operators will find the Alcatel/Stanford Telecom solution the best adapted to their needs.

"A new carrier needs a solution which enables him to gain a foothold in the market in the shortest time, while keeping his initial financial outlay to a minimum. The carrier needs a product which is quick to install and costs much less than cable systems. Ideally the system should be able to evolve, enabling him to invest in a way that ensures his network equipment is always closely matched to growing demand. The Alcatel 9900 WW meet all of these requirements," said de Vitry.

Alcatel will market the Alcatel 9900 WW in the developed world and those countries which are enjoying strong economic growth rates. It is well-suited to the deregulated European market, effective at the start of 1998. The wideband system will also be marketed in North America, where frequency bands have been reserved for such applications, as well as in Latin America and Asia. In order to meet the ANSI standard in the United States, as well as the ETSI standard for the rest of the world, development is being carried out in Alcatel facilities in both Europe and the United States.

The Alcatel 9900 WW will enable customers to optimize use of radio resources by using packet transmission. This makes it possible to handle large volumes of traffic over a short time period, thereby avoiding the need for costly permanent high data-rate capacity.

This wideband radio access system complements other Alcatel products. Alcatel has a range of hi-speed access products based on three different technologies: ADSL (Asymmetric Digital Subscriber Line) which enables unconstrained multi-megabit per second transport of video, audio and data information over the existing copper telephone access network, FITL (Fiber-In-The-Loop) for passive optical networks and HFC (Hybrid Fiber Coax) for cable TV networks. Alcatel also offers a complete range of broadband switching and access products. -0-

Notes to Editors: Alcatel microwave radios and satellite transmission systems are developed and manufactured by the Alcatel Radio, Space & Defense Division, with headquarters in Nanterre (near Paris), France. Alcatel is developing and manufacturing microwave radios in France, Italy and the United States.

Alcatel is the world's leading supplier of microwave systems, with a 20% share of the total worldwide market. The company's installed base - more than 200,000 transceivers in 140 countries -- is likewise the world's largest. Alcatel, which has been supplying wireless links for more than 60 years, offers the world's most comprehensive range of microwave radio products and systems. These cover every authorized frequency band, from 330 MHz up to 38 GHz for both ETSI and ANSI standards. They also cover virtually every data rate, from 256 kbit/s to 155 Mbit/s.

Alcatel is also a world class player in satellite earth stations and gateways, with over 30 years experience. The company is a major supplier of satellite transmission systems for public and private networks as well as a leading player in emerging space systems. Alcatel is providing key space and terrestrial elements for Globalstar, an array of 48 LEO satellites to provide global mobile telecommunications services, MTSAT, a Japanese air navigation system, and WorldStar, a three-satellite digital radio broadcasting system. Recently, Alcatel was selected to supply the ground segment of M2A, the world's most ambitious space access system for fixed subscribers. The company is also participating in the design and production of the M2A satellite payload.

Stanford Telecom (Nasdaq/NMS:STII) has over 20 years of extensive research and development in the field of digital telecommunications technologies. It has over 60 patents granted or applied for in communications technologies. It designs, manufactures and markets advanced digital communications products and systems to establish or enhance communications via satellites, terrestrial wireless and cable. The company also provides communications systems networking solutions and Global Positioning System (GPS) navigation products. Stanford Telecom's expertise encompasses all the technologies required for these systems, including radio frequency, digital, ASIC's, software, and system design.

CONTACT: Alcatel

Christophe Lachnitt, 33 (0)1 46 52 33 92

Fax: [phone]

E-mail: [e-mail]

or

Stanford Telecom

Gary Wolf, 408/745-2403

Fax: [phone]

E-mail: [e-mail]