Alvarion Receives Order from Telekom Serbia for First Phase of Major Access Infrastructure Project; Equipment Valued At $3.6M for Voice and Data Services to Suburban and Rural Areas.

TEL-AVIV, Israel -- Alvarion Ltd. (NASDAQ: ALVR), the leading provider of wireless broadband solutions worldwide, today announced that Serbia's incumbent operator, Telekom Serbia A.D., has placed an initial $3.6M order for its advanced eMGW(TM) solutions to support voice and data services. Installation of equipment has already begun in Parnicko Brdo (Novi Pazar). This order is the first to be received under a previously announced frame agreement with Telekom Serbia which will use Alvarion field-proven solutions to establish its telecommunications infrastructure to suburban and rural areas of the country.

The network will be designed and built using Alvarion's technology. Design, and whole engineering will be done by the Ei COMgroup KONSING d.o.o. Alvarion's regional distributor, TeleGroup d.o.o., will be responsible for logistics of the import of equipment, project and installation of the customer premises equipment.

"Both fast Internet access and carrier class voice services have become basic requirements for commerce and education in Serbia and broadband wireless is the most cost-effective way to provide connections to many of our residence and business users," said Drasko Petrovic, Director General of Telekom Serbia. "The extensive experience of Alvarion, Ei COMgroup KONSING and TeleGroup with deployments of this size gives us confidence as we embark on this significant project to use eMGW(TM) to bring service to new regions."

The eMGW solution, operating on 3.5 GHz, will provide voice and fast Internet services for homes and small businesses in a number of Serbia's southern regions, including Novi Pazar and Nova Varos. The eMGW system provides cost-effective infrastructure solutions especially in this mountainous region with low-density population and rough terrain. The fast and easy installation of the system enables the operator to quickly provide services in the underserved areas.

"Telekom Serbia's ambitious infrastructure project focuses on using broadband wireless as the best way to fill service and infrastructure gaps in their network, and with the industry's most extensive deployment experience, we are well prepared to supply and support them in this multi-phase, region-wide project," said Zvi Slonimsky, CEO of Alvarion. "Overall, the increase in demand for broadband connectivity continues to drive operators world-wide to use wireless access solutions as a cost effective, quick to install way to provide connection to users in areas where the existing infrastructure can not address the need for broadband."

Telekom Srbija a.d. is the national telecommunications service provider of the Republic of Serbia. Established in 1997, it is owned jointly by Serbia's Postal Authority (PTT Serbia) (80%) and OTE, the Greek full-service telecommunications provider (20%). It provides the full range of telecommunications services, including fixed and mobile voice, data communications and Internet access, to more than 2.4 million subscribers. Its networks cover 92% of Serbia's population and 66% of its geographic area. Telecom Serbia continues to invest heavily to extend its infrastructure and services offering throughout Serbia, and to continually improve the quality of existing services. For more information, please refer to: www.telekom.yu

Ei COMgroup KONSING is one of the Balkan Region's leading telecommunications engineering, integration and consulting groups. It was formed in January 2002 as a joint venture between Ei Corporation (30%), one of the leading Yugoslav electronic and telecom companies, and COMgroup International (CGI) (70%), a leading US telecommunications consulting group. Konsing's expertise covers the full range of advanced telecommunications technologies, including Mobile Telephony (GSM-900/ 1800/ 2G, 3G), Broadband Wireless Access (BWA/ FWA/ WLL), Transmission Systems (SDH/ PDH/ RR), IP/ IT Multimedia Networks, and Protection, Control and Monitoring Systems. For more information, please refer to: www.konsing.com

TeleGroup d.o.o. Belgrade was founded in 2001 as a daughter company of TELEGROUP LIMITED, the London-based telecom services provider. TELEGROUP provides complete, tailored network infrastructure systems to premier customers throughout the Balkan region. Its complete business communication systems integrate voice and data transmission, internet traffic and multimedia services. TeleGroup is skilled in carrying out large projects requiring sophisticated logistics, including extensive installation and maintenance activities. For more information, please refer to: www.telegroup-ltd.com

About Alvarion

With more than 2 million units deployed in 130 countries, Alvarion is the worldwide leader in wireless broadband providing systems to carriers, ISPs and private network operators. Leading the WiMAX revolution, Alvarion has the most extensive deployments and proven product portfolio in the industry covering the full range of frequency bands. Alvarion's products enable the delivery of business and residential broadband access, corporate VPNs, toll quality telephony, mobile base station feeding, Hotspot coverage extension, community interconnection, and public safety communications. Alvarion works with several top OEM providers and over 200 local partners to support its diverse global customer base in solving their last-mile challenges.

As a wireless broadband pioneer, Alvarion has been driving and delivering innovations for over 10 years from core technology developments to creating and promoting industry standards. Leveraging its key roles in the IEEE and HiperMAN standards committees and experience deploying OFDM-based systems, the company's prominent work in the WiMAX Forum(TM) is focused on increasing widespread adoption of standards-based products in the wireless broadband market.

For more information, visit Alvarion's World Wide Web site at www.alvarion.com

This press release contains forward -looking statements within the meaning of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. These statements are based on the current expectations or beliefs of Alvarion's management and are subject to a number of factors and uncertainties that could cause actual results to differ materially from those described in the forward -looking statements. The following factors, among others, could cause actual results to differ materially from those described in the forward-looking statements: inability to further identify, develop and achieve success for new products, services and technologies; increased competition and its effect on pricing, spending, third-party relationships and revenues; as well as the in ability to establish and maintain relationships with commerce, advertising, marketing, and technology providers and other risks detailed from time to time in filings with the Securities and Exchange Commission.

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