ArelNet Announces Fax-to-Email Module for i-Tone Voice/Fax IP Gateway Solution.

YAVNE, Israel--(BUSINESS WIRE)--June 25, 1998--Arel Communications and Software Limited (NASDAQ:ARLCF, ARLWF) announced today that it's subsidiary - ArelNet Ltd., a leading provider of IP telephony solutions, today announced the general availability of its Fax-to-Email module for the ArelNet i-Tone IP gateway solution.

ArelNet's i-Tone Fax-to-Email (FTEM) module enables system users to view all their faxes using their existing e-mail application. Users are assigned a personal fax number by their i-Tone service provider and all faxes sent to this number are forwarded to the user's e-mail account. The fax image is attached to the e-mail message, enabling users to view and print their faxes, keeping the exact graphical design of the original message.

"ArelNet is committed to providing the new value-added solutions to our customers and the FTEM module is another example of this commitment," said Rachel Bennun, chief executive officer of ArelNet. "With FTEM, Carriers, ISPs and other providers of messaging services are well-positioned to offer

this additional service to their clients."

With ArelNet's i-Tone FTEM module, users can manage all of their faxes from one central location - their e-mailbox. The module does not require special training and users receive faxes to their existing e-mail client such as Microsoft Exchange or Eudora without modification to that program. Incoming faxes can be routed throughout an organization as e-mail and users of this feature can add their own message to the Fax-to-Email before forwarding it to others.

ArelNet's i-Tone FTEM module is beneficial to business travelers who access their e-mail while traveling. With this feature, they can receive their faxes without administrative intervention and without incurring long-distance phone charges when forwarding faxes to their remote location or hotel. ArelNet's i-Tone FTEM module is especially helpful to SOHO (Small-Office and Home-Office) environments where users might not have separate fax machine in place to receive fax messages. The Fax-to-Email module ensures delivery of faxes to SOHO users while maintaining the graphic integrity of the information.

ArelNet's i-Tone FTEM module also ensures confidential fax transmission of sensitive data intended for the recipient only. In a shared fax environment, it is virtually impossible to maintain a secure setting for confidential fax messages. ArelNet's i-Tone FTEM module enables users to receive important faxes and save them, electronically, for future reference.

The i-Tone FTEM module is available now for carriers, ISPs and entrepreneurs, wishing to benefit from offering new lucrative fax to e-mail services. For Pricing information and more detailed technical information, please contact [e-mail].

More About i-Tone

i-Tone is uniquely capable of combining real-time voice, real-time fax and store-&-forward fax transmissions. Unlike other solutions, which require different ports for real-time and store-&-forward, i-Tone handles both communication types on the same ports.

The i-Tone solution is a complete turnkey solution marketed to ISPs and service providers. IP networks. i-Tone supports real time phone-to-phone, fax-to-fax, PC-to-phone and other related store-&-forward services such as PC-to-fax, e-mail to fax, fax broadcasting and web fax interface.

More About ArelNet Limited

A worldwide leader in messaging and value-added services, ArelNet has messaging platforms installed in over 30 countries by major telcos, ISPs and corporation. ArelNet, Ltd. is owned by Arel Communications and Software Limited (NASDAQ/NMS:ARLCF) 64%, Northern Telecom Limited (NORTEL) 20%, and Elron Electronic Industries Limited (NASDAQ:ELRNF) 16%.

For additional information regarding ArelNet, visit their web site at http://www.arelnet.com.

More About Arel Communication and Software Limited

Arel Communications & Software Ltd., headquartered in Yavne, Israel, designs, develops, integrates and markets software for a family of products in the interactive distance learning market called IDEAL In addition, through its subsidiary ArelNet, Ltd., Arel designs, develops, markets, produces, integrates and supports, on a worldwide basis, software for two families of message-switching wide-area network systems called ARCOM and i-FAX and i-Tone. ARCOM is rated among the leading products in its field worldwide. i-FAX and i-Tone are leading solutions for IP Telephony, designed for medium to large networks. ----------

Note to editors: All product names contained herein remain the trademarks or registered trademarks of their respective owners.

    CONTACT:  ArelNet, Ltd.
               Mor Sela, 972-8-942-0880 ext. 228
               [e-mail]
               or
               The Devon Group
               Jeanne Achille, 732/671-0757
               [e-mail]