Avistar Communications Reports Financial Results for the First Quarter of 2007.

SAN MATEO, Calif. -- Avistar Communications Corporation (NASDAQ:AVSR), a video collaboration platform provider, today announced its financial results for the three months ended March 31, 2007.

Revenue for the three months ended March 31, 2007 was $2.4 million, compared to revenue of $2.3 million for the three months ended December 31, 2006 and $1.9 million for the three months ended March 31, 2006. Income from settlement and patent licensing was $13.1 million for the three month period ended March 31, 2007. For each of the three month periods ended December 31, 2006 and March 31, 2006, income from settlement and patent licensing was $1.1 million. The increase in income from settlement and patent licensing during the first quarter of 2007 was due to proceeds of $12.0 million from the settlement of litigation brought by Avistar and its wholly-owned subsidiary, Collaboration Properties, Inc., against Tandberg ASA and its subsidiaries.

Avistar reported a net income of $4.5 million, or $0.13 per basic and diluted share, for the three months ended March 31, 2007. Avistar reported a net loss of $3.2 million, or $0.09 per basic and diluted share, for the three months ended December 31, 2006, and a net loss of $3.1 million, or $0.09 per basic and diluted share, for the three months ended March 31, 2006. The net income for the first quarter of 2007 reflects, among other things, the proceeds of the Tandberg settlement and associated patent licensing. Net income for the three months ended March 31, 2007 included $0.7 million of employee stock compensation expense, while net loss for each of the three month periods ended December 31, 2006 and March 31, 2006 included $0.5 million of stock compensation expense.

As of March 31, 2007, Avistar had cash and cash equivalents of $12.3 million.

"The conclusion of our patent litigation against Tandberg ASA and subsidiaries was an extremely positive development during the first quarter of 2007," stated Gerald J. Burnett, Chairman and Chief Executive Officer of Avistar. "With Tandberg now licensing our patent portfolio, we have all of the largest traditional video conferencing companies under license. The payment that we received during February helped us generate a quarterly profit, and we expect that this will help us toward our goal of achieving a profit for the 2007 fiscal year. When Avistar management evaluates our business progress, we consider the sum of reported revenue and income from settlement and licensing activities, the latter of which records proceeds from licenses entered into following the start of litigation. This sum for the first quarter of 2007 was over 85% of the corresponding total for 2006 as a whole."

Dr. Burnett continued, "On April 17, 2007, we received our seventy-sixth patent. This most recent award from the U.S. Patent Office relates to instant messaging, as did a prior patent which we received on December 19, 2006. We anticipate that this ongoing expansion of our intellectual property portfolio into complementary collaboration technologies will simultaneously support our product offerings and our partnering and licensing efforts."

About Avistar Communications Corporation

Avistar Communications Corporation develops, markets, and supports a video collaboration platform for the enterprise, all powered by the AvistarVOS[TM] software. From the desktop, Avistar delivers business-quality video calling, recording, publishing to web and e-mails, video-on-demand, broadcast origination and distribution, and document sharing. Avistar video-enables business processes by integrating visual communications into the daily workflow and connecting communities of users within and across enterprises. Founded in 1993, Avistar is headquartered in San Mateo, California, with offices in New York and London. Avistar's technology is used in more than 40 countries.

Collaboration Properties, Inc. (CPI), a wholly owned subsidiary of Avistar Communications Corporation, was founded in 1997. CPI develops patents for presence-based interactions, wireless communications, desktop video, recorded and live media at the desktop, multimedia documents, data sharing, and a service-rich video network architecture. It holds a current portfolio of 76 patents for inventions in the primary areas of video and network technology. CPI offers licenses to its patent portfolio and Avistar's video-enabling technologies to companies in the video conferencing, rich-media services, public networking, and related industries. Current licensees include Sony Corporation, Polycom, Inc., Emblaze-VCON and Tandberg ASA.

For more information, visit www.avistar.com.

Forward Looking Statements

Statements made in this news release that are not purely historical, including but not limited to statements regarding Avistar's goal of achieving a profit for its 2007 fiscal year, the ongoing expansion of Avistar's intellectual property portfolio, and the benefits of such expansion, are forward-looking statements within the meaning of Section 21E of the Securities Exchange Act. Such statements are subject to risks and uncertainties that could cause actual results to differ materially, including such factors, among others, as challenges associated with protecting Avistar's intellectual property, the lengthy sales cycles and volatility associated with Avistar's sales and licensing activities, market acceptance of Avistar's products, and increased competition in the market for video collaboration products. As a result of these and other factors, Avistar expects to experience significant fluctuations in revenue and operating results, and there can be no assurance that Avistar will become or remain profitable in the future, or that its future results will meet expectations. These and other risk factors are discussed in Avistar's Annual Report on Form 10-K and Quarterly Reports on Form 10-Q filed with the Securities and Exchange Commission from time to time. Avistar disclaims any intent or obligation to update these forward-looking statements.

Copyright [c] 2007 Avistar Communications Corporation. All rights reserved. Avistar, AvistarVOS, and the Avistar logo are trademarks or registered trademarks of Avistar Communications Corporation.

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