Bay Networks Announces Optivity Service Level Management; Providing Comprehensive Network and Application Management System for Delivering Application-Optimized Networks.

SANTA CLARA, Calif.--(BUSINESS WIRE)--Aug. 26, 1998--Delivering on its vision of providing application-optimized network management solutions, Bay Networks(R), Inc. (NYSE:BAY) today announced the release of Optivity(R) Service Level Management.

The latest addition to the Optivity network management solution consists of two products for managing end-to-end application service levels on the network. Optivity Service Level Analysis and Optivity Service Level Help enable network managers to optimize their networks for business-critical applications by measuring and reporting application service-levels on a per application or per user basis. The integrated solution of on-going service level monitoring and real-time performance analysis simplifies application service level performance problem diagnosis and shortens time to resolution, reducing network downtime and total cost of ownership.

"With the introduction of Optivity Service Level Management, Bay is delivering the first product proof point in its application-optimized network management strategy," said Clive Foreman, vice president and general manager of the Network Management Division at Bay Networks. "The Optivity Service Level Management solution provides our customers with a unique solution for managing end-to-end business-critical application service-levels across multi-vendor networks."

The prime focus of Bay Networks network management strategy is to link service-level management to the underlying network infrastructure. This allows network managers to quickly identify application performance problems, and use the Optivity Network Management System to modify the underlying hardware infrastructure to meet ongoing service level agreements. This unique solution of combining top-down performance monitoring along with bottom-up network management tools enable network managers to be more effective at meeting customer expectations, supporting new services, and managing the growth of bandwidth intensive network applications. This provides network managers with an understanding of the impact of business-critical information flows allows them to more efficiently provision network resources while obtaining detailed accounts of actual usage and service levels.

As Bay Networks continues to deliver the components of its application-optimized network management strategy, network and IT managers will be able to employ Optivity Policy Services (see announcement dated 8/17/98) to establish the intended end-to-end Quality of Service per application across the network. Customers can then use Optivity Service Level Management to ensure the business-committed application service level is actually being delivered.

"With this policy-based, multi-vendor service management solution, the Optivity network management solution will lead the industry in the new network management paradigm essential for managing today's business-critical IP network," said Mark de la Vega, director of product management, for Bay Networks' Network Management Division.

"Without question, effective Service Level Management is becoming an increasing priority for many network managers," said John Morency, vice president, Network Solutions, Renaissance Worldwide, Inc. "Key to successful SLM implementation, however, is ensuring that effective service delivery from the end user point of view is achieved. The functionality supported by Optivity Service Level Management is strongly differentiated by its ability to monitor service level delivery from the end station perspective far more effectively than its competition."

About Optivity Service Level Analysis

Optivity Service Level Analysis (SLA), a component of Bay Networks' Optivity Service Level Management solution, is the industry's first comprehensive network management application that provides complete visibility of application performance all the way to the end-users' desktop.

Whether users are accessing email or using business-critical applications such as, SAP, BAAN, or People Soft, Optivity Service Level Analysis monitors user transaction over the network and reports end-to-end networked application performance from a user perspective. Integrating this application performance information with the vast knowledge of the network infrastructure contained within the Optivity Network Management System allows network managers to effectively establish or maintain application service levels.

About Optivity Service Level Help

Optivity Service Level Help (SLH) is the diagnostic counterpart to the Optivity Service Level Analysis application service monitoring solution. It is a front-line diagnostic tool designed to make network managers more effective at trouble shooting and correcting application service level performance problems.

Optivity Service Level Help quickly focuses on performance deficiencies and allows the network manager to determine whether a performance problem is related to the network, client, server, or application. Used in conjunction with Optivity Network Management System, the industry's leading network management solution, Optivity Service Level Help provides vital information about application performance problems that can be quickly converted into information about the health of the supporting network infrastructure.

Pricing and Availability

The Optivity Service Level Management solution is available today and is priced as follows: -0-

-    Optivity Service Level Management solution (includes both
     Optivity Service Level Health and Optivity Service Level Help),
     100 Nodes, list priced at $26,495

-    Optivity Service Level Analysis, 100 Nodes, list priced at
     $13,495

-    Optivity Service Level Help, 100 Nodes, list priced at $15,995

-0- Support for additional nodes can be added to all products.

About Bay Networks -- Where Information Flows(tm)

Bay Networks, Inc. (NYSE:BAY) is a leader in the worldwide networking market, providing a complete line of products that serve corporate enterprises, service providers and telecommunications carriers. The company offers frame and ATM switches, routers, shared media, remote and Internet access solutions, IP services and network management applications, all integrated by Bay Networks' Adaptive Networking strategy. With headquarters in Santa Clara, Calif., Bay Networks markets its products and services around the world, providing 7x24 support coverage. For additional information visit the company's World Wide Web site at http://www.baynetworks.com or call 800-8-BAYNET.

This release, other than historical financial information, contains forward-looking statements that involve risks and uncertainties. These statements may differ materially from actual future events or results. For instance, factors which could cause results to differ from future events include the timing of customer orders, the rate of adoption of new technologies in the data networking market, and competitive pricing actions, among others. Readers are referred to the documents filed by Bay Networks with the S.E.C., specifically the most recent reports on forms 10-K and 10-Q, which identify important risk factors which could cause actual results to differ from those contained in the forward-looking statements.

Note to Editors: Bay Networks and Optivity are registered trademarks of Bay Networks and Bay Networks - Where Information Flows is a trademark of Bay Networks, Inc. Other brand and product names are registered trademarks or trademarks of their respective holders.

CONTACT: Bay Networks, Inc.

Neha Mirchandani, 408/495-2489

[e-mail]

Ellen Roeckl, 408/495-3083

[e-mail]