Blue Wave Systems FACT Real Time Targets Embedded Applications.

Business Editors & High-Tech Writers

CARROLLTON, Texas--(BUSINESS WIRE)--Oct. 4, 2000

New ComStruct Building Block Improves Competitive Advantage by

Enabling Developers to Focus On Service Innovation

Blue Wave Systems Inc. (NASDAQ:BWSI), a leading supplier of processing technology for the telecom infrastructure, has extended its ComStruct(TM) range of communications processing building blocks with the launch of FACT(TM) Real Time (FACT-RT). This new version of Blue Wave's powerful subsystem development and management solution is optimized to enable communications equipment manufacturers to quickly develop very high-density embedded applications where channel count and speed of operation are critical, such as wireless transcoding, voice archival and fax services. By using this new FACT technology, Blue Wave's customers can devote more project time to developing innovative service offerings, which is a crucial differentiator in the competitive telecommunications market.

FACT-RT provides an integrated solution for the rapid development and management of ComStruct-based communications subsystems, enabling developers to harness the power of Digital Signal Processor (DSP) resources without the need for complex DSP programming. High-level APIs enable the system to establish, route and process multiple calls between end points, such as line interfaces, and the on-board DSPs. Integrated resources within FACT-RT - including ITU standard vocoders, wireless vocoders, and fax, modem, tone and echo cancellation functionality - underline the time-to-market and lower risk advantages that are a feature of Blue Wave's ComStruct line. FACT-RT will be available at the end of calendar Q4 2000.

Karl Wale, product manager for Blue Wave Systems said: "The individuality of service offerings is a key differentiator in the highly competitive telecommunications market. To succeed equipment providers must devote more time to innovating, and spend less time on low level technical issues. FACT releases this valuable development time and enables this innovation by providing all the underlying technology, software and algorithms. FACT-RT brings this competitive advantage to the real-time embedded applications market."

Typical applications where FACT-RT can provide a rapid development solution include:

-- Wireless Local Loop - voice and data coding/compression in the base station
prior to transmission over the air interface

-- Voice archiving - repetitive recording and playback of data from disks

-- Fax services such as faxback, where the application must accept a call to a
particular number and fax a document back to the originating number

FACT-RT will initially run under WindRiver's VxWorks(R) and Blue Wave plans to add support for other operating systems with future releases of the product.

Blue Wave Systems' ComStruct is a set of modular and scalable communications processing building blocks that includes hardware, software and DSP resources. ComStruct enables telecom infrastructure equipment manufacturers to develop, test and deploy carrier-class wireless and wireline technology for applications ranging from 3G wireless to Voice over IP. At the heart of ComStruct is the FACT(TM) application development and subsystem management solution that enables customers to easily incorporate commercially available or proprietary algorithms for the rapid development and full deployment of high-density telecom applications. For more information on Blue Wave's ComStruct solutions visit http://www.bluews.com.

Blue Wave Systems is a leading supplier of high-channel Digital Signal Processing (DSP) subsystems used in telecommunication infrastructure equipment, such as voice over packet (VoIP) gateways, digital wireless communications and intelligent peripherals. The ComStruct(TM) line of telecom infrastructure communication processing subsystems was launched in January 1999. At the heart of the ComStruct(TM) line is the company's FACT(TM) software (Framework Architecture for Communication Technologies), which enables the DSP subsystem to be rapidly and effectively deployed in a variety of carrier class telecom applications. Blue Wave Systems has been a market leader in DSP board-level products since 1983. For additional information, please visit our company's web site at www.bluews.com.

ComStruct and FACT are trademarks of Blue Wave Systems Inc. All trademarks are acknowledged.

This press release contains forward-looking statements which are based on expectations of the Company but involve a number of risks and uncertainties, including, but not limited to, technological change, quarterly fluctuations, integration of Mizar and Loughborough Sound Images, dependence on the defense industry, dependence on key suppliers and employees, competition, and Year 2000 compliance. The foregoing list should not be construed as exhaustive and the Company disclaims any obligation subsequently to revise forward-looking statements to reflect unanticipated events. For a further explanation of risk factors please see the Company's most recent SEC filings. The Company further cautions users who may utilize published bookings and backlog information as tools to forecast the company's revenue during a given timeframe since certain purchase orders may be subject to 1) cancellation and, 2) revision to delivery schedules.