CallWave's Internet Answering Machine Leads Hot New Internet Phone Services Market.

Business Editors

SANTA BARBARA, Calif.--(BUSINESS WIRE)--May 15, 2000

Saddletree Research Claims Internet Call Answering Will Reach Nine

Million Households This Year, Up From 1 Million Last Year

In a recently released report by Saddletree Research, CallWave's Internet Answering Machine was named the leader among all Internet Call Answering services, which provide low cost or free alternatives to second phone lines.

With approximately 55% of the market, CallWave has more customers than all other providers combined. In addition, Saddletree said that voice Application Service Providers (ASPs) such as CallWave, are poised to lead the emerging Internet Phone Services market.

CallWave's free Internet Answering Machine (IAM) enables Internet users to hear who's calling while they're online. IAM also eliminates annoying busy signals for callers trying to reach someone who is online. Instead of getting a busy signal, callers can leave a voice message that the online user hears instantly over the speakers on their PC. The Internet Answering Machine occupies a small window on the user's computer screen while they are online and displays incoming calls, plays messages, and saves them for replaying later.

According to Paul Stockford, chief analyst at Saddletree Research, "Out of the 54 million U.S. homes with personal computers, more than nine million of these will be using Internet Call Answering software by the end of this year." Saddletree also predicts that this market will grow at over 38% annually through the year 2004.

"Our market share is attributed to the ease of use of the Internet Answering Machine, and its appeal to the consumer's pocketbook," said David Hofstatter, president of CallWave. "We've captured millions of users by giving them a compelling free alternative to their local phone company. We are delivering innovative Voice over IP (VoIP) alternatives to expensive second phone lines."

PC Data Online reports that CallWave's Web site was the 143rd most visited site on the Internet for March 2000. CallWave's Web traffic ranks ahead of such popular consumer sites as E-Trade, Buy.com, Quicken, and CompuServe.

Other Awards and Recognition for CallWave's Internet Answering Machine

-- PC World's April 2000 Issue named IAM one of the best Web

bargains in its 5th Annual Best Free Stuff Online.

-- IAM rated exceptional by three major players in the download

market, achieving ZDNet Editor's Pick & 5 Star rating (out of 5),

Tucows's 4 Cows (out of 5), and Jumbo's 9 Stars (out of 10).

-- IAM took 50 Best Products of 1999 and 50 Best Websites of 1999

from Computer Journal.

-- IAM has consistently been a Top 5 Download on TechWeb, the

premier site for IT professionals.

-- AOL featured IAM as its Site of the Week.

-- The Los Angeles Business Journal named IAM its Site of the

Week.

More about Internet Answering Machine

The Internet Answering Machine is free and available throughout the U.S. and is compatible with all browsers and Internet Service providers, including AOL. Internet Answering Machine works with the Busy Call Forwarding feature of the user's phone line. The free IAM software can be downloaded in less than a minute at http://www.callwave.com and runs on Windows PCs.

About CallWave(TM)

CallWave is a new type of Internet-based telephone company with corporate offices in Santa Barbara. CallWave's mission is to give Internet users the convenience and functionality of extra phone lines in their home or small office, without having to install or pay for additional lines from the phone company. CallWave's Internet Answering Machine is a free alternative to a dedicated modem line, and the FaxWave fax-to-email service is a free alternative to a dedicated fax line. Both services are available to Internet users nationwide, and use open file formats, enabling voice and fax messages to be reviewed on and forwarded to almost any computer.

Media inquires should be directed to Bruce Thompson at [e-mail] or by telephone to 805/690-4115. CallWave, Internet Answering Machine and FaxWave are service marks of CallWave Inc. All other trademarks are the property of their respective owners. To subscribe or for more information, visit http://www.callwave.com.

About Saddletree Research

For more information about Saddletree Research contact Paul Stockford at [e-mail] or by telephone at 480/922-5949. Web site can be found at http://www.saddletreeresearch.com.