Chinook Communications Receives $17 Million in Financing to Launch Bandwidth Creation Company.

Business Editors/Hi-Tech Writers

LEXINGTON, Mass.--(BUSINESS WIRE)--April 2, 2001

Startup Company Solving Last-Mile Congestion Problem to Enable

Revenue-Generating Services for Broadband Operators

Chinook Communications, Inc. today announced the completion of a $17 million round of financing by top-tier investors.

Chinook is an emerging, rapidly growing high-technology startup bringing broadband industry veterans and entrepreneurs together with key scientists in communications systems research from the Massachusetts Institute of Technology (MIT).

The company is commercializing spectrum enhancement technology originally developed in the labs at MIT that gives broadband operators additional digital bandwidth to support advanced services. Potential new services include Video-On-Demand, high-speed tiered data services, and more TV channels. Chinook's solutions will allow broadband operators to reap more revenues from existing cable, terrestrial broadcasting, and satellite infrastructure without the need for costly plant upgrades.

Broadband operators will then be able to provide additional video, voice and data services concurrently without interference to existing services. Chinook is a well-funded early stage company backed by top-tier venture capital firms experienced in fueling the growth of innovative technology companies.

The company is privately held and is led by a proven management team of cable and networking executives (see related press release). Chinook has received approximately $17 million of financing led by the following investors: OneLiberty Ventures, WaldenVC, BancBoston Ventures, Highland Capital Partners, and YankeeTek Ventures.

Andrew J. Audet, President and CEO of Chinook, said, "We are pleased to announce financing by such prestigious investors. Chinook will create tremendous value as the company helps broadband operators create new sources of revenue. With minimal incremental investments in network infrastructure, broadband operators will be able to create additional revenue-generating digital bandwidth. They can deploy enhanced services that bind subscribers to the network, delay or postpone major upgrades in network infrastructure, and swiftly increase revenue-per-subscriber ratios."

New Company Capitalizing on Broadband Market Opportunities

Industry analysts estimate the broadband access market to grow to between $10 and $14 billion by 2005 as operators expand market share and increasingly deliver new services over broadband networks. Kinetic Strategies forecasts that cable operators in North America alone are installing 8,500 new cable modem subscribers per-day--more than double the number of just a year ago.

In addition, Paul Kagan Associates forecasts that over 20 million set-top boxes and 15 million cable modems will be installed worldwide over the next three years. Broadband satellite and fixed wireless services also continue to grow aggressively as both corporate and residential subscribers demand more bandwidth and additional services, and demand for terrestrial datacasting continues to increase as subscribers demand enhanced content.

Broadband operators are already experiencing infrastructure bottlenecks and are having to strategically allocate investment capital to maximize market share, revenue, and profits. Cost-effective solutions from Chinook will allow these broadband operators to extend current-generation infrastructure to create additional bandwidth--and additional revenue--from broadband access networks. Operators can therefore increase billable capacity with minimal investments, thereby increasing profits and extending the useful life of existing investments in plant and infrastructure.

About Chinook Communications

Chinook Communications, Inc. is developing and commercializing a new generation of spectrum enhancement technology initially developed in the labs at MIT. This technology will allow operators to create additional digital bandwidth and extend the life of existing infrastructure. Chinook's solutions add up to 6 Mbps of bandwidth to each channel without impacting existing services.

This gives broadband operators the ability to mass deploy revenue-generating services such as Video-On-Demand, high-speed tiered data services, and additional TV channels. Chinook has received $17 million in venture financing from OneLiberty Ventures, WaldenVC, BancBoston Ventures, Highland Capital Partners, and YankeeTek Ventures. The company is developing next-generation broadband solutions using this newly developed and patented communications technology for ultra-efficient spectrum utilization. For more information about Chinook, please visit www.chinook.com.