Cisco Systems, Inc. Announces Agreement to Acquire Metreos and Audium; Acquisitions Signal Further Growth for the Cisco Unified Communications System.

SAN JOSE, Calif. -- Cisco Systems, Inc. (NASDAQ:CSCO) -- Cisco Systems(R) today announced a definitive agreement to acquire the privately-held companies Metreos Corp of Austin, Texas, and Audium Corp of New York, New York, in two separate deals. Both of these companies offer easy to use, drag and drop, application creation/integration environments which will strengthen Cisco's Service Oriented Network Architecture (SONA). With these acquisitions, Cisco will help enable its ecosystem of development partners to easily create and deploy value-added business applications.

In March 2006, Cisco announced its Unified Communications system, based on Cisco's SONA, which enables enterprise customers to integrate their communications systems with their IT infrastructure, thereby creating a single enterprise-wide communications platform. The Cisco Unified Communications system of voice, video and IP communications products and applications enables organizations of all sizes to communicate more effectively by leveraging all services located in the network from anywhere, with any device, at anytime.

By acquiring Metreos and Audium and their standards-based creation and integration tools, customers and partners will be able to rapidly build customized communications applications that are fully integrated across the enterprise IT infrastructure, enterprise applications, and enterprise contact centers.

Metreos is a leading provider of IP communication application development and management environments. The acquisition will help Cisco's ecosystem of third party technology partners, systems integrators, value-added resellers, and customers build and deliver applications on Cisco's Unified Communications System. Metreos' technology has proven itself in enterprise environments as a platform for integrating Cisco's Unified Communications System with enterprise business applications.

Audium is a leading provider of VoiceXML speech self-service application development and management environments. The acquisition will enable enterprises to easily build automated voice response applications that are integrated with not only their converged IP network but also work well within their Services Oriented Architecture (SOA) enabling the use of common services across the network. Leveraging the intelligence of the network, Audium's technology further strengthens Cisco's SONA and provides a platform for enterprises to integrate their business process workflow with their speech self-service applications.

"Cisco's Unified Communications system enables businesses to leverage their Cisco networks as a platform for integrating voice, video, data and mobility services," said Don Proctor, senior vice president of Cisco's Voice Technology Group. "Using common SOA standards, such as XML and VXML, these acquisitions will help our customers streamline key business processes by integrating their communications environment with their information systems."

Under the terms of these agreements, Cisco will pay approximately $28 million in cash for Metreos and $19.8 million in cash for Audium. The acquisitions are subject to various standard closing conditions, including applicable regulatory approvals, and are expected to close in the fourth quarter of Cisco's fiscal year 2006, ending July 29, 2006.

Metreos was founded in 2001 and has 19 employees in Austin, Texas. Audium was founded in 1999 and has 26 employees based in New York, New York.

Upon close of the transaction, Metreos and Audium products will be integrated into the Voice Technology Group, reporting into Proctor.

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