Cisco Systems Halves the Cost of Internet and Intranet Access; Acquires IDSL, SDSL Solutions to Ease Telephone Network Congestion and Increase Revenue for Carriers.

SAN JOSE, Calif.--(BUSINESS WIRE)--March 26, 1997--Cisco Systems, Inc. today entered the Digital Subscriber Line (DSL) market with delivery of the industry's most cost-effective digital access solution.

Through the acquisition of privately-held Telesend, Cisco announced a new channel unit for D4 DSL Frame Muxes, the Cisco 90i.

The Cisco 90i provides telecommunications carriers with a more cost-effective way to deliver high-speed data services for Internet and intranet access applications. The resulting service is ideal for small business users, telecommuters and residential Internet access.

The base technology for the Cisco 90i was developed by Telesend, a privately-held company specializing in wide area network access products. On March 3, 1997, Cisco acquired Telesend in a stock swap in which shares of Cisco stock were exchanged for all outstanding shares and options of Telesend. Telesend's employees and management, including President and CEO Sayuri Sharper, and the company's product line will be incorporated into Cisco's Wide Area Network business unit. Additional terms and conditions of the Telesend acquisition are not being released.

The Cisco 90i is unique in that it turns existing Time Division Multiplexing (TDM) D4 channel banks, which are deployed in nearly all 10,000 North American Central Offices (COs), into frame multiplexers. Given this approach, the Cisco 90i provides the lowest capital and operational cost solution for large scale digital access. "All xDSL solutions leverage installed copper base, but only the Cisco 90i makes use of already installed equipment," said Kieran Taylor, broadband consultant at TeleChoice, Inc., a leading telecommunications industry consulting firm. "This simple solution will enable mass IDSL deployment and could challenge dial as the access solution of choice in the next year or so."

Carrier Benefits: Lower Costs, Dial Offload, Rapid Deployment

The Cisco 90i channel unit for D4 DSL Frame Muxes is based on ISDN Digital Subscriber Line (IDSL) technology. Key carrier benefits are:

-- Lower Capital and Operational Costs: Carriers simply add the Cisco 90i channel units to existing D4 channel banks in the CO, optimizing existing spare capacity and thereby reducing equipment costs. In addition, because of the operational simplicity of the product, training and personnel costs are minimized. All management is done via a centrally located management system;

-- Dial Offload: With IDSL, carriers can offload their data traffic from their existing voice networks, thereby reducing stress on the public switched telephony networks, which were designed for short duration voice calls. In addition, carriers will now have the ability to offer users an "always connected model";

-- Rapid Deployment: IDSL uses the same loop provisioning process as basic rate ISDN and hence is ready for rapid deployment. In addition, fast time to market is achieved as carriers do not need a large number of users to justify equipping an end-office to start service because the infrastructure already exists. The Cisco 90i can operate with any frame relay backbone network;

-- Ubiquitous access: The Cisco 90i resides not only in existing D4 channel banks, but can leverage existing ISDN Basic Rate Interface (BRI) loop technology to provide access over embedded digital loop carriers to extend the service range with copper or optical fiber sections;

-- End-to-end networking compatibility: The Cisco 90i is to be included in Cisco's end-to-end architecture and management strategy to simplify provisioning and support;

-- Plug and play in the CO: Most COs in North America have D4 channel banks pre-wired, ready to turn up service. The Cisco 90i is also fully NEBS compliant.

End-User Benefits: High Speed and Uninterrupted Access, Reduced Costs

When carriers offer IDSL services over the Cisco 90i, users can achieve the following benefits:

-- High Speed Access: Users can obtain 128 Kbps today, double the speed of existing single B channel ISDN data services and many times faster than 28.8 Kbps and 56 Kbps modems;

--Uninterrupted Access: Dial-up procedures are eliminated with end users enjoying the benefits of a leased line-type of connection allowing email to be immediately received and facilitating local web hosting;

--Reduced Costs: With carriers looking to offload data from their voice networks and with the low total cost of ownership for the Cisco 90i, users can expect aggressive pricing for IDSL services.

Product Details, Availability and Pricing

The Cisco 90i has four 144 Kbps ISDN 2B1Q access loops, each supporting up to eight frame relay Permanent Virtual Circuits (PVCs) or one Point-to-Point Protocol (PPP) circuit. The Cisco 90i supports data speeds between 56 Kbps and 128 Kbps. As many as 96 IDSL ports can be supported on the D4 DSL Frame Mux with a single economic T1 frame relay uplink.

The Cisco 90i channel unit is available at a list price of $995 and is currently in trial with several carriers. A typical per port price of below $150 per port can be achieved in quantities of 10,000 ports or more. The Cisco 90i complements Cisco's existing dial offload solution, which is based on Cisco's AS5200 Universal Access Server, and a virtual dial solution using the L2F protocol. Whereas the AS5200 provides support for existing users of dial-up modems and ISDN, the Cisco 90i is targeted at users looking for higher speed or dedicated access.

These two products can be combined to form a single solution providing complete heterogeneous access capability. Cisco is also making available customer premises offerings which support IDSL. These products include the Cisco 770 SOHO router and the Cisco 1600 modular access router. Cisco's SDSL solution, the Cisco 90s, will be available in the second half of 1997.

Cisco Systems (NASDAQ: CSCO) is the worldwide leader in networking for the Internet. News and information are available at http://www.cisco.com . -0-

Note to Editors: Cisco IOS, CiscoFusion and Cisco Systems are trademarks, and Cisco and the Cisco Systems logo are registered trademarks of Cisco Systems, Inc. All other trademarks, service marks, registered trademarks or registered service marks mentioned in this document are the property of their respective owners.

This release may consist of forward-looking statements that involve risks and uncertainties. These statements may differ materially from actual future events or results. Readers are referred to the documents filed by Cisco with the S.E.C., specifically the most recent reports on Form 10-K and 10-Q, which identify important risk factors that could cause actual results to differ from those contained in the forward-looking statements.

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