Cisco Takes Minority Equity Stake in Precept Software, Will Resell Precept's Multimedia Networking Products.

PALO ALTO, Calif.--(BUSINESS WIRE)--May 1, 1996--Cisco Systems and Precept Software have signed an agreement under which Cisco will make a minority equity investment in Precept and will resell Precept's standards-based multimedia networking software products.

The companies also intend to pursue additional development work to boost multimedia deployment over existing networks.

Beginning in the third quarter of 1996, Cisco will resell the Precept product family, which includes FlashWare, a client-server "middleware" product that allows video and audio to run on existing IP packet-switched networks; and IP/TV, a client-server application that multicasts live or prerecorded video and audio over IP networks.

The products are based on key industry-standard multimedia-enabling technologies, including the Real-Time Transport Protocol (RTP), a mechanism for carrying video and audio over IP networks, and the Resource Reservation Protocol (RSVP), which assigns priorities to various types of network traffic -- a critical capability in bandwidth-intensive multimedia applications such as videoconferencing. FlashWare and IP/TV are compatible with software used on the MBONE, the portion of the Internet that supports real-time multimedia.

RSVP support will also be available as part of the Cisco Internetwork Operating System (Cisco IOS(TM)) in the third quarter. Cisco IOS software ensures robust, reliable internetworks by supporting the multimedia requirements of both LAN and WAN protocols, optimizing WAN services and controlling intranetwork access. The combination of Precept FlashWare, IP/TV, Cisco's server and client software and Cisco IOS software will provide customers with a unique and compelling multimedia solution for Windows-based TCP/IP clients, without regard to the LAN technology.

In addition to the reseller arrangement and equity investment, the two companies will collaborate on developing future standards-based multicast protocols, and multicast and multimedia management tools. Multicast is a technique which conserves bandwidth by sending data simultaneously to a designated group of intended recipients rather than to all users on the network (broadcast) or serially to individual users (unicast).

Ed Kozel, Cisco's chief technical officer, said: "Cisco's strategy is to extend multimedia Internet infrastructure all the way to the desktop. Our users are looking for key multimedia standards, such as IP multicast and RSVP, which we have already implemented in our Cisco IOS software. Our agreement with Precept delivers these multimedia software features to the end user by filling in the middleware and client parts of the equation.

"As we begin to resell the Precept software in conjunction with our suite of client and network software, users can come to Cisco for simple, complete, standards-based solutions in multimedia internetworking. Cisco and Precept both are technical leaders in this area, and we greatly look forward to working together to develop products and services in this emerging market."

Judy Estrin, Precept's president and CEO, said: "Cisco has been a pioneer in introducing multimedia features into internetworking, and many of its corporate and Internet service provider customers are serious about building multimedia into their networks.

"As a startup company in an emerging market, we will gain tremendous value from this relationship, through access to a huge worldwide direct sales channel that sells to exactly the kinds of customers for which our products are best suited. The agreement also guarantees that customers can support their multimedia applications with end-node and infrastructure products that are fully compatible and optimized to work together."

Precept's FlashWare uses industry standards to transport real-time, synchronized multimedia data streams over packet-switched networks. IP/TV runs on top of FlashWare, delivering full-motion video in a PC window for such applications as corporate communications, Internet TV broadcasting, video library access, manufacturing process monitoring and surveillance systems.

Cisco Systems (NASDAQ: CSCO) is the leading global supplier of internetworking solutions for corporate intranets and the global Internet. Cisco's products, including routers, LAN and ATM switches, dial-up access servers and network management software, are integrated by the Cisco IOS software to link geographically dispersed LANs, WANs and IBM networks. Company news and product/service information are available at World Wide Web site http://www.cisco.com. Cisco is headquartered in San Jose, Calif.

Precept Software, Inc., was formed in March 1995 to develop and market standards-based networking software that addresses the emerging demand for local- and wide-area networking of real-time multimedia information. The privately held company has raised $6.4 million in two rounds of venture financing from Weiss Peck & Greer Venture Capital, Foundation Capital, Kleiner Perkins, Morgan Stanley and Sequoia Capital, and a group of private investors. Precept's World Wide Web address is http://www.precept.com.

CONTACT: Precept Software, Inc.

Judy Estrin, 415/845-5200

or

Cisco Systems, Inc.

Adam Stein, 408/526-7388

or

Ulevich & Orrange, Inc.

William Orrange or Janis Ulevich, 415/329-1590