Data Connection and MetaSwitch Celebrate Quarter-Century with Near 24% Revenue Growth.

Accelerating Growth Driven by Tier 1 Carrier Deployments and Major OEM Relationships

LONDON -- Data Connection, a leading vendor of telecommunications software and hardware to original equipment manufacturer (OEM) and service provider customers, is celebrating 25 years of profitable growth with impressive annual results. Data Connection Group revenues, which include that of its MetaSwitch division, increased 24% over the previous year to a record $87M - one of the highest annual growth rates since the company was founded in 1981. Maintaining its track record of consistent profitability, the group reported earnings of $13.7M. The company's fastest-growing division, MetaSwitch, now generates 53% of revenue.

"I am immensely proud not just of what our exceptional team has achieved this year, but of our shared efforts over the last quarter of a century," said Ian Ferguson, Data Connection's founder and chairman. "Over that time, Data Connection has built a reputation for quality and innovation that is second to none - and again we see that translating into commercial success."

That commercial success - which was acknowledged earlier this year by Her Majesty Queen Elizabeth II awarding Data Connection the prestigious Queen's Award for Enterprise - can be seen across the board in every operating division.

* MetaSwitch, the next generation softswitch division, now boasts more than 300 deployments with incumbent and competitive service providers in North America, Central America and Europe. In addition to numerous major customer wins, notable events during the year included the launch of a new initiative targeting cable operators, the introduction of a new compact media gateway platform, expansion of the successful MetaSwitch Partner Program, and product enhancements for IP Multimedia Subsystem (IMS) compatibility. The division also received several awards including the Frost & Sullivan award for Product Differentiation, Internet Telephony Product of the Year Award, and Broadband Properties Top 100.

* Data Connection's Network Protocols Division strengthened its leadership position in the fields of IP Routing, MPLS, Voice-over-IP (VoIP) and Session Border Controller source code solutions. The Division increased its year-on-year revenue by 21%, added several major new customers, and shipped new products such as IP Multicast, and increased IPv6 functionality and enhancements to the optical product family. Data Connection's VoIP technologies, which include SIP, Megaco/H.248, and MGCP, continue to enjoy strong demand from OEMs requiring core IMS technologies. DC-SBC, the industry's only portable software Session Border Controller specifically designed for OEMs, has obtained design wins with top OEM's in the industry.

* The company's Internet Applications Division, which continues to invest heavily in IMS applications, had a successful year marked by the delivery of new enhanced voice services solutions as part of its UC-Portal applications platform, along with further customer wins and deployments among North American Tier 1 Service Providers. UC-Portal is used by Service Providers to deliver a Unified Communications service to subscribers, incorporating both multi-media messaging and innovative real-time telephony services, giving subscribers control of how they communicate regardless of whether they are served by existing fixed or mobile networks or Voice over IP. UC-Portal deployments continue apace with millions of mailboxes installed.

* The Enterprise Connectivity Division's strategic relationships with IBM, Microsoft, Cisco and other major OEMs continue to thrive, and the division has once again been highly profitable.

In accordance with the objectives of the Employee Benefit Trust, which holds 100% of the company's shares, the profits will be distributed to the employees in recognition of their contribution to the success. This unique ownership structure has been key to the company's long-term investment strategy, and its ability to recruit, develop and retain the very best talent - leading during this past year to its #5 ranking in the Sunday Times' 2006 list of the '100 best companies to work for'.

About Data Connection (DCL)

Data Connection Limited (DCL) is the leading independent developer and supplier of Unicast and Multicast IP Routing, MPLS, SIP, MGCP/Megaco, SBC, ATM and SNA portable products delivered to OEMs, along with the UC-Portal IMS application platform for messaging and enhanced voice services delivered to Service Providers. Customers include the world's largest software and hardware vendors, including Cisco, IBM, Lucent, and Microsoft, and major service providers such as AT&T, British Telecom, France Telecom and Verizon. With over 350 employees, Data Connection is headquartered in London, UK with US offices in Alameda, CA, Boxborough, MA, Dallas, TX and Reston, VA. For more information: www.dataconnection.com.

About MetaSwitch

MetaSwitch, a division of Data Connection, is an industry-leading vendor of IP Multimedia Subsystem (IMS) switching and applications solutions for both packet and circuit-switched networks. Its widely deployed call agent, media/signaling gateway and application server platform supports a full range of legacy Class 4/5 capabilities and enhanced services, and scales from a few hundred to millions of subscribers in both integrated and distributed configurations. MetaSwitch customers include Tier 1 carriers and major regional competitive local exchange carriers, as well as operators of broadband wireless, cable and fiber networks. For more information: www.metaswitch.com

Data Connection and MetaSwitch are trademarks of Data Connection Limited and Data Connection Corporation. Brands and products referenced herein are the trademarks or registered trademarks of their respective holders. Copyright [c]2006 Data Connection Limited