PACIFIC GATEWAY EXCHANGE AND CISCO PROVIDE IP DATA SERVICES.

Pacific Gateway Exchange, Inc. (Nasdaq: PGEX), and Cisco Systems, Inc. (Nasdaq: CSCO), a provider of networking for the Internet, and Pacific Gateway's wholly owned IP subsidiary, Onyx Networks, Inc., are teaming up to provide IP data services worldwide as a Cisco Powered Network (CPN).

By implementing the high performance Cisco platform, Onyx Networks will experience improved time to market with value-added services for customers including individual customer filtration, best exit routing, and total packet control. With these Cisco routing techniques, the Onyx Networks Global IP backbone will offer comparatively lower latency and thus higher quality of service.

Onyx Networks has deployed Cisco's 12000 Gigabit Switch Router (GSR) series, the premier high end optical routers supporting multiple OC12, OC3 and gigabit Ethernet links in each chassis.

By implementing the latest Cisco products, Onyx Networks will take advantage of these advanced Cisco features:

-- 100% redundancy on its backbone, reducing opportunities for congestion 

-- Customer interface n + 1 redundancy

-- Synchronized/Centralized troubleshooting

"Achieving CPN status delivers a boost to us in validating our strategic plan to be one of the largest global ISPs," said Thomas J. Murphy, chief operating officer of Global Operations and IP Services of Pacific Gateway.

"We share the vision Cisco has consistently delivered to its customers and seek to elevate our network to new service heights."

"With the proven Cisco optical infrastructure and Onyx's IP data services for customers in Europe, the Pacific as well as the US, Cisco is excited to help Pacific Gateway Exchange become a major global ISP," said Larry Lang, vice president, service provider marketing of Cisco.

In collaborating with Cisco, Onyx Networks solidifies its entrance into the global ISP market by leveraging its parent company's investment in submarine cable networks. Pacific Gateway has expanded its market presence globally in Europe, the South Pacific and the US. Among other significant network infrastructure deployments, Pacific Gateway and KDD Submarine Cable Systems Inc. have agreed to form a joint venture that will construct backhaul telecommunications fiber and electronics between undersea fiber optic cable landing stations and major metropolitan centers in Japan to sell to a worldwide set of customers. The joint venture will employ a new architecture for the backhaul network wherein the cable terminating equipment will be located in the metropolitan area instead of at the cable landing point.

Stretching beyond its Pacific roots, Onyx Networks has recently established its European beachhead with the acquisition of Onyx Internet, Ltd., an UK-based ISP. With Onyx Internet's strong local brand and its membership in the London Internet Exchange (LINX) with over fifty Internet peering relationships, this acquisition enables Onyx Networks to roll out European IP services with a core team of highly trained European Internet professionals.

Onyx Networks, a subsidiary of Pacific Gateway Exchange, has turned up Cisco-based services in the following cities within the last quarter of 1999: London, San Francisco, Los Angeles, Chicago, Dallas, New York, and Washington, D.C, with Tokyo soon to follow.

Onyx Networks' participation in the Cisco Powered Network program provides technology to their current and future ISP business customers. Cisco equipment and software are helping Onyx Networks to deliver ISP technology and services.

About Cisco Systems

Cisco Systems, Inc. is a provider of networking for the Internet and can be found on the world wide web at http://www.cisco.com.

About Pacific Gateway and Onyx Networks:

Pacific Gateway, through its wholly owned subsidiary Onyx Networks (formerly named PGExpress), provides Internet and high bandwidth services to the global market. It is expanding its network and global points of presence to provide connectivity, colocation, managed data and other advanced Internet applications to the global Internet services market. The company is a diversified facilities-based international telecommunications carrier serving a wide array of domestic and international telecommunications providers and retail customers.

The company and its offshore subsidiaries are a party to forty-four operating agreements providing landing rights in twenty eight countries and have ownership interests in nineteen digital undersea fiber optic cable systems providing for the exchange of telecommunications traffic with foreign carriers. The company recently announced its commitment to invest over $150 million in the Japan-US and TAT-14 Cable Networks, positioning the company as a low cost provider of services for the future.

In addition, Pacific Gateway has a United States network spanning twelve of the major metropolitan cities in the United States. Pacific Gateway presently operates switching and international gateway facilities in New York, Los Angeles, Dallas, the United Kingdom, Russia, New Zealand, Japan, Australia, and Germany and is developing additional offshore markets. Additional Pacific Gateway information is available at www.pgexch.com. Onyx Networks information is available at www.onyx.net.

For more information, call 650/375-6700.