PictureTel Announces Licensing Agreement With Microsoft; PictureTel's Siren Audio Technology To Be Used in Windows XP.

Business Editors/Hi-Tech Writers

ANDOVER, Mass.--(BUSINESS WIRE)--March 26, 2001

PictureTel(R) Corporation (NASDAQ:PCTL), the world leader in integrated collaboration, today announced its agreement with Microsoft Corporation (NASDAQ:MSFT), to license its patented Siren(TM) wideband audio technology for use in the upcoming Windows XP and future versions of Windows.

In addition, third party developers can harness this platform technology to add natural conversation to multimedia applications.

PictureTel's Siren technology is the international standard endorsed by the International Telecommunications Union (ITU) for wideband audio compression. The technology will enable Microsoft Corp. to provide the highest quality audio experience to Windows XP users who are connected to the Internet via even modest bandwidth speeds.

Siren technology will be part of the Windows operating system platform. Microsoft has announced that the Windows operating system will include support for IETF standard Session Initiation Protocol (SIP) and other real time communications capabilities.

As a result, third party developers will be able to easily integrate high-quality Siren sound into a wide variety of services and applications. Financial terms of the agreement were not disclosed.

"The PC has become a powerful platform enabling a variety of experiences beyond personal productivity to include music, digital photos, interpersonal communications and more, and Windows XP will play a vital role in making these new user experiences more accessible and more compelling to more people than ever," said John Frederiksen, general manager of Windows XP Marketing at Microsoft. "We believe PictureTel's Siren represents best-in-class technology that will play an important role in making the voice communications experience with Windows XP simply outstanding for our customers."

"Microsoft's commitment to PictureTel's ITU-endorsed Siren high-fidelity technology underscores our market leadership position," said Lewis Jaffe, president and chief operating officer, PictureTel Corporation. "Poor audio quality has traditionally proved to be videoconferencing's Achilles heel. We have maintained a deep commitment to research and development throughout our history - and today are very proud to announce that Microsoft has selected the PictureTel-developed Siren as its audio backbone for Windows XP. Windows XP is a bold step into enabling simple and cost-effective universal collaboration capabilities and we are excited to be a part of this very significant advancement."

With this agreement, PictureTel products will be well positioned to interoperate with leading voice-over-IP and video-over-IP applications and will facilitate PictureTel's continued leadership in broadband communications.

About Siren

Siren is a wideband audio compression algorithm that was approved in 1999 as standard G.722.1 by the International Telecommunications Union (ITU), the international body responsible for the standardization of telecommunications technology. PictureTel developed this technology to meet the demanding audio needs of the multimedia community.

The algorithm works for all kinds of audio signals - speech, music, singing etc. G.722.1 provides wideband audio (7Khz of audio bandwidth), closer in quality to FM radio than to ordinary telephone calls that are limited to only 3.2khz of audio bandwidth. Until now wideband coding was only possible using ITU-T Recommendation G.722 (at double the bit rate of G.722.1) or a proprietary algorithm.

This is a significant bandwidth savings, and opens a whole new world of applications. The Siren technology, source code kits, and patents needed to implement G.722.1 can be licensed from PictureTel.

Siren currently serves as the audio backbone for PictureTel's revolutionary iPower(TM) family of integrated collaboration solutions.

The PictureTel 900 Series(TM), the first solution in the iPower family, combines videoconferencing, the PC, and the Internet to deliver intuitive, media-rich remote communications that provide the first real synonym for face-to-face interaction for the most demanding business applications.

About PictureTel

PictureTel Corporation (NASDAQ:PCTL) is the world leader in developing, manufacturing, and marketing a full range of visual- and audio- collaboration platforms. PictureTel also owns 1414c, a communications ASP that greatly simplifies the network complexity inherent in mixed rich media collaboration.

PictureTel markets network conferencing servers in addition to the complete range of end-point products and delivers a global capability to service, support and provide complete solutions for customers needing rich media communications. PictureTel is fundamentally in the business of eliminating the barrier of distance, enabling people to be Anywhere Now.

This release includes projections and other forward-looking statements about the company's revenues, earnings, and other measures of economic performance. Actual results could differ materially from forecasts due to many factors such as, for example, competitive pressures, changes in technology, and the difficulty in forecasting in overseas markets and indirect channels.

Additional information concerning risks that could cause actual results to differ is contained in the company's annual report on Form 10-K and its Form 10-Q as filed with the SEC. The company undertakes no obligation to update publicly any forward-looking statements whether as a result of new information, future events or otherwise.

PictureTel is a registered trademark of PictureTel Corporation. PictureTel 900 Series, iPower, Share Ideas Simply and Anywhere Now are trademarks of PictureTel Corporation.

All other terms and products names may be trademark or registered trademarks of their respective owners.