SAN JOSE, Calif. - (March 27, 2000) -- Netergy Networks (formerly known as 8x8; Nasdaq: EGHT), a leading provider of highly integrated IP telephony solutions, today announced its Netergy Advanced Telephony System (ATS). The first commercially available, all-Internet protocol (IP) iPBX hosting solution, the Netergy ATS allows service providers to offer Voice over IP (VoIP) dial tone and advanced private branch exchange (PBX) services to business customers over any broadband IP connection, including DSL, cable, T1/E1, frame relay and, when available, broadband wireless.

By providing the ability to host iPBX services from a data center or central office, the Netergy ATS revolutionizes the delivery, management and user interface mechanisms of voice services for enterprises. iPBX services allow customers to gain all of the advantages of a PBX, essentially a private telephone system, without having to purchase and maintain the equipment. In addition, the use of an IP network to offer services lowers costs and allows for new functions such as point-and-click computer control of the phone network, seamless telecommuting, unified messaging and advanced find me/follow me capabilities.

"Our iPBX hosting solution changes the landscape for service providers and their enterprise customers," said Dr. Paul Voois, Netergy Networks' chairman and CEO. "The old world of proprietary, circuit-switched voice networks is transitioning to a new world of IP-based voice services. The Netergy Advanced Telephony System gives CLECs (competitive local exchange carriers) and ISPs (Internet service providers) the means to compete with incumbent carriers on price, and to free their enterprise customers from the constraints of expensive and difficult to manage on-site PBX equipment. In addition, the Netergy ATS gives service providers the tools to become telephony applications service providers, delivering a rich set of value-added services starting with iPBX hosting and unified messaging."

"As a CLEC, we've been a reseller of dial tone because building our own network was not economical," said David Carter, CEO of Dialink, which will be offering services based on the Netergy ATS to its customers. "To differentiate our offerings from those of the ILECs, we've offered turn-key telephone solutions to our customers, including circuit-switched PBX equipment. To secure a new customer, we used to have to catch him just as he was ready to spend $20K on a new PBX. The Netergy ATS lets me capture customers when they are small and, because it scales so well, grow with them.

"With Netergy," continued Carter, "there are advantages for the customers and for Dialink. The customer doesn't have to make large capital investments, and our recurring revenue grows as he does. And the system is lowering our service costs dramatically by giving the customer the power to make his own changes easily. The Netergy ATS represents a huge change in our business and offers us a tremendous opportunity to grow it."

The Netergy ATS consists of three elements: the iPBX Server System that provides the core PBX functionality, Media Hubs that connect standard analog telephones to the enterprise network, and advanced user interfaces that deliver control to the enterprise customer.

Architecture

The Netergy iPBX Server System resides on a cluster of carrier-grade Sun Microsystems' Netra t1 Servers running the Netergy iPBX Server Software. The iPBX Server System is located in the service provider's central office or network service center, and it is connected to the customer premise via a broadband pipe (DSL, cable, T1/E1, frame relay and broadband wireless), which can also be used for Internet connectivity. At the customer premise, Netergy Media Hubs connected to the enterprise local area network adapt standard analog telephones and fax machines for use with the ATS. Interconnection with the PSTN is provided via a VoIP gateway in the central office, while all other connectivity is provided via the IP backbone. Netergy ATS supports standard IP telephony protocols for interoperability such as H.323, SIP, MGCP and DPCP. Each Netergy iPBX Server System supports up to 100 discrete iPBXs, and up to 10,000 extensions.

Scalability, Flexibility and Geographic Independence

By adding Netra t1 servers to the cluster, the Netergy iPBX Server System scales seamlessly to 100,000 extensions or more. System managers can easily link iPBX instances together to provide unified extension spaces that can serve enterprises with hundreds of extensions and which are geographically dispersed.

Functionality

The Netergy iPBX Server System provides complete PBX functionality: call hold, call transfer, multi-way conferencing, multi-line phone support, paging, hunt groups, voice mail (options include interactive voice response menus and automated call distribution), direct inbound dialing, and more. Every Netergy iPBX Server System can be custom configured for each customer and a robust Netergy Software Development Kit provides complete support for the Java telephony application program interface (JTAPI), which links third-party CTI applications, service provider developed solutions and the Netergy advanced user interface to the iPBX. The Netergy solution suite includes support for external billing, voice mail, interactive voice response, automatic call distribution, auto attendants, directory service and unified messaging modules.

Administration

Service providers control and configure the iPBX Server System via a Web interface, allowing the system administrator to manage an iPBX from any location equipped with a browser. The administrator interface provides control of phone number block assignments, dial plans, service provisioning, DID assignments, iPBX status, bandwidth management and network topology.

Security

Because the Netergy Advanced Telephony System is written entirely in Java, each iPBX instance runs in its own Java virtual machine. The use of virtual machines ensures that iPBX instances cannot affect one another, ensuring that configuration problems in one iPBX will never affect any other PBX running on the system. Further, access to each iPBX instance is firewall and password protected to prevent unauthorized changes in configuration, and links to configuration terminals are encrypted to prevent eavesdropping.

Configuration

With the Netergy Advanced Telephony System, customers control their own moves, adds and changes using a Java-based application called Netergy Administrator. Adding new lines is easy: the customer simply connects an additional Netergy Media Hub to his IP network and the Netergy ATS does the rest. The Netergy ATS auto discovery mechanism configures the Media Hub automatically, and the customer uses the Administrator to assign extension numbers, associate user names and a voice mail account for each line. The Administrator also allows the customer to define hunt groups, set user permissions, define phone button functions, set voice mail parameters (optional), and much more, all with point-and-click ease.

High Availability

Each Netergy iPBX Server System uses a high availability mechanism that allows iPBXs to be distributed over a cluster of Netra t1 servers. In case of a server failure, the Netergy ATS distributes its iPBXs over the remaining servers in the cluster. In addition, server faults are signaled to system administrators with audible, pager and email alarms. To facilitate upgrades and maintenance, Netergy ATS also supports live upgrades, allowing new versions of the Server Software to be installed without shutting servers down. The live upgrade mechanism can also upgrade the Media Hub's software online and without service interruption.

User Interfaces

Designed by famed interface designer Alan Cooper, the Netergy ATS includes two ground-breaking user interfaces. The first, a Web-based application called Netergy Communication Center, runs on the end-user's desktop or laptop PC. Communications Center lets users configure and control their phones with point-and-click simplicity. Communications Center provides caller ID, deflection to voice mail, call transfers, conference call setup, on-screen directories and contact management and call logging. It also lets users setup and control their voice mail, set forwarding numbers and filters, and setup personal speed dial simply and easily. Because it is Web-based, users can access the Communications Center from anywhere: in the office, at home or on the road. The Netergy ATS also supports a standard set of hook-flash activated keypad commands to access basic iPBX features such as call transfer and conferencing.

The Netergy Advanced Telephony System also supports the Netergy Switchboard for attendants and receptionists. Running on a standard PC, Switchboard provides caller ID, drag and drop transfers, graphic call hold aging indication, general voice mailbox management, onscreen corporate phone directory, all in an intuitive interface.

Availability

The Netergy Advanced Telephony System will be commercially available in September 2000. The system is currently in limited deployment with selected service providers.

About Netergy Networks

Formerly known as 8x8, Netergy Networks is a leading provider of highly integrated IP telephony solutions to telephone service providers and telecommunication equipment manufacturers. Netergy Networks' IP telephony solutions include network software and systems as well as embedded technology. The company is based in Santa Clara, California. For more information, visit Netergy Networks' web site at www.netergynet.com.