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Vice President, Corporate Marketing

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1 Vice President, Corporate Marketing
GlobalPress IT Summit Mark F. Whittier Vice President, Corporate Marketing

2 About Tekelec Tekelec is a high-performance network applications company focused on accelerating the transition to IMS networks. Industry leader in next-generation signaling, switching, and value-added applications Leading the transition to IP Multimedia Subsystems (IMS) architecture Proven track record with over 25 years in the industry Financially solid -- strong growth in all markets Corporate headquarters near Research Triangle Park in Morrisville, North Carolina, with R&D facilities, customer support, and sales offices worldwide World-wide market leadership… Through strategic acquisitions, we have extended our dominant market position in signaling to next-gen switching and applications. We take great pride in our ingenuity, innovation, and ability to rapidly create and deploy unique solutions that serve our customers and lead our industry forward. We have more than 165 patents issued and pending. During the last two years, we are the only company in our space to increase R&D spending on an absolute basis. We have sustained positive growth through some of the most difficult years in the telecommunications industry.

3 Worldwide Market Leadership
Tekelec is the number one leading global provider of signaling equipment in According to Venture Development Corp. (VDC), Tekelec has approximately 38% global signaling market share, including 61% market share in North and South America1. Tekelec is the number one provider of signaling equipment in North and South America for 100% market share of stand-alone STPs in India2. Tekelec is the leading provider of hybrid media gateway softswitches in 2005 with over 25% market share, when ranked by revenue3. Tekelec is leading global provider of media gateway – ATM channels in Tekelec is first in worldwide media gateway voice over packet (VoP) shipments, second in overall VoP ports shipped in Q . 1. Venture Development Corp. Worldwide Core Infrastructure Report, June Tekelec Research and Current Customer Base 3 . Dell’Oro, IP Telephony Carrier Report, Q1’06 5/25/ Dittberner, Next Gen Voice Equipment Report, November 2005.

4 Heritage of Innovation and Leadership
Argentina – ‘06 Africa – ‘06 ‘04 Communications Software Portfolio Introduced Russia – ‘06 Middle East – ‘05 Thailand – ‘05 ’05 iptelorg acquired – advancing IMS portfolio India – ‘04 Mexico – ‘03 Global Growth ’00 Advanced IN and Packet Applications Singapore – ‘03 Brazil – ‘02 ’03-’04 NGN Switching Portfolio Introduced England – ‘98 Portfolio Growth ’92 STP Introduced Tekelec has a great history of innovation, quality, and customer service The past 5 years have shown rapid growth, both in portfolio mix and regional solution offerings The future is even more promising with the emergence of IMS and converged networks ’99 First IP Signaling Network ’89 Market-Leading SS7 Test Equipment 1979 2006 For over 25 years, Tekelec has recognized and seized growth opportunities, and with its ability to adapt and evolve, the company has led key telecom market segments.

5 Recent Awards Tekelec Honored by AT&T as Outstanding Supplier
Tekelec received one of 49 supplier recognition awards for its work in helping the AT&T companies deliver outstanding service to its customers during the past year. Frost & Sullivan Award for Product Line Strategy for the World Application and Media Server Markets Tekelec has employed Best Practices that when combined allow it to maintain its product line strategy leadership in the application and media server markets.

6 Diverse Global Customer Base
Billions of calls a day; millions+ subscribers - 1,000 systems different networks - 30 different countries Over 1 billion mobile calls through our NGN MG T8000 VoIP Applications Server reaches 100 customers, 150 networks, 500K lines Over 225 switching customers worldwide

7 Solid Financial Performance (Q3-06)
Revenue 2005 – Record $536.9M – up 46% Year-over-Year (YoY) from $368.9M in 2004 Orders 2005 – Record $629.3M – up 22% YoY Backlog 2005 – $573.3M – up 19% YoY Revenue (YTD) - $399.2M – up 15% YoY Over 40% of revenue in Q4 ’05 came from international sales Significant revenue growth YoY in all of our regional markets 23% of revenue devoted to R&D investment Q3 ’05 Notes Network Signaling Group revenue increased to $88.2 million, up 13%, compared to $78.0 million in Q3 ’04, and increased 8% sequentially, marking the highest quarterly signaling revenue in the history of the Company. Switching Solutions Group revenue increased to $37.6 million, up 149%, compared to $15.1 million in Q3 ’04, and increased 13% sequentially, as we added 16 new switching customers during the quarter. Communications Software Solutions Group revenue increased to $9.8 million, up 216%, compared to $3.1 million in Q3 ‘04, and increased 38% sequentially. Twenty-five years of financial stability and growth even during the industry’s most challenging years.

8 Recent Press Announcements
Tekelec Announces TekCore IMS Core Platform CSCF capabilities evolve EAGLE 5 ISS for delivery of IMS services today Tekelec Announces TekMedia ‘IMS-Ready’ SMS Solution Greater network control and efficiency, network security, real-time data management, pre-paid billing, message storage Tekelec, TechnoServ A/S Enable Real-Time Information Improved Service for 3.2M SMARTS Customers in Russia Tekelec Honored by AT&T as Outstanding Supplier Tekelec Joins Global Interoperability Trial to Drive the Adoption of ‘Plug & Play’ in the Telecom Industry A Tekelec 8000 Converged Multimedia Gateway will be controlled by a third-party mobile switching center (MSC) server/wireless softswitch using the 3GPP Open Mc standard interface.

9 Tekelec’s Focus – the Transition to IMS
Tekelec provides high performance network applications – accelerating a seamless transition to the converged network. Providing integrated performance and service-management functionality Developing value-added fixed, mobile, and IP services Applications Leveraging expertise in signaling – the core of the network – to transform the delivery of services Providing the core CSCF to unleash the power of next-generation applications today…while building tomorrow’s foundation Control Enabling operators to offer new revenue-generating services, both fixed and mobile, with gateways and mobility services Leading the industry with advanced VoIP delivery for business and residential users Access

10 Tekelec’s Solution Families
Signaling & Session Control Number Portability Mobility Management Flexible routing solutions integrated on EAGLE® 5 ISS for mobile network management -virtual HLR manager (G-Flex®) & Equipment Identity Register (EIR) Unsurpassed signaling expertise offering SS7, SS7 over IP & SIP solutions: operators save costs, achieve efficiencies, easily roll out new services and transition to next-gen (IMS) networks Industry-leading number portability solution: porting for GSM networks, CDMA networks, fixed networks, and for intra-carrier (TDMA/CDMA-to-GSM) number retention Messaging Switching & Media Gateways Convergence Solutions Next-gen messaging solutions — store-and-forward SMS to advanced multimedia; reduces costs; simplifies OA&M; based on open 3GPP standards using SIP core. An array of Class 4/5 switches, gateways and application servers supporting IP, ATM and TDM switching, as well as 2G-3G-FMC integration with an IMS-ready architecture IMS solutions transform today’s networks; guide transition to create access-independent networks that open up lucrative new markets Performance Management (IAS) Revenue Generating Applications (SCS) Hosted VoIP Integrated applications ensure in-depth understanding of networks; enable wireline & wireless operators to make sound business investment & cost-reduction decisions Versatile IN applications; enable creation & customization of services rapidly & cost-effectively, improving customer satisfaction, reducing churn & generating new revenue Leading hosted IP telephony applications that enable service providers to reliably and cost-effectively deliver VoIP solutions

11 Tekelec’s Focus on IMS Transition
Solutions for Revenue generation today - maximize return from TDM services and IMS investment Voice services to seamlessly roam from mobile to fixed networks = “FMC” Messaging services for 2.0/2.5/3G networks Capacity relief for core SS7 network network optimization by utilizing broadband data channels vs. narrowband voice channels Interwork SMS and IM environments Add value to presence with TDM call status Forward compatible call agents, media gateways, and media gateway controllers – No stranded investment IMS Services Transitional Network Elements TDM Services Future Proof- Create the IMS foundation today and operators to optimize network investment TDM IMS

12 “CIO’s Dilemma” Decline in use of desk Stations (PBX, Key Systems, Centrex) Continued Opex, and Capex renewal Upgrades to IP under consideration Increase in use of mobile devices for internal use Need for a converged service for Enterprise and Cellular Service to reduce overall service cost and provide improved business continuity Continuing Investment in WLAN - often is “network of choice” and wide coverage Voice primarily but messaging/ increasing use Single Number Single Service Enterprise & Cellular

13 Drivers for Fixed Mobile Convergence
Enterprise Fixed Networks Mobile Networks Integration of WiFi Assets with Macro Cellular to reduce cost of telecom Elimination of Dormant PBXs & PRI Interconnect Single Number & Single Device Customer retention by providing mobility Bundled services along with voice, data, and video/ entertainment Combat VoIP Carriers Penetrate enterprise & become single provider for voice services Combat VoIP carriers and stop reduction in ARPU Reduce roaming charges Offload 2G radio in Dense Areas Fixed/Mobile Networks MVNO’s Service layer convergence (prepaid, VPN, free phone, IN/SCP, etc.) Combat VoIP carriers Reduce cost and offload from cellular to IP Reduce roaming charges

14 Tekelec IMS & FMC Solutions

15 Tekelec FMC Architecture
Wireless SIP Convergence SIP Front Legacy Front Application Server Next Gen SCP T-6000 IN SCPs Single Identity Prepaid SIP T-3300 MSC S-CSCF VLR SMS SSP SIP T-3000 MGCF T-8000 MGW

16 Summary Enterprises are using mobile service as a primary voice service vehicle Cost overruns in enterprises for mobile services is forcing the major corporations to work with their mobile carriers to develop new solutions for cost reductions Opportunity for Network Operators (Mobile & MVNOs) to provide new enhanced hosted enterprise services to reduce the overall cost of running enterprise networks New revenue opportunities for the mobile and MVNOs Tekelec has market leading IMS-enabled solution for seamless mobility and in deployment with various carriers around the world

17 Tekelec Differentiators
Tekelec has unparalleled experience and expertise in: The media, control and application layers of the network Core session control and subscriber management Low latency, high transaction, mission critical network applications High value revenue generating, real-time applications High capacity and distributed media gateway & control capabilities Integrated data acquisition and end-to-end business intelligence across legacy and IMS networks Network migration of multiple technologies. Tekelec solutions … Leverage existing investment in the network, enabling a graceful transition to the converged network Optimize the IMS core for high performance multimedia applications Are truly next gen and not based on legacy technology Are based on open network topology Have highly integrated OAM Tekelec’s experience, expertise and significant footprint in network applications,uniquely positions us to seamlessly transition carriers to the converged network


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