1. IP Centrex – State of Deployments Dieter Rencken Senior Product Manager

2. 2004 : Is it the Year of IP Centrex? “ Recent announcements by Traditional Carriers show they are serious about convergence ” - Frost & Sullivan 01/04 “Aussie ILEC Telstra Says G'day to IP Centrex” - IP Voice’s New Telephony 1/22/04 “SBC to Offer Nationwide Hosted VoIP” - XChange 11/20/03 “The time is right for IP Centrex” - NetworkWorldFusion 1/26/04

3. 2004 – Is it the Year of IP Centrex? Service Providers intend to deliver services across the globe –North America: SBC, ATT, MCI, Bell South, Verizon, Bell Canada, Telus, QWEST, Sprint, ICG, Go Beam, Level 3, countless regional SPs –Central, South America: Telefonica –Europe: BT, Telia, France Telecom, regional SPs –Asia Pacific: NTT, Fusion, Singtel, Telstra, Telstra Clear, BTN Access (PCCW), Telecom New Zealand, Deployments reported in small & large Enterprises Momentum increasing in Sales of IAD/Session Border Controllers and IP phones

4. Target Customers Small/Medium Enterprises –20 to 200 Users –Centrex/Key System Alternative Large Enterprises –> 500 Users –PBX Alternative –Branch Offices Multiple Location Enterprises –HQ, Satellite Offices, and Remote Users –Private Dialing and Routing –Integration of heterogeneous networks and equipment

5. Early Adopters : Examples Banks, Financial Services –Distributed Locations who need unified telephone services and converged applications. –Want private dialing, seamless call support across locations, remote loan agents –Westpac Bank (AU) : 30,000 seats Government –Ashland, Oregon Small/Medium Enterprise –Anthony Vineyards Large Enterprise –Tokyo Gas (Japan) : all SIP deployment - 12000 seats

6. Key Learnings from Deployments Planning is Key : –Managed Network + SLA –QoS, VLAN segmentation –Endpoint provisioning VoIP endpoints have to be plug and play –Remote maintenance Open Standards –Maximizes Interoperability Both for provisioning & media/signaling –Gives customer’s choice

7. IP Phone Trends – Functionality Expanding Product Families from manufacturers offer choices for usage models 1 Line Make/Receive Calls Transfer Redial Hold 1- 2 lines Display + 3-4 Softkeys 3+ way conference Basic speedial Park, Pickup Local, Corp Directory Text/Data Apps 3 lines, 2 calls/line Graphics Display + 4 Softkeys Graphics Apps Full Duplex Speakerphone Make/Receive Calls Transfer Redial Hold 3+ way conference Basic speedial Park, Pickup Local, Corp Directory Text/Data Apps Graphics Display + 4 Softkeys Graphics Apps Full Duplex Speakerphone 3+ way conference Basic speedial Park, Pickup Local, Corp Directory Text/Data Apps 6 + lines, 2 calls/line HI Res Graphics Apps. Desktop Video in the future Occasional User Basic Communicator Moderate Communicator Heavy Communicator Make/Receive Calls Transfer Redial Hold Make/Receive Calls Transfer Redial Hold 1- 2 lines Display + 3-4 Softkeys 3+ way conference Basic speedial Park, Pickup Local, Corp Directory Text/Data Apps Make/Receive Calls Transfer Redial Hold Enterprise Mobile User Wifi enabled QoS, Security Small Graphics Display + 3-4 Softkeys

8. IP Phone Trends – Pricing TodayNext Year?2 Years? $100 $200 $300 $400 Market Adoption is the primary driver Occasional Use Basic Communicator Moderate Communicator Heavy Communicator

9. Hosted Network Vision - Today MediaBridgesMediaBridges GatewayGateway Managed IP NetworkManaged IP Network Call Server – Hosted TelephonyCall Server – Hosted Telephony GatewayGateway Enterprise IP PhonesIP Phones LANLAN AnalogPhonesAnalogPhones IP PhonesIP Phones IP PhonesIP Phones LANLAN AnalogPhonesAnalogPhones IP PhonesIP Phones IP PhonesIP Phones Media Bridges Gateway Managed IP Network Call Server – Hosted Telephony Gateway Enterprise IP Phones LAN Analog Phones IP Phones Enterprise LAN Analog Phones IP Phones

10. Hosted Network Vision – Tomorrow Multi-media Bridges Gateway Web/Data Collaboration, Presence, IM Managed IP Network Call Server – Hosted Telephony Gateway Enterprise IP Phones Personal Video Group Video LAN Enterprise IP Phones Personal Video Group Video LAN Analog Phones

11. Key Thoughts IP Centrex/Hosted IP Telephony is available today. Deployments range from small to large enterprises …early traction in distributed enterprises. Range of IP phone models deliver choice of functionality and price points. IP Centrex/Hosted IP Telephony services will evolve to be a full range of Unified Collaborative Communication services.

12. Thank You! For More Information: www.polycom.com www.frost.com www.polycom.com Polycom delivers…