GSM Market Embraces CPS Mobile Phone Location System With Major Cash Injection - Cambridge Positioning Systems' CURSOR system - Company Financial Information

Cambridge Telcom Report, August 16, 1999

The mobile communications market has taken an important step towards identifying a single, preferred technology for location systems for mobile phones. A further USD15 million of venture capital has been invested in Cambridge Positioning Systems (CPS) by a group of investment companies that includes Argo Global Capital, manager of GSM Capital, a North America venture capital co-operative funded by the world's leading mobile communications companies.

The financial backing for CPS' CURSOR system -- due for commercial launch by the spring of 2000 -- is being given in preference over a range of competing location solutions currently being developed worldwide. Boston-based Argo Global Capital conducted a comprehensive global review of location systems before singling out CPS for the new funding.

The backing of Argo Global Capital is likely to be seen as a clear endorsement by the global mobile communications industry of the CURSOR system as the leading solution in the mobile location market.

CPS plans to invest in a broad range of activities including delivering UK, European and pilot North American networks for CURSOR, growing the headcount for the CPS engineering team, creating a portfolio of GSM CURSOR products (GSM 900, 1800 and 1900) and accelerating the development of new partnerships with handset manufacturers, mobile networks and third party service providers.

Argo Global Capital and Alta Berkeley Associates jointly led the latest tranche of finance that included a significant further commitment from 3i, Prelude, CRIL, Sofipa International and Scientific Generics.

Argo Global Capital's strategic partners include Deutsche Telekom (Germany), France Telecom (France), Aerial Communications (USA), Microcell Telecommunications (Canada), Esat Telecom (Ireland), Omnipoint Communications (USA), Singapore Telecom (Singapore) and SmarTone (Hong Kong).

"CPS offers the lowest cost location technology which also demonstrates high levels of location accuracy. CPS is at an advanced stage of product development, and when you couple that with the strong and experienced management team, we believe CPS will lead the emerging location market." commented Ronald White, Vice President of Argo Global Capital.

The CURSOR system is being demonstrated in the world's first large-scale implementation of mobile phone positioning services, currently taking place in and around Cambridge, UK. Other international trials are scheduled in the future. CPS and its current service partners -- Vodafone, the AA and Maxon -- are using the demonstration to identify customer requirements for location-based services.

In addition to the personal safety applications, CURSOR will open location-based services to the mass market through services such as route-finding ("Where am I?", "Where's my nearest ... ?") and asset-locating as well as corporate, closed user group applications such as field sales, engineering management or vehicle management. Until now, the location based information services market has been constrained by the high cost of equipment for GPS-based solutions and the low accuracy of mobile network cell ID solutions.

The new funding is the latest in a series of achievements for CPS, following on from a successful technical trial for CURSOR, endorsement from consumers who have tested CPS's location services, the recruitment of John Peett -- one of the original founders of Vodafone -- as a non-executive director and chairman of the board, and the announcement of a new partnership with ARM.

"The size of this funding represents an unequivocal endorsement of our strategy from both new and existing investors and will help us create a powerful platform to deliver our business objectives." said Chris Wade, CEO, CPS.

CPS is an organisation that develops and markets location services that have been integrated into the existing mobile network and a mobile phone handset. CPS' location system called CURSOR takes the form of a minor software upgrade to the mobile phone and a low cost overlay solution to the mobile infrastructure. CPS is developing applications that will enable mobile location based services for the consumer and corporate markets. Examples include vehicle recovery assistance, information services, fleet and asset management.

CPS' location services are a key catalyst to the emerging mobile internet access market and, as such, the company is taking a lead in commercialising the concept of location based internet applications and services.

Investor Partners: CRIL, Scientific Generics, University of Cambridge, Prelude, 3i, Alta Berkley and Argo Capital. CPS is based in Cambridge, England. The company's web site can be found at www.cursor-system.com.