Internet Access: Marubeni Corp.'s Interactive Cable Communications, Inc. and SoftNet Systems, Inc. Plan to Deploy High Speed Internet Services to Japan - in joint venture - Company Business and Marketing

Cambridge Telcom Report, June 21, 1999

Marubeni Corporation's Interactive Cable Communications, Inc. and SoftNet Systems, Inc. Tuesday announced their plans to form a joint venture to accelerate the deployment of high speed Internet access to close to one million Japanese homes in the near future. Under the terms of the deal, subject to final due diligence, the two companies will adapt ISP Channel's successful business model to the market in Japan and will explore other opportunities throughout Asia. ISP Channel will supply VSAT (very small aperture terminals), caching, cable modem and cable head-end technology; capital; and ISP (Internet service provider) management experience, in exchange for gaining a significant equity interest in Interactive Cable Communications (ICC).

Interactive Cable Communications president, Noboru Fujino, said, "Established as the first Japanese data MSO, ICC has been providing high speed Internet access to multiple cable operators in Japan since November 1996. During the first three years of our operation, the number of Internet users in Japan has increased threefold, and demand for broader bandwidth is stronger than ever. We expect that, with ISP Channel's expertise in VSAT technology which minimizes the cost of backbone installation, as well as their experience in content services and operations, we can deploy our data MSO services more aggressively to numerous Japanese local cable operators."

"By joining forces with Marubeni's ICC, we can combine ISP Channel's technology and extensive cable modem experience with excellent existing cable infrastructure and aggressively deploy services to Marubeni's cable systems in Japan, as well as other cable systems in Japan and other Asian markets," said Dr. Lawrence Brilliant, SoftNet's chief executive officer. "We look forward with enthusiasm to assisting ICC in bringing the best high speed Internet access available to Japanese customers."

With approximately 15 million Internet users, Japan is an extremely promising market for high speed Internet cable services. Internet penetration in Japan is growing quickly. According to Japan's Ministry of Posts and Telecommunications, the percent of households with access to the Internet nearly doubled in the last 12 months, reaching 11% at the end of March.

Interactive Cable Communications, Inc. (ICC) is a Marubeni subsidiary founded in 1996 to provide high speed Internet access service over cable to Marubeni's close to one million customers in Japan already receiving other cable services from the company. Marubeni was established in 1858 and is one of Japan's leading general trading companies (sogo shosha). Marubeni's operations encompass domestic, import, export and offshore trade and investment activities, and range from the development of natural resources to the retail marketing of finished products. The company conducts these operations through a worldwide business network comprising almost 200 representative offices and around 700 affiliated companies in 83 countries.

California, USA-based SoftNet Systems, Inc., traded on the Nasdaq Stock Market Exchange under the symbol SOFN, is a leading high speed broadband Internet access and content services company focused on partnering with small to mid-sized cable operators. Through its ISP Channel, the company provides a complete turnkey Internet service to partnering cable affiliates.

ISP Channel's services to partnering cable affiliates include cable head-end equipment and integration, Internet backbone connectivity, and technical support and customer care twenty-four hours a day, seven days a week, and an ISP Channel Neighborhood local community web portal site. ISP Channel gives subscribers high speed Internet access at speeds up to 500 KB per second when downloading files, graphics, audio and video. Additional ISP Channel services include e-mail, personal web pages, news groups, and full multi-media capabilities. ISP Channel also provides access to Microsoft Internet Explorer and Netscape Navigator browsers.

Through SoftNet's Intellicom subsidiary, the company markets a satellite-based VSAT commercial Internet link. SoftNet's unique cost-saving technology infrastructure includes Intellicom VSAT satellite links to the company's network operations center (NOC), which replace more expensive terrestrial telecommunications data lines.

SoftNet's NOC is located in Silicon Valley, while its corporate headquarters is located in San Francisco. FMI: http://www.softnet.com, http://www.ispchannel.com, or 415-365-2500.