California Microwave Acquires Adaptive Broadband: Wireless High-Speed Data, Internet Access Technology

Business Wire, August 20, 1998

SUNNYVALE, Calif.--(BUSINESS WIRE)--Aug. 20, 1998--California Microwave, Inc. (NASDAQ/NMS:CMIC) announced today that it has acquired U.K.-based, Adaptive Broadband, Limited.

Adaptive has acquired from the Olivetti and Oracle Research Laboratory in Cambridge, U.K., a wireless broadband technology which offers unprecedented data rates over a point-to-multipoint radio link: 25 Mbps operating in the 5.8GHz unlicensed frequency band. For the first time, portable, low-cost wireless connections will be available at speeds comparable to wired network access speeds. High-speed connectivity at low-cost is made possible by Adaptive's unique combination of Time Division Multiple Access (TDMA) and packet-on-demand bandwidth management, based on asynchronous transfer mode (ATM) technology. Terms of the transaction were not disclosed.

Strategic Acquisition; Catalyst for Accelerating Growth

In its April 23, 1998, announcement of its new strategic direction, California Microwave indicated that it was in the process of acquiring TDMA technology for both its terrestrial wireless and satellite communications product areas. Adaptive's broadband technology will enable accelerated development of California Microwave's next-generation products which address emerging markets, such as Internet access, that are growing at 40% or greater. California Microwave estimates that its addressable market for point-to-multipoint systems, including narrowband, broadband, Local Multipoint Distribution Systems (LMDS), and satellite will reach $2.4 billion by 2001. According to a market research report by Pioneer Consulting, the market for local multipoint data services will grow to $6.5 billion by 2007.

Adaptive uniquely combines TDMA and ATM technologies to manage bandwidth in an extremely efficient way, and which can simultaneously support all types of multimedia traffic: Internet, real-time video, voice and other data. California Microwave will adopt Adaptive's technology to extend its Terrestrial Wireless Division's current narrowband radio products to higher data rates, and from multiple-address to point-to-multipoint applications. The company's EF Data satellite communications division will incorporate the TDMA/ATM technology into its next generation of packet-switched, data network products.

"The significance of Adaptive's contribution to the future of California Microwave cannot be overstated. We identified TDMA for Internet access as our number one technology need and have met that need with this acquisition. Adaptive's cutting edge combination of wireless and ATM technologies permits us to leap-frog older technologies, propelling California Microwave forward in our drive to be a major, in l player high-growth markets," commented Frederick D. Lawrence, chairman and chief executive officer of California Microwave.

Small/Medium Businesses: Major Markets for Wireless Broadband Access

Adaptive's initial products target Internet service providers, competitive local exchange carriers and alternate carriers, who will provide service to small and medium businesses that do not have access to broadband access services. Its products are particularly applicable to international opportunities where wired infrastructure does not exist or where competitive markets are developing, such as the privatization of the state-owned telephone company in Brazil. Adaptive is in the final stages of product development and several U.S. telecommunications service providers are evaluating prototypes. Launch of the first products is scheduled for mid-1999.

Wireless ATM Pioneers

Adaptive Broadband's scientific staff has been developing radio ATM technologies since 1993, capitalizing on the Olivetti and Oracle Research Laboratory's acknowledged lead in the wireless broadband field. Its 18 employees, many holding PhDs in electrical engineering, report to California Microwave's chief technology officer, Dr. Daniel L. Scharre, who is Adaptive's chief executive officer. Adaptive is a wholly owned subsidiary of California Microwave.

California Microwave, Inc. (http://www.calmike.com) is a leading U.S. supplier of satellite earth station and microwave radio infrastructure products and information and collection systems. Its focus is on transmission of high-speed data, especially for Internet traffic, via satellite and terrestrial wireless communications.

CONTACT: California Microwave, Inc.

Stephanie M. Day, 408/743-3429

sday@califmicro.com

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888/225-6789 (Toll-free)

http://www.calmike.com

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