ZyXEL Announces Distribution Agreement with Tech Data U.S.; Expands SMB Market Footprint with New Channel Partner Program Initiatives

Business Wire, May 3, 2005

ANAHEIM, Calif. -- ZySTAR Channel Program Delivers New Revenue Opportunities, Increased Profits to Solution Providers

ZyXEL Communications, a leading provider of broadband access solutions, today announced that Tech Data Corp. will distribute its broad range of secure networking solutions. The agreement expands ZyXEL's North American Channel Partner Program in which qualified resellers will receive special benefits and tools to improve service to small- and medium-size business (SMB) customers.

The North American ZySTAR Channel Program will support and complement ZyXEL's global channel program, providing market development/co-op funding opportunities, product discounts and rebates, and access to ZyXEL's full product line of enterprise-class products that are scaled to the needs and budgets of SMBs including award-winning firewall, Internet security solutions, Ethernet and gigabit switches, wireless networks, VoIP and MxU solutions.

"On a worldwide basis, ZyXEL recognizes the importance of value-added resellers in creating and delivering solutions that solve real customer problems," said Munira Brooks, vice president of sales, marketing and business development at ZyXEL. "Our goal moving forward is to aggressively expand our presence in North America to satisfy the growing demand for secure networking products. To accomplish this goal we are placing more emphasis on channels that provide solutions above and beyond our traditional service provider markets. Our new program focuses on building stronger relationships with these partners and provides them with the necessary tools and resources to create demand, secure new business and increase margins."

Tech Data is a leading global provider of IT products, logistics management and other value-added services and it will provide ZyXEL's channel partners with greater choice in sourcing products.

"As a global broadline distributor, Tech Data provides resellers with the economies of scale and infrastructure of a market leader combined with the specialized product offering and technical expertise customers need," said Joe Serra, Tech Data's vice president of networking and high-end storage product marketing. "The addition of leading networking manufacturers like ZyXEL helps resellers target the growing awareness for secure networking solutions, especially in the SMB market."

ZySTAR Program Raises the Bar

ZyXEL is actively pursuing relationships with select North American VARs, solution providers and systems integrators who can take advantage of ZyXEL's expanded set of distribution partners that include Sprint North Supply, Tech Data, Ingram Micro, and Wynit. These relationships provide ZyXEL's channel partners with more sourcing options allowing them to aggregate purchases, increase product availability for their customers and lower costs.

"We've expanded our program to recognize the value that a face-to-face, consultative sales approach provides in creating local demand and delivering complete solutions," said Dana Patrick, manager, North American Channels.

The ZySTAR Channel Program is highlighted by three tiers of participation that offer increasing levels of reseller benefits. Highlights include the ability to participate in market development funding opportunities which assist resellers in the development of targeted demand-creation activities and product discounts that allow partners the ability to realize immediate margin benefits. In addition, ZyXEL has introduced focused training and certification programs that take place throughout the year.

According to Al Toper, manager of technical services for STI Computer Services: "Our solutions address a growing demand for electronic data in the healthcare industry. Due to the sensitivity of the data we deal with, security is of utmost importance and ZyXEL's solutions ensure a secure network environment while maintaining performance and reliability." STI Computer Services is a vertical solutions provider targeting the healthcare market and one of the largest ZyXEL security channel partners with an installed base of several hundred ZyXEL firewalls. "Our participation as a security channel partner provides us with access to not only ZyXEL's security products but also to superior sales and technical support of which we are particularly impressed. We commend ZyXEL on their obvious commitment to the channel."

North American VARs, solution providers and systems Integrators who are interested in more information on the ZyXEL VAR Channel Program can contact ZyXEL Communications, at 714-632-0882 or sales@zyxel.com.

About ZyXEL Communications

ZyXEL Communications Inc., with U.S. headquarters in Anaheim, is one of the world's foremost suppliers of broadband networking and Internet connectivity/routing products. ZyXEL is focused on developing xDSL, cable access, broadband-sharing, wireless networks, firewall and network security solutions for a large target audience including telcos, cable operators, ISPs, small- to medium-sized businesses, SOHO and institutional MxU (multi-tenant unit/multi-dwelling unit) markets. Some of ZyXEL's largest customers include: Sprint, Time Warner, Charter, Earthlink, Chunghwa Telecom, Deutsche Telekom, France Telecom, Telefonica Brazil, Telia, Verizon, and many others. For more information on ZyXEL Communications and its broadband solutions, visit the company's Web site at http://www.us.zyxel.com.