News Release

For Immediate Release

BEDMINSTER, New Jersey, January 13, 1999 — The US economy may have fluctuated in the third quarter of 1998, but the manufacturers of business telephone systems continued the strong growth trend. Manufacturers of PBX and Key/Hybrid systems shipped 18% more Stations/Lines than in the second quarter of 1998. This is as reported by The Eastern Management Group's 3Q98 Monitor^sm Report, which tracks the sales and market share of PBX and Key/Hybrid Telephone System manufacturers.

Third Quarter 1998 PBX Total Line (Station) shipments increased 15.7% over the same period last year (3Q97) resulting in shipments of more than 2.3 million lines. Total PBX system shipments were up 10.7% over third quarter 1997 and 14.9% above second quarter 1998. Lucent continued to be the market leader for both Total Lines and Systems shipped in 3Q98 with 33.1% of the Total Lines market and 22.9% of the Systems market. Nortel remained in the number two spot for Total Lines with a 26.3% market share. Mitel kept the number two spot for Systems with a 20.6% market share, an increase of 6.6% over second quarter 1998.

Key/Hybrid Total Line (Station) shipments increased 3.6% over the third quarter 1997 and 17.4% over the second quarter 1998 volume resulting in shipments of 2.3 million lines. The shipment of systems increased as well with a 3.6% increase over third quarter 1997 and a 10.9% increase over second quarter 1998. Lucent is the market leader in both Total Line (Station) shipments and systems, with 24.7% and 26.8% market share respectively. Nortel remained in the second spot with 15.3% and 13.2% market share respectively. Panasonic was a close third for the System shipments with a 12.9% market share.

About The Eastern Management Group

The Eastern Management Group is the oldest and largest management consulting and market research firm engaged by clients exclusively in the telecommunications industry. For more information about the Monitor program or The Eastern Management Group, please call (908) 306-8800 or visit us on the World Wide Web at www.easternmanagement.com.

Contact:
Rikke H. Kasse
The Eastern Management Group, Inc.
(908) 306-8800 Phone
(908) 306-9595 Fax
Rkasse@EasternManagement.com