DIALINK AND NETERGY NETWORKS DEPLOY WORLD'S FIRST HOSTED IP TELEPHONY SERVICE FOR BUSINESS CUSTOMERS

SAN JOSE, Calif. - (March 27, 2000) -- Netergy Networks (Nasdaq: EGHT) and Dialink today announced that Dialink is now offering hosted iPBX voice services using the Netergy Advanced Telephony System (ATS), a complete Internet Protocol (IP)-based private branch exchange (PBX) solution. The Netergy ATS allows Dialink to offer dedicated, carrier-class PBX services over IP connections to hundreds of small- and medium-sized businesses from a central location such as an Exodus Internet Data Center (IDC). With the deployment of the Netergy ATS, Dialink becomes the first local telephone company to offer Voice over IP (VoIP) dial tone to businesses. Formerly known as 8x8, Netergy Networks is a leading supplier of highly integrated IP telephony solutions. Dialink is a competitive local exchange carrier (CLEC) operating in the San Francisco Bay Area.

For CLECs like Dialink, the Netergy ATS provides value in two fundamental ways. First, it lowers the monthly costs associated with servicing a business customer by eliminating the need for traditional "heavy iron" PBX systems and by efficiently combining voice and data services onto a single broadband IP connection such as a DSL or T1/E1 line. Second, it allows CLECs and other telephony and data service providers to become telephony application service providers. The Netergy ATS's complete PBX functionality and unique, easy-to-use interface can be sold as value-added services, increasing the revenue each business generates for the CLEC. And by offering data services over the same broadband IP connection as voice services, the CLEC effectively becomes an ISP, further increasing its revenue per customer.

For this deployment, the Netergy ATS servers are installed in the Exodus Communications IDC in Santa Clara, California. Exodus IDCs have the broadband connectivity required to quickly connect Dialink customers to Netergy ATS servers, and Exodus's 24/7 monitoring and support work with the Netergy system's native redundancy to ensure high-availability.

"The Netergy ATS is transforming our business," said David Carter, Dialink's chairman and CEO. "Because it is IP-based, the Netergy ATS is dramatically more cost-effective than the circuit-switched systems it replaces. It lets us offer up to a hundred extensions to a customer with a single IP connection, lowering our costs for wholesale connectivity as well as our support costs. Once we have an IP link to a customer, it takes just minutes to add an extension, giving us a substantial customer service advantage over incumbent carriers.

"The benefits are not just on the cost side, either. With Exodus data connectivity, Netergy has effectively put us in the ISP business, and the productivity-enhancing features of the Netergy user interface are something that customers are willing to pay for. IP telephony technology is clearly the future of our business."

"The delivery of VoIP dial tone to businesses is a watershed event, and the Netergy ATS is making it happen," said Paul Voois, chairman and CEO of Netergy Networks. "The telecommunication industry is undergoing a fundamental shift from circuit-switched to IP-based networks, enabling a revolution in the delivery of voice services to businesses. The results will be lower costs to businesses for primary services and terrific new telephony applications that increase productivity. Netergy Networks' highly integrated IP telephony solutions will be a part of this revolution."

Dialink is both an inter-exchange carrier and CLEC located in the San Francisco Bay Area. The company provides calling card services for customers nationwide and local telephone service for business subscribers in the Bay Area. To differentiate itself from its competition, Dialink offers turnkey solutions and value-added services to its customers. For example, Dialink buys, installs and maintains circuit-switched PBX systems at its customers' sites, and provides service technicians to make moves, ads and changes on short notice.

"Dialink is the telecom supplier to the Tech Mart in Santa Clara, California," continued Carter, "which is a building occupied primarily by pre-funding startups. We supply phone service to each of these companies. When they get venture-capital funding and move to larger facilities, we often lose them as customers because we don't have the right product or connectivity to follow them. With the capability to deliver hosted iPBX voice services to these companies through a single IP connection, we'll now be able to retain these customers as they grow by simply leasing a DSL line to their new building."

About the Netergy ATS

The Netergy Advanced Telephony System consists of three elements:

• Netergy iPBX Server System: located in the CLEC's data center, a single iPBX Server System can support up to 100 business subscribers with up to 100 extensions each
• Netergy Media Hubs: Inexpensive customer premise equipment (CPE) that connect standard analog telephones to IP networks
• Netergy Communications Center, Switchboard and Administrator: A revolutionary set of interfaces that allow telephone users, attendants and system administrators to easily use and manage the Netergy ATS

"The Netergy ATS is a very compelling offering for the small- to medium-sized business," noted Brian Strachman, a voice and data communications industry analyst with Cahners In-Stat. "The solution provides all of the features of a PBX and more, while having none of the pricing issues associated with Centrex. Service providers should have no trouble finding a customer base hungry for this solution."

About Dialink

Dialink is a long distance company that serves customers nationwide and a local telephone company serving the San Francisco Bay Area. The company is headquartered in Mountain View, California, and can be reached at 800 896-3425.

About Netergy Networks

Formerly known as 8x8, Netergy Networks is a leading provider of highly integrated IP telephony solutions to telephone service providers and telecommunication equipment manufacturers. Netergy Networks' IP telephony solutions include network software and systems as well as embedded technology. The company is based in Santa Clara, California. For more information, visit Netergy Networks' web site at www.netergynet.com.