SAN JOSE, Calif., January 27, 2003 - Cisco Systems, Inc. (NASDAQ: CSCO), announced today a complete Internet Protocol (IP) Communications program for mid-market (50- to 1000-employee) companies that want to benefit from the improved productivity and cost savings associated with a converged IP voice, video and data network. Building on its long-time leadership in IP Communications (IPC), the company today introduced enhanced solutions, packages, pricing, and financing for mid-market businesses, as well as education, training and marketing tools for its channel partners.

"Our mid-market customers want advanced IP solutions that deliver higher productivity and lower operating costs, as well as a growth and migration path to a converged voice and data communications network," said Bruce Laird, vice president and general manager of the Integrated Communication group at Cisco. "But they also tend to have small IT staffs and rely heavily on resellers and integrators as trusted advisers and business partners. The Cisco IPC program for the mid-market provides both solutions that are best-suited for medium-sized companies and the educated, experienced partners they need."

"Last October Cisco announced its small and medium business strategy, focused on delivering Cisco expertise, solutions, and brand to our fast growing small and medium business customers with an emphasis on the new networking technologies of mobility, security and IP Communications," said Peter Alexander, vice president, marketing, worldwide commercial market segment. "Today we are announcing the first part of the IPC strategy, which is intended to help SMB customers utilize networking solutions to improve the success of their business and help our partners shorten their sales cycle and increase profitability."

Products and Technology Provide Flexibility, Cost Savings

Cisco today announced new features for the Cisco ICS 7750, an advanced IP private branch exchange (PBX) chassis-based system for medium-sized companies and branch offices, which implements integrated voice gateway routing, call processing and business communications applications such as unified messaging.

The Cisco ICS 7750 now supports integrated Cisco Unity Unified Messaging 4.0, which enables users to manage their voicemail, e-mail and fax from a single device for increased flexibility. It also supports Cisco Customer Response Solution Software 3.0, a single server platform that reduces business costs and improves customer response for small to mid-sized contact center organizations leading to greater customer satisfaction. In addition, Cisco has doubled the product's analog- and digital-trunking capacities to lower the total cost per port.

"With the latest version of the Cisco ICS 7750, NetTeks is able to offer our customers a solid integrated communications system with all the functionality of a traditional PBX plus all the benefits of a converged IP solution at a price that is accessible to smaller companies," said Ethan Simmons, partner, NetTeks, a Cisco Premier Partner.

Cisco also introduced new and enhanced Cisco ICS 7750 voice packages that allow mid-market customers to deploy a small-site IPC system, to easily follow a data-ready migration path to a converged network, and to grow to a multiple-site network, if required. These solutions provide easy-to-order options in a cost-effective package.

"Mid-market business customers value simplicity," said Helen Chan, senior analyst, Small and Medium Business Technologies, the Yankee Group. "It is important that core IPC features are sold in a way that makes it easy for mid-market businesses to understand and buy. Cisco is doing just that with the rollout of its new voice packages. This not only helps to simplify the end-users' buying process but also empowers its channel partners to sell more adeptly."

The new Cisco ICS 7750-EV Voice (digital E1 public switched telephone network [PSTN] trunking) and the Cisco ICS 7750-BV Voice (ISDN Basic Rate Interface [BRI] PSTN trunking) packages meet the requirements of global markets. These new packages join the enhanced versions of the Cisco ICS 7750-M1V (analog PSTN trunking) and the Cisco ICS 7750-TV (digital PSTN trunking) packages. Each package includes the latest version of Cisco CallManager, Cisco Unity Voice Messaging and Cisco Auto Attendant. Each package can be upgraded to support up to 500 users and a full suite of applications. The entry-level price for the Cisco ICS 7750 voice packages is now $14,995.

For companies choosing a centralized call management design, Survivable Remote Site Telephony (SRST) is an industry unique and industry first capability to provide cost effective remote site redundancy for IP telephony. With release 2.1, SRST adds additional international language support for Italian, Spanish, German, and French. In addition, Cisco has announced new voice-package pricing for the Cisco 1700 and 2600 series platforms. The Cisco 1760-V-SRST is $2,995, and the Cisco 2651XM-V-SRST is now $6,595.

The Cisco 2651XM-V voice package is also newly priced at $5995. This package and the 1760-V package, priced at $2995, provide a cost-effective solution for sites with a local call management design.

To complete its IPC mid-market solution, Cisco recently announced the Cisco IP Phone 7905G, which supports a core set of business functions and has been priced for IPC adoption by smaller companies. The Cisco Catalyst. 3550 24 PWR intelligent Ethernet switch, with in-line power, was also introduced in November and is priced at $3495.

New Programs Can Help Cisco Channel Partners Increase Sales, Customer Satisfaction

Cisco is also introducing today several educational, marketing, training and financing programs to help its channel partners to be trusted IPC advisers and to shorten their own sales cycles.

Throughout the next six months, Cisco will make SMB solutions content available that will enable the Channel to engage in more strategic and consultative interactions with customers. The solutions, consisting of IPC, security and mobility, will include materials such as network blueprints, case studies, road maps and how-to-sell and why-to-buy presentations. Tools will be delivered in packages targeted at companies with 100 and fewer employees, 100-500 employees and over 500 employees. For more information, go to www.cisco.com/go/cibrchannel.

Cisco also announced today the addition of the Cisco ICS 7750 Installation and Configuration Remote Lab to the existing set of IPC remote learning tools. The course is a Web-based training program that teaches the configuration, installation and maintenance of the Cisco ICS 7750 and is linked to Cisco specializations and certification programs. The e-learning course is $195 and the remote lab is $300.

Also new today from Cisco is the IP Communications Financing program, a flexible five-year Cisco Systems Capital. Operating Lease for Cisco IP Communications solutions, that gives companies a way to begin implementing IPC solutions with a minimized investment that fits constrained budgets.

"The combined Cisco technology and Cisco Systems Capital financial solution benefits the mid-market customer by providing affordable IP Communications technologies. Together, we are delivering end-to-end IP Communications solutions that provide customers a competitive advantage in today's difficult business environment without stretching their IT budgets," said David Rogan, general manager, Cisco Systems Capital. For more information, go to www.cisco.com/go/ciscocapital.

Contact Information:
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Carrie Hoffman	Cisco Systems, Inc.	408 527-7505	cahoffma@cisco.com
Investor Relations Contact(s)
Roberta De Tata	Cisco Systems, Inc.	408 527-6388	rdetata@cisco.com