LONDON, UK - May, 17, 2000 - COLT Telecom Group plc (COLT), one of Europe's leading providers of high bandwidth data, internet and voice services to business customers and Cisco Systems Inc., the world wide leader in networking for the internet said today they plan to take their existing commercial relationship to the next level. They will also develop a business and marketing partnership which will incorporate new and innovative IP-based solutions for business customers across Europe.

COLT will work with Cisco as its preferred IP equipment supplier to develop applications for new business areas, leveraging Cisco's ecosystem(i) to address systems integration, support and network management. COLT will gain access to Cisco's leading IP technologies for voice and data convergence, world wide IP-VPN services, web hosting, application service enabling capabilities, e-commerce solutions and Internet billing, based on a Cisco Powered Network platform(ii).

In addition COLT and Cisco will work together on joint marketing efforts to accelerate the design and execution of new IP services, leveraging programs such as JOLT(iii), Jumpstart(iv) and the service consulting solutions necessary to facilitate a rapid time-to market for differentiated services addressing specific projects.

Paul Chisholm, COLT President and CEO said: "This agreement builds on the strengths of COLT's optical network infrastructure across Europe and its leadership position in the provision of high quality, high bandwidth data and internet and voice services to business customers. Working with Cisco Systems, we are further strengthening our position as a provider of leading edge IP/data services over our pan-European network."

Bill Nuti, President of Cisco Systems EMEA said: "The alliance with COLT is an excellent opportunity to leverage the business needs of European companies as they seek to take advantage of the benefits of value added IP Services that will drive the transition to the Internet Economy. Cisco is very pleased to be working with COLT on converged voice and data solutions. Together we will embrace the tremendous opportunities that exist in Europe today, and leverage Cisco's experience in providing the next phase of New World services with COLT's reputation for excellent customer service."

One of the first projects under the agreement will see COLT and Cisco develop COLT's IP City project in Stockholm, which will deliver IP services alongside existing voice and data services.