Next Level, Myrio and Kasenna Deliver VOD Solution for Telephone Companies

Utah Telco Uses Next Level Equipment to Deliver Video-on-Demand Content over Phone Lines

ROHNERT PARK, Calif. - Next Level Communications’ (Nasdaq: NXTV) Full Service Access Platform, the most widely deployed “Telco TV” equipment in the world, now gives telephone companies the ability to participate in the rapidly emerging video-on-demand (VOD) market. The Next Level solution is commercially available, and is currently providing VOD services to subscribers at All West Communications in Kamas, UT. Next Level and its partners successfully demonstrated the VOD solution at All West in December to 15 potential telco customers. Next Level will also demonstrate the solution in its booth (#527) at the NTCA conference, Feb. 4 through Feb. 6 in Phoenix.

“VOD is a tremendous revenue opportunity and a ‘must have’ addition to our broadcast TV services to beat our cable competition,” said Tony DiStefano, general manager of All West and a longtime Next Level customer. “There has been a lot of confusion in the market about VOD, but make no mistake, customers want it very badly. With this VOD solution, Next Level and its partners are again raising the bar and keeping us ahead of the cable and satellite guys—the same people that our customers had formerly thought of as premier entertainment providers.”

VOD services are a natural extension of the Next Level Full Service Access Platform and are tailor-made for telecommunications networks. The global telecommunications infrastructure was built from the ground up with dedicated bandwidth and inherent two-way capabilities. Unlike cable, which was developed as a one-way broadcast medium, telephone networks were originally designed to manage large amounts of data, both “downstream”(from sender to receiver) and “upstream” (from receiver to sender). Thus VOD, an interactive service that requires the ability to manage large amounts of dedicated bandwidth in immediate response to viewer requests, is better suited for delivery over telephone networks than cable networks. U.S. cable operators have already spent over $65 billion to upgrade their facilities to provide digital and two-way services like cable telephony, high-speed Internet, digital TV and VOD services. However, to support the bandwidth demands of even moderate VOD success, billions of additional dollars will have to be spent to transform cable networks to match the interactive capabilities inherent to the telecommunications infrastructure. As for satellite service providers, real-time interactive capabilities are virtually impossible.

“Video-on-demand will be a significant revenue opportunity for all service providers," said Michelle Abraham, senior analyst, converging markets and technologies for In-Stat/MDR. "This combined solution from Next Level, Myrio and Kasenna brings together the capabilities of two-way bandwidth and proven ability to combine video, voice and data services in a package that telco subscribers will find extremely appealing."

“Video-on-demand is a critical piece of the service bundle from any telephone company that wishes to compete head-to-head with cable,” said J. Michael Norris, chief executive officer of Next Level Communications. “The consumer demand for the service is strong, and cable companies are only now beginning to commercially deploy it. Myrio, Kasenna and Next Level have made it possible for telcos to deliver VOD today over their existing networks, complementing a service bundle that includes 100 percent digital TV, high-speed Internet, phone services, and unique features like onscreen caller-ID and message waiting. Telcos are engaged in a battle for broadband supremacy, and we’ve enabled them to deliver a package of services that no cable company can touch.”

“We have been commercially deploying VOD with Myrio Interactive, our IPTV product, since 2000,” added Chris Coles, president and CEO of Myrio Corporation. “The new solution with NLC and Kasenna is exciting because it marks the first time the Myrio VOD offering has been integrated into another turnkey solution. It also illustrates the flexibility of our solution to integrate with multiple platforms, and to provide more deployment options for broadband service providers.”

“Our open architecture makes it faster and easier to integrate with any hardware platform or software application for efficient VOD deployments tailored to market demands,” said Mark Gray, chief executive officer of Kasenna. “While capitalizing on legacy infrastructure and networks, our field-proven technology allows service providers to scale cost-effectively as demand grows. Service providers can also choose to deploy their VOD services, or migrate to EOD services, on either a centralized or decentralized architecture.”

About Next Level Communications

Next Level is a world leader in integrated broadband access platforms for delivering any combination of voice, high-speed data and multi-stream digital video services into the home or office. Next Level offers a unified multi-service, multi-band platform that lets communications service providers enter a more profitable broadband market segment by delivering a virtual communications and entertainment center over existing copper telephone lines. Next Level's highly scalable networking products, management tools and support assistance allow communications service providers to deliver a range of subscriber services, and realize significant new revenue streams. Founded in 1994 and headquartered in Rohnert Park, Calif., the company has deployed its state-of-the-art systems for more than 100 communications service providers worldwide. For additional information, visit http://www.nlc.com.

About Kasenna, Inc.

Kasenna, Inc. delivers broadband infrastructure software that enables network service providers, content providers and enterprises to build commercial-grade video-on-demand networks and applications for delivering entertainment-quality video. Built on technology spun out of SGI, over 2300 deployments worldwide use the company's video on demand software. Kasenna’s award-winning technology is available on the IRIX, Solaris, and Linux operating systems. Kasenna, pronounced [kah-SEN-ah], is headquartered in Mountain View, California. Together with Apple, Cisco, IBM, Philips and Sun, Kasenna is a founding member of the Internet Streaming Media Alliance. For more information, go to www.kasenna.com.

About Myrio

Myrio is the leading provider of software and integration services that enable new video revenue opportunities for broadband service providers by leveraging their existing infrastructures. With Myrio's solutions, operators can offer next generation, TV-based services and media to their customers. In turn, operators can protect their valuable residential assets from competitors, such as cable and satellite companies. A pioneer in the industry, Myrio has commercially deployed its solutions to operators throughout the United States, and is conducting customer trials internationally as well.

Myrio is a privately held corporation funded by Ridgewood Capital,NeoCarta Ventures, and Alexander Hutton Venture Partners. For more information, please visit Myrio's web site atwww.myrio.com.