CS TELECOM and ZyXEL Partner to Promote New Generation DLC in Taiwan and Mainland China

Hsinchu, Taiwan, July 17, 2000 - CS TELECOM, the leading European carrier access and corporate network manufacturer, and ZyXEL Communications, a leading innovator and provider of integrated Digital Subscriber Line (DSL) customer premises equipment (CPE), announced today their partnership to market a Multimedia Local Loop solution in Taiwan and Mainland China. Under this agreement, ZyXEL will market CS TELECOM's SafeCom 8000 with its full line of xDSL CPE solutions, offering integrated broadband services to the fast growing fixed network market.

The Taiwan market for fast Internet services is growing at a tremendous pace, and Taiwan currently ranks as the world's third largest market for ADSL services after the USA and Korea. In addition to the incumbent carrier, ChungHwa Telecom, three competitive carriers own a Network Service Provider license in Taiwan. More than 1 million ADSL accesses should be deployed in Taiwan by the year 2004. Also, according to studies, the number of voice lines using packet networks in Taiwan is seen swelling from 18,000 to 140,000 between 2000 and 2003.

CS TELECOM and ZyXEL's partnership already won their first tender a few weeks ago for the Taiwanese incumbent carrier ChungHwa Telecom: CS TELECOM's SafeCom 8000 has been selected as the best-suited DSL Access Multiplexer for ADSL, ISDN and POTS services. "We are very excited to partner with ZyXEL. Our Multimedia Local Loop (MLL) solution fits the Asian market very well, especially in Taiwan where the concept of New Generation DLC, which is what MLL is all about, is getting more and more attention" said Djamel Chekroun, General Manager of CS TELECOM.

"As the backbone infrastructure is changing to broadband swiftly, CS TELECOM's MLL solution delivers integrated narrowband and broadband services to meet carriers's critical needs," said Shin-Jou Fang, President of ZyXEL. "We are pleased to forge this new relationship with the industry's network system leader, as its solid MLL solution together with ZyXEL's complete CPE product line will extend our reach into the incumbent carrier market, enabling a complete Internet access businesses."

About CS TELECOM Multimedia Local Loop (MLL)
CS TELECOM's Multimedia Local Loop (MLL) is built mainly around two key products: SafeCom 8000 and SafeCom 9000. SafeCom 8000 is a Multiservice Access Platform designed to give network providers a complete access solution enabling high value-added Narrowband and Broadband services while offering maximum flexibility. SafeCom 9000 is a high-speed distribution system based on ATM PON technology (Passive Optical Network) following FSAN standard (Full Service Access Network) and enables customers to be connected to the operator's optical backbone network. SafeCom 9000 provides high-speed services ATM-155 Mbit/s and E1-2 Mbit/s for corporate customer bases and is used to connect the SC8000 access multiplexers in the field.

About ZyXEL Communications
ZyXEL Communications Co. (TAI:2391.TW), located in Hsinchu, Taiwan, is a leading supplier of complete networking access solutions for Internet / Intranet/VPN/Extranet applications. Products developed by ZyXEL over the years are not only industry leaders, but consistently win acclaim and are selected by worldwide telecommunications companies, ISPs, and other major businesses. ZyXEL now serves France Telecom (NYSE:FTE), EarthLink (NASDAQ: ELNK), Bell Atlantic (NYSE: BEL), Verio (Nasdaq: VRIO), Telia, Telecom Italia (NYSE:TI), Czech Telecom, Chunghwa Telecom, China Telecom, Korea Telecom, and Cuba Telecom. For more information on ZyXEL Communications, visit company's Website at http://www.zyxel.com.

About CS TELECOM (http://www.cstelecom.com)
CS TELECOM is a subsidiary of the CS Communication & Systemes Group, a major network system vendor, system integrator and service company for the telecommunications industry. CS TELECOM is leading the European market for access switches and concentration systems in the area of IP and ATM.

The CS TELECOM's Multimedia Intranet offering provides modular, high-performance multi-service and multi-protocol solutions for central sites and branches in multi-site businesses of all sizes. SafeCom solutions can transport multiple flows (voice, data and video) over a single network whilst tailoring Quality of Service (QoS) to each specific application.

The CS TELECOM's Multimedia Local Loop offering is an efficient and multi-service solution. Its flexibility enables access to broadband value-added services including IP, ATM, xDSL and telephony services. This offer allows Quality of Service to be allocated on a per-user basis and will transport Voice over IP (VoIP) in the local loop.

The CS TELECOM's Universal Local Loop solution takes profit of expertise and skills in both fields and integrates both offerings for new services (VoDSL, Video on Demand, etc.).

As an international company, CS TELECOM has built more than 500 enterprise Wide Area Networks, and presently provides access and edge systems to more than 50 operators and network service providers worldwide. These networks are operational all around the world (Latin America, South Africa, European Union, Eastern Europe, Middle East, Asia, etc.) with a prominent presence in the banking, finance, government and public services markets.