1. Efficient Networks

2. Agenda Service provider Problem/Issues Who we are, why are we here Focus on Increase ARPU –VPN and Firewall managed services Why an Efficient solution

3. About Efficient Networks ® Founded in 1993, based in Dallas, 400+ employees Worldwide leader in DSL routers –Delivering enterprise grade routing functionality for nearly 10 years –Leader in access technologies for small businesses (ADSL, SDSL, G.SHDSL, IDSL) April 2001: Efficient acquired by Siemens Siemens –Global Leader in Electrical Engineering and Electronics –Comprehensive Product Range – From mobile phones to power plants –153 Years Old –400,000 Employees in 190 Countries –Over 500 Manufacturing Locations –$75 Billion Sales Worldwide (FY99) –7 th Largest Private Employer Worldwide

4. A Quick Q/A dialogue Is increasing revenue per user a priority? Who has a security offering? –VPN? Firewall? Managed service? How much? Which equipment? Where do you see value added features? Not here to sell anything, Position value Save money, make money or improve situation

5. Service Provider Issues Commoditized DSL monthly costs –Build value around commoditized offering Customer retention –Retain longer if tied to a bundled solutions Increase revenue per user –Leverage existing network and truck rolls –Deliver managed services Perception of resource heavy rollout, complicated process

6. Solution Efficient networks 5851, 5871 and 5940 VPN and Firewall’s No network build-out, simple remote activation Leverage existing truck roll 1 box solution Highest level of security available (Ipsec/3DES) Zero dollar cost, immediate time to revenue

7. Numbers Average DSL monthly service = $139/mo 384k SDSL Charge $199 NRC VPN upgrade (143% +ARPU) –$0 dollar vpn key cost, minimal resources required Charge $39.95 MRC VPN (29% +ARPU)

8. Managed VPN Services The Efficient firewall may be managed remotely via Telnet or HTTP/WebGUI Who offers managed firewall services? –AT&T –Genuity –SBC –Qwest –Verizon –WorldCom –XO Sample offerings –XO $450-$750 setup, $200+ per month per router –AT&T $TBD setup, $600+ per month per tunnel –Virtela (including access) $TBD setup, $300-1,250 per month per site

9. Managed Firewall Services The Efficient firewall may be managed remotely via Telnet or HTTP/WebGUI Who offers managed firewall services? –AT&T –Genuity –SBC –Qwest –Verizon (through Activis) –WorldCom –XO Sample offerings –Remotefirewalls.com $225+ setup, $95+ per month per firewall –XO $250+ setup, $100+ per month per firewall –Enterprise level $1,375 (Genuity) - 2,500+ (AT&T) per month per firewall

10. VPN Gateway Interoperability IPSec Interoperable with: CheckPoint Cisco VPN Concentrators NetScreen Nortel Contivity & Shasta RedCreek SonicWall SafeNet VPN Client IDSL Efficient 5871 VPN Gateway Wireless Modem Efficient DSL Modem Cable Modem Ethernet Efficient 5781 ADSL Efficient 5861 SDSL Efficient 5851 SHDSL Efficient 5950

11. Explanation of VPN/FW on the routers 5800 series DSL routers –5.0 EOS –VPN is shipped with the routers, but is locked within the firmware. –A software key is required to unlock the VPN –VPN key is $199 through webstore –25% discount for reseller through distribution –Firewall is basic IP filtering and comes free 5940 T1 router –6.0 EOS next generation –VPN/3DES shipped with router free. For the VPN line speed acceleration, $199 for the software key –Basic firewall shipped with router free. ICSA Certified Stateful Firewall is $299 via s/w key to unlock Zero cost on 5940 (not 5800 series)

12. EOS 5.3 VPN Configuration

13. EOS 5.3 Firewall Configuration Note: Output created by pressing Apply

14. If a Truck roll is done, why not No second box, remote activation Create additional revenue streams by offering new services –VPN creation and management –Firewall security offering Wholesale to Zero Cost, immediate time to revenue Summary Increasing ARPU

15. Greg Imahara (408)357-6630 gimahara@efficient.com