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Nortel Networks and EPiCON Join Forces to Accelerate Application Hosting Services for the Small and Medium Business Market; Questions and Answers

excerpt from Business Wire

Q. What is the main topic of this announcement?

EPiCON, Inc. and Nortel Networks today announced a strategic alliance to create solutions for service providers to deliver application hosting services to small- and medium-sized business customers. Nortel Networks has invested $10 million in EPiCON, and the companies will work together to integrate EPiCON's software into Nortel Networks' campus and wide area network, network management, and application offers.

Q. What does EPiCON's technology do?

EPiCON develops software that allows companies to use the Internet to deploy and manage desktop applications and application components. Service providers such as Application Service Providers (ASPs), Competitive Local Exchange Carriers (CLECs), Regional Bell Operating Companies (RBOCs), and Value-Added Resellers (VARs) can target, deploy, install, update, "self-heal," and remove any type of desktop software -- from browsers and plug-ins to full office suites and enterprise-class ERP packages -- over the Internet through firewalls, as well as on LANs and WANs. The service provider can improve "Application Quality of Service" by insuring that desktop software is easily available, always at the right release, and always in working order. By automating the software deployment, self-healing, and management process, the service provider also can cost-effectively host many more applications and users.

Q. Why has Nortel Networks decided to form a strategic alliance with EPiCON?

Nortel Networks is leading the industry in providing integrated infrastructure, management, and application solutions for ASPs and other service providers, and in developing comprehensive network-based products and services for small- and medium-sized business customers. The EPiCON technology adds a critical desktop application management capability to Nortel Networks' solution sets. This functionality will strengthen Nortel Networks' service provider offers. It will also allow Nortel Networks' resellers to deliver advanced services to their customers and to generate additional services revenue.

Q. How will end customers, in particular small/medium businesses, benefit from this relationship?

Nortel Networks is enabling solutions that permit small and medium businesses to acquire their information technology infrastructure and applications from a single source, as a "service" rather than as "point products" from multiple sources. This frees customers to focus on their businesses rather than on acquiring, implementing and operating networks, computers, and software. EPiCON's technology will strengthen Nortel Networks' offerings by adding key application management services. Customers will be able to choose from a suite of turnkey applications and take advantage of higher reliability and availability.

Q. How will ASPs benefit from this relationship?

ASPs and other service providers will partner with VARs and consultants to design, deliver, and operate hosted application solutions to end customers. These new solutions from Nortel Networks and EPiCON will enable service providers to deploy and manage more applications, more reliably, at lower cost. These applications include the new wave of thin-client hosted applications plus the more traditional and pervasive thick-client applications, such as word processing, spreadsheet, and graphics packages.

Q. How will VARs and System Integrators (SIs) benefit from this relationship?

The integration of EPiCON desktop application management technology with Nortel Networks solutions enables VARs and SIs to add new value-added services to their portfolios. Customer desktop application services and management allows these channel partners to participate in the fast-growing solution provider market thus generating desirable recurring revenue for their businesses.

Q. Why is the emphasis on end-to-end management and hosting desktop applications and application components?

Some applications can be hosted in a "thin client" configuration, with relatively little processing on the desktop. However, ASPs can't provide reliable hosting services even for these web-based or "thin" applications if the end user can break or corrupt browsers, plug-ins, and networking clients that execute on the local PC. The vast majority of applications in use today are "thick client" applications that perform better if they execute locally. To host these applications, service providers need an efficient, cost effective means to deploy and manage the desktop components. If ASPs want to serve mobile workers from the network, they need a technology that installs and updates software on laptops and other systems that are used when not connected to a network. By combining EPiCON's technology with its other offerings, Nortel Networks allows service providers to cost-effectively host and support all types of applications, for all kinds of users, with a single management infrastructure.

Q. What are the specific elements of the strategic alliance?

Nortel Networks has made a $10 million equity investment in EPiCON. The companies are defining new co-developed solutions that utilize EPiCON software. The companies are conducting joint customer pilots. In addition, Nortel Networks and EPiCON will work together to promote Nortel Networks application management offers and to popularize their shared vision of building a new way for small and medium businesses to do business.

Q. When will the first products be available in the market?

EPiCON software has been ported successfully to several Nortel Networks' network hardware platforms, including the popular BayStack Instant Internet 400 access router. Joint field trials of a planned managed services offer begin next month, although no date for offer release has been established.

Q. What is the Nortel Networks Managed Application Services Initiative?

On December 13th, 1999, Nortel Networks announced its Managed Application Services Initiative, which will deliver pre-integrated, certified network application solutions to service providers. These solutions will include business and communications applications, which are network aware and enhanced with multimedia capabilities.

The initial announcement included three key solution areas: Managed Messaging in conjunction with HP and, Managed eCommerce leveraging Intershop's web storefront creation capabilities, and Managed Workplace eCommerce including travel and expense management, human resources self-service, and corporate procurement, with Concur Technologies.

Q. Did Nortel look at other companies besides EPiCON for this type of technology? Who competes with EPiCON?

Nortel Networks studied several technologies before determining that EPiCON had the most comprehensive software of this type and offered the most reliable managed desktop services. There are many companies, including Citrix, Tivoli, and Marimba, which offer portions of what EPiCON offers. In fact Nortel Networks uses software from other vendors for special purpose needs. However, EPiCON differentiates itself with an industry-leading self-healing technology which, in many cases, eliminates the need to call for service, maintains high application availability even when application files have been corrupted, and significantly reduces service provider support costs in terms of time and staff.


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