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Chris McKie
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For Immediate Release

FORMER NETSCAPE, ISP CHANNEL, SHUGART AND XEROX EMPLOYEES JOIN FORCES TO LAUNCH NETMACHINES, INC. - A NEW DEVELOPER OF LINUX-CENTRIC, INTERNET & E-COMMERCE SOLUTONS

NETmachines, Inc., Makes Market Debut at ISPCON - Previews NETmachines RedRak Linux-Centric Server Appliances

SAN JOSE, October 26, 1999 - Leveraging a rich history steeped in Linux, Unix, networking and communications technologies, former Netscape, ISP Channel, Shugart, Silicon Graphics and Xerox employees have teamed up to launch a new, formidable force in the server appliance market. Privately held and well funded, the new company, NETmachines Inc., will unveil prototypes of their new Linux-centric server appliances at booth # 1543, Hall D at ISPCON, a major ISP trade show occurring this week in San Jose, California.

NETmachines Inc. designs and develops cost-effective, Linux-centric Internet and e-commerce appliance solutions. This week at ISPCON, NETmachines will show its first RedRak Linux-centric server appliances. Specifically designed for ISPs, RedRak thin-servers are positioned to be extremely flexible, affordable, manageable, powerful and reliable solutions. Additionally, RedRak servers are ideal for small to medium sized businesses that want to co-locate their Internet and e-commerce needs.

"NETmachines' vision is to provide ISPs, small and medium sized businesses and resellers that service vertical markets, such as education and healthcare with flexible, high-performance, and easy to manage, Linux-centric Internet and e-commerce solutions" said Peter Tsepeleff, president of NETmachines, Inc. "Given our expertise and deep understanding of this market, we designed and developed our RedRak solutions to offer mainframe reliance, security and performance, with the ease of use and affordability of a home PC."

NETmachines Teams Top Talent

The team that is launching NETmachines, Inc. knows the ISP market inside and out. Several of them are founders of highly successful companies, including: ISP Channel, which is the third largest cable Internet provider in the U.S., AutoTalk, TuneUp.com, and PipeLine Communications. Additionally, the team is seasoned from years of work with industry innovators, including: Netscape, Silicon Graphics, SoftNet, SmartLink, TeleVideo and Xerox.

The senior management team, headed by President and CEO, Peter Tsepeleff, contains other prominent Internet industry luminaries, including: CTO, Bob Evans; Vice President of Technical Operations, Rod Beckwith; and Vice President and CMO, Pat Dane. In reply to NETmachines' management team, Tsepeleff adds, "If this was football, we would have a SuperBowl dynasty."

RedRak Solutions - Ideal for ISPs, and Small & Medium Sized Businesses

NETmachines calculates that the total size of the thin-server market is $16 billion. A majority of this market is comprised of ISPs that thirst for more IT resources to meet their growing customer needs. Of these ISPs, NETmachines estimates that up to 44-percent use or will be using a Linux-based solution by 2000. Given the growth of Linux and explosive demand for Web hosting and e-commerce, NETmachines sees a large and mostly untapped market opportunity for their RedRak servers.

Designed for maximum flexibility, RedRak servers offer ISPs and businesses with a proven, reliable and non-proprietary design that is based on the Intel chipset architecture. RedRak thin-servers are rack-mountable or can be stacked; and given their low profile and footprint, RedRak servers can be placed almost anywhere.

Distinguished by their bright red color, RedRak servers deliver the full power of the Red Hattm OS. As well, RedRak servers are easy to set up, use and manage file/print servers, firewall, routing, Web hosting, FTP, e-mail and LDAP services. With an intuitive GUI, almost anyone will be able to set up and run a RedRak server within minutes of taking it out of the box.

Shipping in December 1999, entry-level RedRak servers will be available in the U.S. for an estimated street price of $999. Additional product specifications will be available at the time of their announcement. RedRak server solutions will be sold direct to ISPs, VARs, and small and medium sized businesses via NETmachines website, www.NETmachines.net.

Tsepeleff concludes, "The Linux thin-server market opens a new door of price, power and performance for all businesses. NETmachines is excited to be able to pull in a top-rated management team and jump into this market with innovative solutions that give ISPs and businesses the tools to be more productive and profitable."

About NETmachines, Inc.
NETmachines Inc. is a leading developer of Internet, e-commerce and Linux-centric appliance and communications solutions. NETmachines commands a rich Linux, networking and hardware expertise to forge their RedRak solutions that lead the industry with unparalleled performance, reliability, affordability and ease of use features. Headquartered in Palo Alto, California, NETmachines' RedRak solutions are sold direct to ISPs, small and medium sized businesses and resellers that service vertical markets such as education and healthcare.

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Editors' Note: More information about NETmachines, RedRak solutions, services and business partners is available on the World Wide Web at: (http://www.NETmachines.net)

NETmachines and RedRak are trademarks of NETmachines, Inc. All other products, brand names or companies are trademarks or registered trademarks of their respective companies.