SOURCE: Cistera Networks, Inc.

February 02, 2007 07:00 ET

Cistera Networks Posts Strong Quarter

Revenues Up Sharply, Despite New Revenue Recognition Policy

DALLAS, TX -- (MARKET WIRE) -- February 2, 2007 -- Cistera Networks (OTCBB: CNWT), a leading provider of enterprise application platforms and engines for IP Communications, announced today that the company achieved strong quarterly performance in the most recent quarter ending December 31, 2006, despite instituting a new, more conservative revenue recognition policy. The company reported revenues of $635,323 for the quarter. This represented year-over-year growth for the quarter of 92% and quarter-over-quarter growth of 58%.

In an effort to establish an accounting policy that provides shareholders with the most accurate representation of the company's performance, the company has instated a new policy that only declares revenue from software, hardware and services once fully installed and implemented. This method of revenue reporting will not reflect all orders received and shipped during the reporting period, but only those orders received, shipped and completely installed within the reporting period. For instance, when calculated according to the previous reporting policy, revenues for this quarter would have been $844,204.

In future earnings reporting, the company will continue to provide the "booked" revenue figures -- the amount based upon Purchase Orders (POs) received from customers and delivered to resellers -- during the reporting period in addition to the new recognized revenue reporting policy.

"We have spent the last few years laying the groundwork to properly position the company to address the rapidly growing IP-based Computer-Telephony Integration market that the Telecommunications Industry Association forecasts to be over $12 billion by 2010," stated Derek P. Downs, President and CEO of Cistera. "We believe the market is at its inflection point as we have seen demand increase significantly for our products and services over the past months. We are aggressively ramping up sales and marketing efforts to take advantage of this opportunity.

"We have used the past several years to build the most robust IP-based Applications Platform in the industry knowing that once the market begins to ramp up, we would be the only company capable of supporting the deployment requirements of large enterprise customers," commented Gregory T. Royal, Cistera's founder and CTO. "Over the past six months, we have seen our large customers move from small pilot deployments, to planning for the full rollouts across their entire organization. This is where all of our hard work will start to pay off."

The CisteraConvergenceServer (CCS), with its robust suite of application engines, offers comprehensive solutions sets for vertical markets including Financial Services, Education, Government and Healthcare that deliver the functionality to enhance productivity and extend the capabilities of the IP Communications network. The CCS adds critical competency and features such as text and audio broadcasting, messaging, recording and content streaming within a Cisco Communications environment. Cistera has platforms that support 100 to 100,000 users.

About: Cistera Networks

Cistera Networks makes Application Driven Telephony a reality by setting the new standard in advanced IP phone application platforms and engines for IP Communications environments. The Cistera ConvergenceServer™ (CCS) uses the successful Cistera Enterprise Platform for IP Communications to provide Unified Application Administration and Fault and Performance Management for successful IP Communications Application deployments. Cistera provides advanced technology for numerous vertical markets including education, finance, healthcare and government. Cistera Networks maximizes IP phone intelligence -- taking it to an entirely new level.

This release may be deemed to contain forward-looking statements that are subject to the safe harbor provisions of the Private Litigation Reform Act of 1995. These forward-looking statements include, among other things, statements regarding future events and the future financial performance of Cistera Networks that involve risks and uncertainties. Readers are cautioned that these forward-looking statements are only predictions and may differ materially from actual future events or results. Readers are referred to the documents filed by Cistera Networks with the SEC, specifically the most recent reports on Form 10-K and 10-Q, each as it may be amended from time to time, which identify important risk factors that could cause actual results to differ from those contained in the forward-looking statements.

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