First New York Telco to Offer Video Over Copper with DHE Technology from VideoTele.com

LAKE OSWEGO, Ore., August 1, 2001 – VideoTele.com, Inc. (VT.c), a Tektronix company (NYSE: TEK) and the single source supplier for service providers deploying innovative home entertainment solutions via the broadband Internet, today announced that New York-based Delhi Telephone has been added to the ranks of telcos that are offering integrated voice, video and data services over existing Very high-speed Digital Subscriber Line (VDSL) technology. VideoTele.com's Digital Headend (DHE) solution is proving to be paramount technology to Delhi's video offering, which consists of 140 channels of premium-quality video and audio that are bundled with telephone services and high-speed Internet connectivity. Having successfully tested the package with customers in the vicinity, Delhi Telephone plans to officially offer the service in August. This offering places the phone company’s cable subsidiary, DTC Cable, Inc., in direct competition with AOL Time Warner (NYSE: AOL).

Today’s telephone companies are seeking to improve their competitive advantage by offering new high-growth, high-revenue services while reducing overhead costs. The approach enabled by DSL technology and headend equipment offers LECs and CLECs the opportunity to combine superior digital video offerings with voice and data services at less cost than the hybrid fiber-coax solutions typical of cable broadcasting. The technology’s architecture will enable Delhi to offer subscribers Interactive TV and Pay Per View channels in the future. With more telcos battling cable operators for the same consumer dollar, Delhi believes that DSL's switched network technology is a better medium for offering superior quality broadband services at a competitive rate.

Delhi selected VideoTele.com’s video offering as part of a strategic move to counter Time Warner's current package. Delhi kicked off its marketing efforts at the Delhi “Fair in the Square” community fair, July 27, 2001. There, potential subscribers had the opportunity to "test-drive" Delhi's offering and witness the three (3) simultaneous services: telephony, high-speed Internet connectivity and video. Services were delivered via gateways from Next Level Communications, a leading VDSL access vendor, and premium video services via VideoTele.com. Customers subscribed on site. Their current trial will serve 200 customers. Delhi is targeting between 500 to 700 homes for the initial turn up. Delhi anticipates passing 1100 homes by the end of August. Delhi also plans to upgrade the coaxial portion of its cable television (CATV) plant to the VDSL-based network architecture in the near future.

“We chose VideoTele.com because they were immediately capable of addressing our needs and it didn’t seem like anyone else in the business was,” said Steve Barker, Delhi Telephone Vice President/General Manager. “We needed a solution that would position us competitively with Time Warner’s high speed data services. The combined efforts of VideoTele.com and Next Level Communications provided that for us. Tried and tested, the digital video quality is superb.”

The VT.c DHE products convert analog video content and new digital video content into an MPEG-2 single program transport stream, encapsulating it in ATM packets for real-time streaming across a DSL network. The digital video is transported over fiber and distributed to the home through the VDSL-based distribution architecture via the twisted pair copper infrastructure. The video and audio feeds are received by the customer premise equipment for a complete end-to-end video solution that simultaneously delivers analog and digital broadcast-quality video channels, enhanced phone services and high-speed Internet services – all over a single connection.

"VideoTele.com is enabling Delhi Telephone to successfully compete against cable and DBS," said Douglas C. Shafer, Chief Executive Officer and President of VideoTele.com. "We are very excited to be working with proactive, forward thinking service providers, like Delhi Telephone, to not only protect their existing revenue base but also enable them to significantly expand their customer offerings and revenue potential." About the Companies

Delhi Telephone Company
Delhi Telephone Company is one of the nation’s original ILECs, established in 1897 by a local attorney, Stephen F. Adee. The Company is still family owned and managed today and serves 5,400 access lines in the Catskill Region of New York State, as well as providing cable television, Internet access, and a variety of business networking solutions. Its wholly owned cable television subsidiary, DTC Cable, Inc. was created in 1997. DTC Cable originally provided management services for locally owned cable television clubs in the small hamlets and villages in the telephone company’s territory. After purchasing some of the clubs, DTC Cable now serves over 500 television subscribers on older coaxial cable systems, and soon hopes to double their subscriber count by providing competitive digital video service in the Village of Delhi. To find out more about Delhi Telephone Company, visit their website at www.delhitel.com

VideoTele.com
VideoTele.com is the single source supplier of Digital Headend solutions enabling home entertainment delivery via the broadband Internet. Building on 20 years of experience in video over telecommunications networks, VideoTele.com assists broadband providers with innovative products, strategic consulting and premier performance in system design, deployment and support. VT.c’s Digital Headend solutions are used today at RBOCs, ILECs and CLECs, and VT.c is the number one provider of these products to Independent Operating Companies (IOCs). Headquartered in Lake Oswego, Oregon, VideoTele.com is a subsidiary of Tektronix, Inc. Additional information on the company can be found by accessing the VideoTele.com website at: http://www.videotele.com.