Agere Systems and Ericsson to Develop Public Wireless Networking Solutions For Laptops and Handheld Devices

New Technology Will Enable Service Providers to Offer Convenient, Secure Wireless Network Access in Public Areas

ALLENTOWN, Pa., Oct 24, 2002 - Agere Systems (NYSE: AGR.A, AGR.B) and Ericsson (Nasdaq: ERICY) today announced plans to deliver technology that will significantly expand service providers' ability to provide laptops and handheld devices with access to the Internet and corporate networks from public spaces. The two companies will provide complementary 802.11/Wi-Fi solutions that connect to service providers' network hubs to enable user authentication and billing, a key step toward offering mobile users the freedom of roaming network access. The solution will use SIM (subscriber identification module) technology similar to what GSM phones use today.




Using the SIM technology, laptop users could simply log onto their company's network while waiting for a commuter train without plugging into the data port of a public telephone or providing credit card information. The combination of 802.11/Wi-Fi and SIM technology also enables roaming between service providers, ensuring broader network access for PC users on the move. By offering high-speed data access to mobile PC users, service providers can leverage the world's largest mobile customer base to supply data intensive services such as electronic mail, virtual meetings and web surfing. Ericsson's Mobile Operator WLAN solution is focused on helping operators to integrate wireless LAN with their existing 2G and 3G mobile business, as well as reusing investments made in subscriber management, billing and authentication.

"Together with Ericsson, we will clear the last hurdle to enabling widespread deployment of Wi-Fi networks in public spaces," said Ron Torten, vice president of Agere's Networking and Entertainment Division. "Whether you're stuck in an airport or preparing a customer presentation in a hotel or cafe, easy access to your information is only a couple of key strokes away."

This collaboration brings together two wireless leaders that are gaining access to new technology and new markets to significantly strengthen their competitive positions and better meet customer needs. Agere has more than a decade of experience in the development of high-performance, low-cost Wi-Fi chips, cards and modules, while Ericsson, the global market leader in wireless infrastructure, brings extensive knowledge from working with the world's leading mobile operators.

As part of this collaboration, Agere will supply 802.11b modules, software, and SIM technology for a solution that Ericsson will offer to service providers for the growing wireless networking market. Cahners In-Stat, an industry analyst firm, estimates that the total number of mobile PCs shipped with wireless LAN capabilities will increase from 18 percent today to 76 percent in 2006.

Along with leading-edge Wi-Fi technology, the package Agere plans to develop includes authentication software compliant with the SIM Extensible Authentication Protocol for GSM and the Authentication and Key Agreement (AKA) protocol for UMTS networks. Support of these two protocols allows network operators to provide the same security and billing services used in existing and next-generation wireless networks. Agere expects to begin delivering Wi- Fi(TM) products with SIM technology in the first half of 2003.

Agere's Wi-Fi modules, which consist of a media access controller (MAC), digital signal processor (DSP), and a fully integrated direct-down conversion radio, are designed to address the growing demand for high-volume, low-cost Wi-Fi technology in emerging applications. Agere's modules have been incorporated into the current products of all of the top PC makers.

Agere Systems is a premier provider of advanced integrated circuit (IC) solutions that access, move and store network information. Agere's IC solutions form the building blocks for a broad range of communications and computing applications. The company is the leader in providing storage solutions for hard disk drives with its read-channel chips, preamplifiers and system-on-a-chip solutions, and the No. 2 provider of Wi-Fi solutions for wireless LAN applications. For network equipment providers, Agere is a leading supplier of ICs for wired communications, network switching and access, and ATM and SONET/SDH solutions. In addition, Agere is the No. 2 supplier of application-specific ICs (ASICs) for communications applications. More information about Agere Systems is available from its Web site at http://www.agere.com.

Wi-Fi is a trademark of the Wi-Fi Alliance.

This release contains forward-looking statements based on information available to Agere as of the date hereof. Agere's actual results could differ materially from the results stated or implied by such forward-looking statements due to a number of risks and uncertainties. These risks and uncertainties include, but are not limited to, customer demand for our products and services, control of costs and expenses, timely completion of employment reductions and other restructuring and consolidation activities, price and product competition, keeping pace with technological change, dependence on new product development, reliance on major customers and suppliers, availability of manufacturing capacity, components and materials, general industry and market conditions and general domestic and international economic conditions including interest rate and currency exchange rate fluctuations. For a further discussion of these and other risks and uncertainties, see our annual report on Form 10-K for the fiscal year ended September 30, 2001, and report on Form 10-Q for the period ending June 30, 2002. Agere disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

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