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Morgan Stanley Report Cites XDM™ As Best Converged Metro Optical DWDM and Next-Gen SONET/SDH Product on Market Today

PETAH TIKVA, ISRAEL, January 30, 2002 - Lightscape Networks, an ECI Telecom company (ECI Telecom: NASDAQ:ECIL) and international leader in optical networking, today announced that it has shipped close to 1,000 elements of the XDM hybrid optical networking platform to customers worldwide. Since the beginning of 2001, Lightscape Networks has added several significant customers, including Cable & Wireless, Globe Telecom, Moscow City Telephone Network (MGTS), D2 Vodafone and ntl to its growing roster of clients deploying the XDM. The company’s most recent customer win, Telia International Carrier, marks a major deployment of the XDM in U.S. Metropolitan Area Networks.

Further highlighting the XDM's success and market penetration, a January 2002 Morgan Stanley report cited Lightscape Networks' XDM metro optical platform as the "finest converged product" in the metro DWDM and next-generation SONET/SDH market. The report, titled "The Metro Optical Report: The Return of the RBOCs," examined products from all major optical vendors worldwide. Among other findings, the report concluded that next-generation SONET and metro DWDM equipment will converge as transport and service layers unify, allowing carriers to deploy the most cost-effective solution while eliminating complex network management systems, expensive optical interfaces and unnecessary network elements.

“Lightscape Networks has developed a product that integrates a powerful SONET/SDH switching fabric with multi-wavelength capability,” said David Jackson, optical networking systems and components analyst for Morgan Stanley.

The XDM’s pioneering single architecture approach converges intelligent metro/regional DWDM optical networking capabilities, multiple SONET/SDH rings, digital cross connects (DXC), carrier-class Gigabit Ethernet and on-demand network provisioning within a single device. The XDM's unique “Build-as-you-GrowTM” architecture allows service providers to expand their networks gradually and steadily according to customer bandwidth and service demands. With this approach, carriers can utilise the various technologies and features of the XDM that their network requires while allowing them to make a smooth, in-service transition to alternate network topologies and services in a cost-effective manner.

“Last year’s tremendous growth in XDM sales and global customer deployments in such a competitive market shows that we are bucking the industry trend and highlights the fact that we have the most advanced and flexible metro solutions available today,” said Ido Gur, vice president of marketing, Lightscape Networks. “Today’s carriers are looking for an experienced company to meet their network needs and a product that can cost-effectively grow with their network to meet increased bandwidth and service demands. Lightscape Networks is now in extensive field trials with the major incumbent operators worldwide. We look forward to continuing our penetration of the North American, European and Asian markets throughout 2002.

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About Lightscape Networks

Lightscape Networks is a leading provider of next generation intelligent optical networking solutions. Leveraging more than 10 years of global experience, Lightscape Networks offers advanced optical platforms that combine instant provisioning with on-demand network scalability. The company’s highly dense, multi-service XDM is used by carriers to build flexible network topologies that cost-effectively scale to future demands. Lightscape Networks’ solutions are deployed in 45 countries worldwide and serve both major carriers and emerging service providers at all stages of optical network implementation. The company has corporate headquarters in Petah Tikva, Israel and regional offices across Europe and Asia Pacific. In the USA the regional headquarters are in Herndon, VA. Lightscape Networks is a wholly owned subsidiary of ECI Telecom Ltd.

For more information on Lightscape Networks, please visit

About ECI Telecom

ECI Telecom Ltd. is a provider of integrated network solutions for digital communications and data transmission systems. The Company designs, manufactures, markets and supports end-to-end digital telecommunications for today’s new services and converging networks. The Company’s products create bandwidth, maximise revenues for network operators, expand capacity, improve performance and enable new revenue-producing services. In doing so, they enhance the capabilities of existing networks to support voice, data, video and multimedia services. ECI Telecom’s equipment supports traffic in more than 500 service networks in over 145 countries.

Certain statements contained in this release may contain forward-looking information with respect to plans, projections or future performance of the Company. By their nature, forward-looking statements involve certain risks and uncertainties including, but not limited to, product and market acceptance risks, the impact of competitive pricing, product development, commercialisation and technological difficulties and other risks detailed in the Company’s filings with the Securities and Exchange Commission.

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