Allayer Strengthens Management Team;
Adds Senior Operations Executive

SAN JOSE, Calif., July 21, 1998 -- Allayer Communications today announced a major addition to the senior staff of the company. "I am very happy to announce that Mr. James Ou has joined Allayer as Vice President of Operations," says Dr. Cheng-chung Shih, President and founder of Allayer Communications. "As we make the transition from an engineering-intensive organization to a high-volume producer of 100/10 Mbps Fast Ethernet and 1 Gpbs Gigabit Ethernet switching ICs, Mr. Ou's expertise will be invaluable. He has direct experience in managing local and off-shore resources and vendor relationships in an intense, high-volume market environment. These skills are key to Allayer's future success."

Mr. Ou (pronounced "Oh"), has served in a number of senior manufacturing and operations management positions. Most recently, he has served as a consultant to Silicon Valley venture capital funds performing due diligence analysis of mezzanine-round startups. In this role, he was instrumental in evaluating the strengths and weaknesses of startup semiconductor companies. During the past six months, he worked with Allayer as a consultant and was a key contributor in the development of the current operational plan for the company.

From 1988 to 1993, Mr. Ou served as Director of Operations at Oak Technology, Inc. where he was responsible for that firm's fabless semiconductor operations. During this time, he helped grow Oak Technology from just a startup to over $100 million in revenue and set the stage for a subsequent and successful IPO. At Oak, he excelled in managing complex vendor relationships with high volume domestic and international manufacturers, assembly and test houses and other service providers.

"Allayer is a unique opportunity," says Mr. Ou. "As a veteran of several semiconductor startups, I know that it takes a special combination of talent, leadership, and hard work to transform a small engineering-focused company to a respected high volume supplier. Allayer has that special something. I was very impressed with their engineering talent, top management's drive to succeed, and with Allayer's choice of target markets -- the fast growing high performance network switching IC market. My focus will be in vendor and resource management so we can provide a high volume flow of high quality product."

Adds Dr. Phil Mak, General Partner of VenGlobal Capital, "In the past year, Allayer has performed excellently in developing hot new products for the networking market. Now, it must execute in delivering high quality products at an affordable price. For startups at this stage, execution is the key which separates the winners from the losers. This is where Mr. Ou will be a major contributor. He is well-known and respected throughout the industry and is generally considered one of the pioneers in developing fabless semiconductor company operations. His skills will be essential in moving Allayer to the next stage of their corporate development."

At Allayer, Mr. Ou will be responsible for all phases of product engineering, manufacturing operations, quality assurance, customer service and accounting. Mr. Ou will report to Dr. Cheng-chung Shih, President and CEO of Allayer.

About Allayer

Allayer Communications was founded in 1997 to design, manufacture, market and support semiconductor solutions for high performance network systems. The company provides solutions that give the systems manufacturer advantages in system design flexibility, scalability and cost. Its first product, the AL100 Fast Ethernet Switch IC, enables networking systems OEMs to produce higher performance 100 Mbps Fast Ethernet switches at lower cost. Its latest introduction, the AL1000 Gigabit Ethernet Switch IC, brings the same cost and performance advantages to the ultra high speed Gigabit Ethernet switch market.

Allayer resources include important technical and management skills such as expertise in mixed-signal analog/digital semiconductors, bipolar and CMOS technologies, Ethernet and Fiber Optic communications, and network switching systems. The company uses a system solution methodology, rather than a IC-oriented one. Allayer is backed by over $5.5 million in venture funding from Acer Capital America, VenGlobal Capital and others.

The company is headquartered in San Jose, Calif.

Company Contact: Dr. Cheng-chung Shih (408) 570-0888 x101 Allayer Communications

Editorial Contact: Curtis Panasuk (650) 594-4800 Curtis & Associates