Technology Advancements to Shift Industry Pricing Structure and Marketing Programs to Fuel Channel Sales Growth

SARASOTA, Fla., May 30 /PRNewswire-FirstCall/ -- Comdial Corporation (BULLETIN BOARD: CMDZ) , a leading provider of traditional and IP Telephony solutions for small and medium-sized enterprises, recently demonstrated new products and technology and announced new marketing programs to its top 100 channel partners at the company's highly successful "Thrive Not Just Survive" Summit 2003 conference held in Captiva, Florida, May 18 - 20. Summit 2003 attracted Comdial channel partners from all over North America and Canada. "The attendance levels exceeded our original expectations," said Mark Lindsay, Comdial's vice president of marketing. Summit 2003 showcased Comdial's converged SIP communications platform, next- generation LAN telephony technology, a streamlined call center application, in addition to introducing a small business communications package using Comdial's award winning FX II platform to penetrate the 20 to 40-line market segment. To compliment its growing product portfolio, Comdial also announced several innovative marketing programs. The Company intends for the new products and programs combined with its national partner channel to grow sales in new market segments.

"I like the products -- I like the vision -- I like the direction. I'm very impressed and encouraged," remarked a Comdial channel partner. The channel partners in attendance were able to meet one on one with key Comdial executives and see presentations from an industry analyst, convergence channel consultant, Comdial product and service managers, and other Comdial partners.

Comdial Migration Investment Plan(SM)

The Comdial Migration Investment Plan (CMIP) represents a comprehensive strategy centered on product evolution (not revolution) and investment protection. Through a combination of technology upgrades and legacy system trade-ins, customers can preserve significant portions of their telecommunications infrastructure investment. For example, CMIP facilitates existing customers to easily add IP Telephony to their Comdial FX II systems without costly "fork-lift" replacements. While customers with basic voice messaging systems can upgrade to Comdial's latest call center applications to improve customer response and service capabilities. With CMIP, Comdial is the only company that can cost-effectively evolve their customers from legacy business telephone systems to the most-advanced IP communications and collaboration solutions.

Converged SIP Communications Platform

Comdial's converged SIP communications platform, code-named "Mercury" is a standards-based business communications platform. Mercury delivers IP Telephony advantages without sacrificing traditional telephone features, reliability and interoperability. Because of its unique design, growing enterprises can benefit from Mercury at a very affordable price.

Mercury builds on a standards-based protocol called Session Initiation Protocol (SIP), a signaling protocol for Internet conferencing, telephony, presence, events notification and instant messaging, which has been widely adopted among communications developers. Comdial's commitment to SIP, demonstrates how it will lead the industry in the adoption of industry- standard solutions that interoperate with third party software and hardware improving time-to-market and lowering total cost of ownership for customers.

Included in the Mercury portfolio is a new family of SIP-based telephones. Comdial's soft phone, which supports audio and video communications as well as instant messaging, provides customers with a rich, collaborative communications experience. A soft phone is the most cost-effective option when deploying IP Telephony throughout an enterprise and supporting remote teleworkers across broadband virtual private networks.

Mercury supports Comdial's Migration Investment Plan, enabling customers to easily upgrade their FX II's to Mercury. By allowing customers to add IP Telephony when the time is right, this migration option supports important customer requirements now and in the future. Mercury is scheduled for general availability in the fourth quarter of 2003.

Next Generation LAN Telephony Technology

Comdial also demonstrated new LAN telephony technology, code-named "Hercules". Hercules represents next generation technology that could lead to a paradigm shift in the multi-billion dollar enterprise communications market. Hercules was designed from the ground up to be easily manufactured, purchased, deployed, and supported. Developed as an all-in-one platform, Hercules will provide popular voice features, unified messaging, a wireless 802.11 SIP phone, and support Mercury's SIP phone family. Its aggressive price points and functionality, when released early next year, will define new price/performance standards. Regarding the Company's new technology, one channel partner commented "Comdial ... has migrated from keeping up to becoming a front runner in an ever changing business environment."

Comdial Call Center

Also demonstrated at Summit 2003 was Comdial's new call center offering. It is targeted at the 5 - 100 agent call center market segment and will begin shipping next month (June, 2003). Like Fortune 500 companies, growing enterprises understand the revenue impact of effectively managing customer call volume. However, high-end call center applications are generally too costly and cumbersome for small and medium-sized organizations to deploy. Compounding this is the recent phenomenon in distributed call centers, whereby companies are restructuring large, centralized call centers into small, more- manageable call centers nationally. Comdial's new call center solution offers these enterprises an answer to their quest for cost-effective, distributed call centers.

20-40 Small Business Package for New Market Segments

Comdial is closing in on a new market segment by positioning its award winning FX II platform to cost-effectively service offices with 20-40 employees. This market represents an excellent growth opportunity for Comdial to increase overall revenues and market share. "We are confident that we can achieve the same level of market success in the 20-40 line market that we have achieved in the 2-20 and 40-100 market segments," said Matt Hickey, Comdial's vice president of sales. Comdial channel partners at Summit 2003 were very excited and showed a high level of interest in carrying the new packages. The new 20-40 package also provides full support for Comdial's Migration Investment Plan to larger capacity FX II configurations as well as Mercury. Advanced functionality such as unified messaging, CTI, and call center applications are also available on these packages. Comdial has begun accepting orders for its new packages with delivery scheduled in June, 2003.

"These new products, technologies and marketing programs represent the needs of our customers at a time when value and performance are paramount," said Nick Branica, Comdial's president and CEO. "These initiatives represent proof-points in Comdial's mission to deliver innovative and cost-effective communications to small and medium-sized enterprises. We expect to reduce the cost of IP Telephony by 40-60% in six to nine months, while rolling out marketing programs that enhance our channels ability to fuel their sales growth."

New Service and Support Offerings

To improve the productivity of its channel partners, Comdial introduced three new offers. Its online knowledge base enables channel partners to research technical issues online and quickly find solutions. A keyword technical publications search tool allows technicians to search across multiple documents and thousands of pages of material instantly to find information on key terms. The online parts repair and return system facilitates quick and easy processing of part exchanges. Regarding the Summit and support offerings one attendee said, "The most successful Summit I have ever attended! Plenty of information about products, company vision and support structure. I came back energized."

Two-Year Warranty on Popular DX-80 Small Business Phone System

Comdial also announced at Summit 2003 that it is now offering a standard two-year warranty on its DX-80 products. The Company intends this move to signal its commitment to quality and that it stands behind its products. This doubles the existing warranty, improving customer confidence and peace of mind.

Comdial 'Thrive ... Not Just Survive' Summit 2003 Conclusion

During times of economic uncertainty and travel restrictions, participation levels at trade and manufacturer events have declined. The overwhelming success of Comdial's Summit 2003 is testimony to the loyalty and support of its channel partners. Those in attendance learned about the market direction, channel convergence evolution, Comdial's vision, strategy, and product and program roadmaps. As one partner summarized, "Comdial did an outstanding job and it may be the best money I spent all year. I came home ready to renew my efforts with a company that I felt understands what we are facing in the market." Comdial is now planning Summit 2004 where it hopes for a repeat performance.

About Comdial

Comdial Corporation, headquartered in Sarasota, Florida, develops and markets sophisticated communications solutions for small to mid-sized offices, government, and other organizations. Comdial offers a broad range of solutions to enhance the productivity of businesses, including voice switching systems, voice over IP (VoIP), voice processing and computer telephony integration solutions. For more information about Comdial and its communications solutions, please visit our web site at www.comdial.com .

Forward-Looking Statements

This press release contains statements that may constitute "forward- looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Investors and prospective investors are cautioned that any such forward-looking statements are not guarantees of future performance and involve risks and uncertainties, and that actual results may differ materially from those projected in the forward-looking statements as a result of various factors, including Comdial Corporation's ability to obtain additional funding for its business should such funding become necessary, its ability to maintain market share and to grow in a very competitive market, its ability to develop technologically advanced products to keep pace with many competitors that are much larger and have significantly more resources than Comdial, lower than anticipated demand brought about by continued weakness in the U.S. economy, risk of dilution of the company's stock from recently completed private placement investments, dependence on a relatively small number of large customers, ability to maintain necessary engineering, sales, marketing and other key staff members, the risks associated with the outsourcing of its manufacturing requirements, including international risk factors, its ability to achieve its operational goals and to generate positive cash flow, any unfavorable outcome of pending disputes or litigation, including, but not limited to intellectual property infringement claims that arise from time to time and the various other factors set forth from time to time in Comdial's filings with the SEC, including, but not limited to, Comdial's Form 10-K for the year ended December 31, 2002. Comdial Corporation undertakes no obligation to publicly update or revise the forward-looking statements made in this release to reflect events or circumstances after the date of this press release or to reflect the occurrence of unanticipated events.

Source: Comdial Corporation

CONTACT: Adriano Rosa, Director of Marketing, Comdial Corporation, +1-941-554-5000, ext. 1382
Web site: http://www.comdial.com/