Santa Clara, CA, May 11, 2005 - Bay Microsystems, the leader in high performance network processing solutions, today announced it has been awarded a follow-on contract with the U.S. federal government to provide high speed networking technology used in the government's global mission-critical secure broadband network. This new business is expected to generate several times more revenue than the previous multi-million dollar contract announced last year, establishing Bay Microsystems as the market share leader in high performance network processors for 2005.

"Bay Microsystems is an important technology partner in the U.S. Government's continuing efforts to deploy a flexible, secure communications infrastructure," said Dr. Pete Rustan, Director of Advanced Systems & Technology. "Developed in close collaboration with the U.S. Government, Bay's technology should enable future high-speed, secure networks that provide seamless internetworking and management of varying traffic types and data flows throughout the DoD and civilian network domains."

Bay has been delivering full-line rate 10Gbps system solutions to the U.S Government for more than two years and is continuing its Advanced Network Projects for device technology and network element development.

Chuck Gershman, President and CEO of Bay Microsystems, stated "Our silicon and associated collapsed edge gateway solutions are being vetted through the most demanding broadband network in the world. This new contract ensures that Bay will continue to maintain our leadership position in high speed network innovation. We have made great strides with our 40Gbps solutions that we're developing in concert with our US Government customers. Further, we anticipate that initial gateway solutions will be available to our commercial customers as early as this year."

The Internetworking Processor family is the heart of solutions that can mediate, aggregate, switch and transport voice, video and data traffic across network domains including LAN, SAN and WAN. These solutions are achieved through the family's unique protocol agile processing capabilities. This processing empowers maximum line rate operation for interworking and mediation of IPv4, IPv6, ATM, Frame Relay, SONET, Fibre Channel, GFP and other protocols simultaneously. The family includes Montego®, the industry's only OC192c/10G processor capable of classification, policing, segmentation and reassembly, and traffic management at wire rate. Biscayne™ is a programmable classification processor that can parse, classify and police packets and cells at rates up to 16 Gbps, at minimum packet size regardless of traffic patterns.

Bay Microsystems is a privately-held communications technology company delivering programmable network processors, software and network elements for high performance intelligent networks. Bay's Internetworking Processor™ family of products is scalable, intelligent and ultra-high performance, and is in use within broadband networks developed by the U.S. Government and by commercial providers serving the metro-edge, metro-core, regional and long-haul markets. For more information please visit www.baymicrosystems.com.

Editor Contacts:

Tim Helms
Helms Communications
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Bill Weisinger
Bay Microsystems
408-437-0400
Contact: Info at Bay