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Vertical Reports Profitability, Growth and a Growing Share of the Unified Communications market

Connections 2010, Vertical's annual partner conference provides in-depth look of Vertical's Unified Communications & SMB IP Telephony strategy

SANTA CLARA, California, November 4, 2010 – Vertical Communications, a leading provider of next-generation IP-based phone systems and voice applications, is currently hosting its annual partner conference – Connections 2010 – at the Biltmore Hotel in Phoenix, AZ.  Vertical announced strong progress in executing against its business plan and several operating highlights from its fiscal year 2010 ended June 30, 2010 as well as the quarter ended September 30, 2010.

Among the notable announcements:

  • Profitability and operating cash flow positive performance for the fiscal year ended June 30, 2010; and increased profitability and cash flow from operations for fiscal year Q1 2011 vs. Q1 2010 (ended September 30).
  • Significant progress in migrating its channel and customer base from legacy TDM PBX products to its Wave IP Unified Communications and SBX IP systems; Vertical’s next generation product portfolio now represents over 65% of quarterly sales and contributes over 75% of gross profit.  Vertical has shipped over 6,500 Wave IP systems and over 7,500 SBX IP systems since introduction.
  • Launch of the new MBX IP telephone system for the SMB market.  MBX IP is a more scalable complement to the SBX IP system as a cost-effective, feature rich hybrid telephone system; it supports the same endpoints, offers an expanded feature set including native IP and TDM support, and is scalable up to 400 ports.  Importantly, MBX IP will also support migration from Comdial and Vodavi systems, with the ability to drive both legacy endpoints as well as IP endpoints.  MBX IP completes Vertical’s portfolio of SMB and Unified Communications offerings.
  • Partnership with Telanetix/AccessLine (OTC BB: TNXI); Vertical announced its participation in the CIM program to offer and integrate SIP trunking services with Vertical’s product portfolio.  Product integration benefits include improved ease of deployment, quality of service (QOS) and proactive tools to support customers.
  • Reviewed key accomplishments of the last 9 months:
    • Release of Wave IP 2.0, further extending its award-winning United Communications offerings for business customers.  Read more on the 2.0 release at
    • Product of the Year award for Wave IP from Unified Communications magazine.
    • Key new hires in Sales, Marketing and Customer Support to facilitate and support Vertical's growing customer base; as of September 30, 2010 Vertical's employees and contract staff numbered approximately 200.

“Despite a challenging economic environment over the last 24 months, we are very proud of our performance in remaining profitable, driving our technology and products forward, and expanding both our channel and market share.  We are excited about the trends we are seeing in our business in terms of strong pipeline/demand growth, shortening sales cycles, and higher demand for Unified Communications products and services in particular”, said Peter Bailey, President and Chief Operating Officer, Vertical Communications.

According to Bailey, “The growth of Unified Communications is an exciting market opportunity for Vertical as we have spent the last several years investing heavily in R&D to bring unique Unified Communications technology to the market, specifically tailored the meet the needs of sub-1,000 employee organizations.  Our solutions are: cost effective, easy to deploy, simple to use, and target a return on investment in under 1-year.  In partnership with our highly competent and well-established telephony and IT VAR channel we expect to be a significant participant in this market over the next several years”.

About Vertical Communications, Inc.

Vertical Communications is one of the largest telephony vendors in North America and a global leader in next-generation IP-based voice and data and digital communications systems for business, with a current installed base of over 200,000 customers. Vertical combines voice and data technologies with business process understanding to deliver integrated IP-PBX and application solutions that enhance customer service and business productivity. Vertical’s customers are leading companies of all sizes, from small to large and distributed, and include CVS/pharmacy, Staples and Apria Healthcare. Vertical delivers its solutions through a worldwide network of over 1800 business partners. With headquarters in Santa Clara CA, Vertical has sales, engineering and operations facilities in Charlottesville VA, Phoenix AZ, Munich Germany and Hyderabad India. For more information about Vertical, please call 877-VERTICAL or visit


"Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995.
This document contains forward-looking statements based on current expectations or beliefs, as well as a number of assumptions about future events, and these statements are subject to important facts and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. The forward-looking statements in this document address a variety of subjects, including, without limitation, statements about the benefits of certain of the Company’s products, including, without limitation, the improved cost and customer service benefits for the Company’s business partners and customers; the Company’s assumptions about the future performance of V-Connect; the Company’s ability to enhance its revenue opportunities in the IP-PBX marketplace; the Company’s ability to continue providing products to the IP-PBX marketplace, the Company’s ability to continue to certify additional Internet Telephony Service Providers in the IP-PBX marketplace and others. The following factors, among others, could cause actual results to differ materially from those described in these forward-looking statements: the risk that the Company may fail to achieve the anticipated benefits from V-Connect, including, without limitation, failing to obtain the desired benefits for the Company’s dealers and customers; the risk that the Company’s assumptions about the future performance of V-Connect may prove to be incorrect; the risk that the Company may be unable to become a significant player within the IP-PBX telephony market; the risk that the Company will not be able to certify its products with additional Internet Telephony Service Providers.

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Vertical Communications and the Vertical Communications logo and combinations thereof, Wave IP are registered trademarks of Vertical Communications, Inc. All other brand and product names are used for identification only and are the property of their respective holders.


Craig Morgan
Vertical Communications, Inc.
+1 (408) 404-1643