CORRECTING and REPLACING Fonality is Cash Flow Positive in March, Attains 162% Average Annual Growth

Strongest Financial Position Ever and New Products Attract Larger Customers
CULVER CITY, Calif.--(Business Wire)--
In an April 29 story about Fonality's financial health the growth rate for the
company was erroneously reported as 102%. Fonality's growth rate was 162%, not
102%, as previously reported.

The corrected release reads:

FONALITY IS CASH FLOW POSITIVE IN MARCH, ATTAINS 162% AVERAGE ANNUAL GROWTH

Strongest Financial Position Ever and New Products Attract Larger Customers

Fonality, Inc. (www.fonality.com), the number one commercial grade vendor of
open-source IP phone systems, announces strong financial results and product
innovation. Cash flow was positive in March with 162% annual growth, zero debt,
and 8 figures of cash reserves in the bank.

"The secret to a great business is to enter a big market with a better product,
at a lower price, and to do so profitably. Fortunately, the technology sector
makes this formula more possible than in any other industry," says CEO Chris
Lyman. "And, we aren't stopping there. In the first quarter of 2009 we invested
16% of revenue back into R&D. Compare that to Avaya at 8% and you see how
serious we are about continuing to innovate."

Financial results have come from increased sales of applications, call center
software, and larger customers purchasing multi-site systems. Since the economic
downturn sales from companies with over 20 employees have increased by 52%. With
such growth has come the demand for an even richer feature-set. Today, 51% of
Fonality`s customers are using its Call Center Edition product. To build on this
success, Fonality recently introduced two new products:

* Unified Agent Edition: for the first time ever customers can connect
Salesforce.com to their phone system in a meaningful way. Agents receive desktop
alerts of how many dollars a call is worth before they answer the phone, while
supervisors use the Salesforce.com interface to find out how long it takes to
call leads back, which salespeople are the most productive, and which customers
are being neglected.
* HUD Queues: call center supervisors and agents can, in real-time, instantly
see the health of their queues including information on agents, holding callers,
abandoned vs. completed call stats, and more.

Chris Villar, President of Front Point Security was floored by the results.
"We`ve seen the benefit of employing HUD queues within the first 24 hours. We
set an expectation that our employees are to answer a call within 30 seconds. In
the unlikely event that a call is abandoned, the HUD interface invokes a pop-up
that allows for an instant call back. Customers are amazed by our level of
service. It`s no wonder that HUD has become a verb in our office," says Villar.

Internally, Fonality holds itself to the same operational excellence standard
touted to its customers, due to using its own applications. With the recently
launched customer care team, inbound technical support calls are monitored
through HUD Queues. The application has led to call abandonment reduction by 37%
and improved customer satisfaction by 17%.

"2009 is the year you have to grow by being smarter; not by doing the same thing
for longer," added Lyman. "At Fonality, we are committed to building products
that improve not only our efficiency, but yours as well."

Pricing and Availability

Fonality products are available through Fonality direct sales, Fonality's
Ultimate Channel Program network of resellers, and through Dell at
dell.com/voip. Fonality products start at a list price of $995, depending on
system configuration, applications, and endpoints. Deploying a Fonality solution
averages 60% less cost than a traditional, proprietary PBX system.

About Fonality

Fonality, the number one commercial grade vendor of open-source IP phone
systems, uses its Hybrid Hosted approach and Anywhere Management architecture to
create the reliability and quality of a premise-based system with the
convenience and cost benefits of a hosted system. Founded in 2004 and
headquartered in Culver City, Calif., the company has over 44,000 systems
deployed worldwide. Investors include Draper Fisher Jurvetson, Intel Capital,
and Azure Capital Partners. More information can be found at www.fonality.com.

Fonality, Inc.
Alok Vasudeva, 310-693-7404
avasudeva@fonality.com

Copyright Business Wire 2009