BEVERLY, Mass., July 12, 2004 - It's nine o'clock in the morning in Hong Kong. A client has just called her account supervisor at the global marketing consultancy Lowe Worldwide. She needs a campaign proposal for five Asian markets, including a launch in China, by the following morning. Quickly, the account manager creates a Groove workspace and invites key people from each business unit -- strategy planners, creative, traffic and senior management. The planners rapidly populate the space with their research and initial strategic direction. Account staffers draft briefs, and senior management checks progress every couple of hours, getting a full overview in minutes by surveying workspace activity. Copy is written in English; the Chinese team drafts its translated headlines in the workspace. Video interviews with target customers are filmed and dropped into a Groove file folder. The client is invited to the workspace and views the footage from five markets the same day as it was filmed. By midnight, the proposal is finalized, and at 9 a.m. the next day the client seeks approval for the campaign.

To achieve this efficiency, Lowe Worldwide needed more than a collaboration solution. It needed Groove Virtual Office to tie its 13 separate agencies in Asia together to get everyone on the same page, even if they're serving different markets with different languages and clients. The result? Fewer phone calls, faxes, overnight package deliveries, plane fares, and dollars spent setting up extranets for key accounts. And more business won.

Lowe Worldwide is one of many Global 1000 companies that have secured rapid returns on their investments in Groove Virtual Office software, which allows teams of people to work securely over a network as if they were in the same location. After four months of extensive beta testing, Groove Networks today began shipping Groove Virtual Office v3.0 to enterprise, public sector and small business customers worldwide

Groove Virtual Office - new name, same value
Previously called Groove Workspace, Groove Virtual Office more aptly characterizes the ways customers use and benefit from Groove software. Transcending team collaboration, large commercial enterprises deploy Groove to cost-effectively support any business process, project, or information-sharing requirement that spans the networked office environment. Recent studies indicate that this type of "virtual office work" affects nearly 90 percent of workers today due to increased outsourcing, offshoring, partnerships, teleworking, "hoteling," and travel.

Groove Virtual Office version 3.0 is a major upgrade with hundreds of enhancements, some particularly beneficial for commercial enterprises, including more robust control and management of Groove client software, and an enhanced forms tool. The forms tool lets non-technical users quickly create custom applications that extend live, structured data from internal systems to mobile workers and third parties. Customers worldwide have been trialing version 3.0 since March, including Lowe Worldwide, Reuters, GlaxoSmithKline, and Hewlett Packard.

Reuters is a global information company providing indispensable data tailored to professionals in the financial services, media and corporate market. The company has been awaiting v3.0 before encouraging business and technology project teams to supplement their use of email with its more effective workgroup project management capabilities. "We view Groove as more effective than email for teams working on projects," said Mandeep Singh Narula, principal, Reuters' strategy innovation group. "There's a lot of interaction among project teams in New York, London, and elsewhere. Groove brings a lot of disparate project information into one place. But it's not just about posting information; it's the product's support for the project team's interaction around the information that makes it an effective solution."

GlaxoSmithKline, a world leading research-based pharmaceutical company with $35.2 billion in sales in 2003, has been using Groove software since 2001. The company has established Groove Virtual Office as its tool of choice for secure external communication with partners, suppliers, and others. "With version 3.0, Groove has lowered the bar for adoption," said Stephen Daluisio, a GSK collaborative computing research engineer. "The user interface is more intuitive, performance has improved, and the new files workspace and forms capabilities are extremely powerful. We're looking forward to transitioning to version 3.0."

Hewlett Packard, a global technology company with $73.1 billion in revenue in 2003, has deployed Groove software to support a variety of inter-business activities, including development of proposals and other key business documents. "The new Groove folder synchronization capability is powerful because it doesn't require users to change the way they work, and stands to reduce our technology infrastructure costs," said Craig Samuel, of Hewlett Packard Services' advanced technology group. "It's a win-win."

Groove Virtual Office software is comprised of core capabilities -- secure data synchronization, activity awareness, and contextual conversation -- that let teams work together virtually, online and offline, independent of geographic or organizational boundaries, while flexibly supporting their unique work styles and requirements. A palette of included tools enables teams to customize workspaces to meet their unique requirements. Corporate and third-party developers can also develop their own custom tools, or access Groove's core capabilities via other applications. IT departments can centrally manage Groove deployments and usage, and integrate Groove data with centralized systems and databases.

Key enhancements to Groove Virtual Office version 3.0 include:

• Launchbar - to view and access Groove workspaces, contacts, and activity from a single location;
• Rapid applications with enhanced forms - for rapidly creating business process-specific applications and connecting them to back-end databases and systems. The product comes with 10 ready-made yet customizable forms templates to help users get started;
• Microsoft® Windows®-integrated folder synchronization - for securely sharing files across any number of a user's own PCs, or among multiple users' PCs, even across firewall boundaries;
• Expanded alerts and activity awareness - to signal when individuals come online, enter workspaces, and perform important activities through visual, audible, and spoken notifications;
• Improved performance - to quicken the start-up time and navigation of the Groove user interface, as well as data transfer among users;
• Third-party Public Key Infrastructure (PKI) support - to enable organizations to use their own certificate authorities for identity authentication;
• Activity auditing for regulatory compliance - to centrally capture workspace activity and data on users' PCs for regulatory compliance;
• Expanded Web Services API - for creating discrete applications that consume some or all Groove virtual office capabilities such as synchronization and presence awareness; and
• .NET API - for developing custom tools or bots that run within Groove Virtual Office, using Visual Studio®.net as the integrated development environment.

Pricing, Availability, andSystem Requirements
Groove Virtual Office version 3.0, comprising client and server software and development offerings, is available immediately via Groove Networks' direct sales at sales@groove.net. Groove Virtual Office Professional Edition v3.0 is priced at US $179; Project Edition at US $229; and File Sharing Edition at US $69. Hosted Relay and Management services are priced at US $40 per user per year. The list prices for customers who want to deploy their own servers are: Groove Enterprise Relay Server, US $14,995; Groove Enterprise Management Server, US $19,995; and Groove Enterprise Integration Server, US $9,995.

Groove Virtual Office v3.0 runs on Microsoft Windows NT® 4.0 (with Service Pack 5 or later), Windows 2000, or Windows XP, Windows 98 and Windows ME, and requires Microsoft Internet Explorer 6.0. The software requires a PC with an Intel® Pentium® 400 MHz or higher processor (or equivalent) with a minimum of 256 MB of RAM, 100 MB of hard disk storage, and a 56 kbps modem (local area network, DSL or cable modem preferred). A sound card, speakers, and microphone may be required to use the software's voice and audible alert capabilities.

About Groove Networks
About Groove Networks Founded in October 1997 and headquartered in Beverly, Mass., Groove Networks Inc. delivers the "virtual office" through software that allows teams of people to work together over a network as if they were in the same physical location. Groove software helps organizations large and small save money, time and travel by offering both a desktop application for instant joint work, and a set of customizable, open collaboration capabilities that enhance the utility and value of existing solutions. A 60-day free trial edition of Groove Virtual Office is available at http://www.groove.net/downloads/groove/.

Groove Networks and Groove are registered trademarks of Groove Networks Inc. All other trademarks are owned by their respective companies.