The network also includes the provision of high-speed Internet connectivity to more than 200 of those sites. When completed, the network will be the largest known deployment of fixed satellite telephony in Peru.

Telerep is supervising the integration of this network as part of the National Program for Rural Telecommunications Projects managed by Peru's Telecommunications Investment Fund (FITEL). FITEL is a department of OSIPTEL, Peru's national telecommunications agency.

Telerep initially won the concession for this project from FITEL in 1999. Telerep will serve as primary integrator for this government-subsidized project. OSIPTEL will pay all subsidies for this contract directly to Gilat.

Telerep President Luis Adrianzen said, "After our evaluation of many potential suppliers, Gilat was selected because of its best financial proposal, its experience in Peru, its long history of success in the Latin American market and Gilat's demonstrated expertise in satellite telephony and Internet Protocol (IP) technologies.

Gilat's technology exceeds the specifications established by FITEL and will allow us to serve 1.5 million people in small communities nationwide."

The network, based on Gilat's DialAw@y IP Very Small Aperture Terminal (VSAT) product, will begin deployment immediately and is expected to reach completion in the third quarter of this year.

Gilat will leverage its existing rural telephony infrastructure in Peru - which already serves more than 200,000 citizens at approximately 220 sites - to provide Telerep with a comprehensive VSAT network solution.

Gilat expects to transfer the Telerep contract to its StarBand Latin America business. Last month, Gilat announced a series of transactions through which rStar Corporation - of which Gilat is the majority shareholder - would acquire the StarBand Latin America business.

Gilat Latin America Chief Executive Officer Giora (Gigi) Oron said, "This award is an excellent example of Gilat's ability to fulfill rural telephony requirements anywhere in Latin America, as well as the high-speed Internet opportunities on which StarBand Latin America is focused.

We are confident DialAw@y IP will meet FITEL's initial needs, providing us with the prospect of adding Internet service to even more of these original sites and expanding this network to additional communities over the next few years."

DialAw@y IP is the only VSAT product capable of providing high-speed Internet connectivity and toll-quality telephony service on a single, low-cost platform. Each unit supports a PC/LAN connection and up to three telephone channels.

It is a low-cost solution for the fulfillment of Universal Service/Access Obligations, Public Call Office requirements and small office/home office (SOHO) requirements for bundled telephony and Internet access.

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