CHICAGO, Feb. 16, 2010 (GLOBE NEWSWIRE) -- Neutral Tandem, Inc.
(Nasdaq:TNDM), a leading provider of tandem interconnection services,
today announced that it is introducing a new Ethernet eXchange service
offering designed to meet the needs of Ethernet service providers.
Neutral Tandem's Ethernet eXchange platform combines next generation
technology with its existing carrier customer interconnections to
provide Ethernet service providers with a streamlined means to pass
voice, data and video between one another in a neutral interexchange
point. "Neutral Tandem's goal is to address the void in the Ethernet
market by providing Ethernet service providers with a more efficient
and simplified method of interconnecting on a one-to-many basis. Our
new Ethernet eXchange platform will help these service providers
accelerate revenue in the rapidly growing Ethernet market," said Rian
Wren, CEO of Neutral Tandem.

Significant demand exists for Ethernet interconnection due to the
limited number of on-net locations each Ethernet provider serves. Given
this, Ethernet service providers engage in complex, one-off
interconnects with multiple third party carriers in an effort to
provide seamless service to their customers. These interconnection
arrangements are characterized by complex translations of service
characteristics between disparate networks and prohibitively slow
provisioning intervals that often take several months, resulting in
adverse impacts on service provider profitability. These challenges are
further aggravated by the lack of available solutions for Ethernet
service providers to easily extend their reach into secondary markets.

According to Vertical Systems Group, worldwide revenue for Business
Ethernet services is projected to reach $40.2 billion by 2014. The
growth of Ethernet is being driven by a combination of factors which
include the migration by enterprises of all sizes from traditional
Frame Relay, ATM and TDM private line services to Ethernet connectivity
services, as well as wireless carriers using Ethernet for mobile
backhaul to address the six-fold increase in data traffic on mobile
broadband networks. "Ethernet providers face several challenges when
interconnecting, including incremental costs and controlling
synchronization to ensure consistent service levels for customers.
There is growing demand among Ethernet providers for solutions that
effectively address these challenges, bolstered by the new ENNI
standard just ratified by the MEF," said Rosemary Cochran, Principal at
Vertical Systems Group.

"Up until now, much of the growth among Ethernet service providers has
been largely confined within each provider's network. NT is changing
the market dynamics with its neutral, Ethernet eXchange, which acts as
a nexus for the Ethernet community by enabling providers to
interconnect with one another in a centralized hub instead of having to
negotiate and provision connections with multiple carriers one by one,"
said Surendra Saboo, COO of Neutral Tandem. Utilizing Neutral Tandem's
Ethernet eXchange service solves the complex technical and business
challenges traditionally tied to interconnecting to multiple service
providers. In addition, Ethernet service providers can virtually
connect to multiple access providers in out-of-footprint markets,
through a single connection to the Ethernet eXchange. "By
interconnecting our Ethernet eXchanges across the country over an MPLS
network, Neutral Tandem provides a unique advantage by enabling service
providers to connect at one Ethernet eXchange yet extend their reach
into multiple markets," continued Saboo. This results in an increase in
the number of providers that can address customer needs, thereby
reducing costs, to help speed the adoption of Ethernet technology.

"Neutral Tandem's development of our Ethernet eXchange service is
complementary to our core business in many ways. Many of our existing
carrier customers who provide Ethernet services and are potential
customers of our eXchange are already collocated at one or more of our
switch sites. In addition, we believe that our proven experience in
interconnecting carriers combined with our IP backbone network,
technical resources and our footprint in dozens of major markets forms
a winning combination," said Wren.

The initial 2010 market deployment schedule of the Ethernet eXchange
offering is planned for the following markets: Atlanta, Boston,
Chicago, Dallas, Denver, Detroit, Houston, Los Angeles, Miami, New
York, Philadelphia, San Francisco, Seattle and Washington, D.C.
Additional market deployments, both domestic and international, are
being planned and will be prioritized based on customer demand.

Cautions Concerning Forward Looking Statements

This press release contains forward-looking statements that involve
substantial risks and uncertainties. All statements, other than
statements of historical fact, included in this press release regarding
Neutral Tandem's strategy, future operations, future financial
position, future revenues, projected costs, prospects, plans and
objectives of management are forward-looking statements. The words
"anticipates," "believes," "expects," "estimates," "projects," "plans,"
"intends," "may," "will," "would," and similar expressions are intended
to identify forward-looking statements, although not all
forward-looking statements contain these identifying words. Neutral
Tandem may not actually achieve the plans, intentions or expectations
disclosed in its forward-looking statements. Actual results or events
could differ materially from the plans, intentions and expectations
disclosed in the forward-looking statements Neutral Tandem makes.
Factors that might cause such differences include, but are not limited
to: risks associated with our ability to successfully develop and
market Ethernet interconnection services, including but not limited to
identifying, obtaining, operating and maintaining attractive network
switch sites, equipment and software, cost estimation errors or
overruns, interconnection delays, material delays or shortages, our
inability to obtain necessary permits on a timely basis, if at all, and
other factors, including the impact of regulation, many of which are
beyond our control and all of which could delay our ability to offer or
market this new service; and other important factors included in
Neutral Tandem's reports filed with the Securities and Exchange
Commission, particularly in the "Risk Factors" section of Neutral
Tandem's Annual Report on Form 10-K for the period ended December 31,
2008 and Quarterly Reports on Form 10-Q for the quarters ended March
31, 2009, June 30, 2009 and September 30, 2009, as such Risk Factors
may be updated from time to time in subsequent reports. Neutral Tandem
does not assume any obligation to update any forward-looking
statements, whether as a result of new information, future events or
otherwise.

About Neutral Tandem, Inc.

Headquartered in Chicago, Neutral Tandem, Inc. is a leading provider of
tandem interconnection services to wireless, wireline, cable and
broadband telephony companies. Neutral Tandem's solutions build
redundancy, security and operational efficiencies into the nation's
telecommunications infrastructure. As of December 31, 2009, Neutral
Tandem was capable of connecting approximately 480 million telephone
numbers assigned to carriers. Telephone numbers assigned to a carrier
may not necessarily be assigned to, and in use by, an end user. Please
visit Neutral Tandem's website at: www.neutraltandem.com.

The Neutral Tandem Inc. logo is available at
http://www.globenewswire.com/newsroom/prs/?pkgid=3797


CONTACT: Neutral Tandem, Inc.
         Media Contact:
         Gerard Laurain
           1-312-384-8041
         Investor Contact:
         Jim Polson:
           1-866-268-4744