Redback to Be Acquired by Ericsson for $2.1 Billion

Redback Networks Inc. (NASDAQ: RBAK), a market leader in
multi-service edge routing for next generation broadband networks, is
today announcing a definitive agreement to be acquired by Ericsson
(NASDAQ: ERIC), the world's leading telecommunications supplier, for
$2.1 billion or $25 dollars per Redback share. The acquisition is
expected to occur by means of a tender offer for all of the
outstanding shares of Redback common stock. The acquisition is subject
to customary closing conditions and regulatory approvals, and is
expected to be completed in early 2007.

The acquisition of Redback will play a key role in Ericsson's
strategy to help telecommunications carriers lower costs and upgrade
their networks for broadband, telephone, video and mobility services.
Redback will retain its management team and operate as a wholly-owned
subsidiary of Ericsson. In accordance with the acquisition, Redback
plans to accelerate its product development and continue to expand its
operations to meet growing customer demands for next generation
broadband networks. Redback will continue to focus on video and
mobility routing markets to leap-frog its traditional competitors.

"This agreement is about accelerating market growth, integrating
IP routing and mobility expertise and shaping the future of next
generation networks. Video changes everything about networks today.
Redback is the acknowledged technology leader delivering broadband,
phone, video and mobility services over Internet-based
infrastructures," said Kevin DeNuccio, Redback president and CEO, who
will report directly to a management board chaired by the president
and CEO of Ericsson, Carl-Henric Svanberg. "We believe Redback now
will have the global reach and financial resources to accelerate its
own routing technology innovation and grow market share faster than
our traditional routing competitors."

"Redback has always had a well-known technology advantage over its
larger routing competitors in broadband services edge routing," said
Carl-Henric Svanberg of Ericsson. "We believe the combined strengths
of both companies in mobility and IP routing will create significant
value for customers and shareholders. Today's agreement accelerates
Ericsson's ambition to build leadership in the fast growing broadband
and IP services market."

The total addressable market for IP edge routing is expected to
exceed $5 billion by 2009, according to the Yankee Group. Ericsson and
Redback believe there is market opportunity to upgrade more than two
billion wired and wireless users worldwide over the next ten years to
all IP-based broadband infrastructures. This opportunity is ten times
larger than the 250 million broadband users today. On a worldwide
basis, all carriers have some plans to unify communications and
entertainment services over IP-based broadband networks.

Citigroup and SEB Enskilda are acting as Ericsson's financial
advisors in the acquisition. UBS is acting as the financial advisor
for Redback.

About Redback Networks

Redback Networks Inc. manages 50 million broadband connections for
15 of the top 20 telephone carriers worldwide. Redback's multi-service
routing platform delivers next generation broadband services such as
VoIP, IPTV and On-Demand Video. Redback Networks has more than 500
carrier customers worldwide and is based in San Jose, CA. In 2006,
Redback marks its 10 year anniversary, celebrating ten years of
broadband innovation. For more information, visit Redback Networks at
www.redback.com.

Redback Media Relations

Zenobia Austin Godschalk, BPR

(w) 404.848.9507

(c) 650.269.8315

About Ericsson

Ericsson is shaping the future of mobile and broadband Internet
communications through its continuous technology leadership. Providing
innovative solutions in more than 140 countries, Ericsson is helping
to create some of the most powerful communications companies in the
world. For more information visit: www.ericsson.com

Ericsson Media Relations

Phone: +46 8 719 6992

E-mail: press.relations@ericsson.com

Investor Relations, North America

Phone: +1 212 843 8435

E-mail: investor.relations@ericsson.com

CONFERENCE CALL

Meeting Date: Wednesday, December 20, 2006 08:00 AM (Pacific Time)

To Join Audio Conference

Primary Dial-In: 1 (800) 559-2403

Alternate Dial-In: 1 (847) 619-6534

Please be prepared to provide the following information to gain
access to your audio conference call.

Confirmation Number: 16614405

Host Name: Kevin DeNuccio

Company: Redback Networks, Inc

A webcast has been set-up for press and industry analysts. The
weblink is below.

http://phx.corporate-ir.net/phoenix.zhtml?p=irol-eventDetails&c=80
517&eventID=1443118 (Due to its length, this URL may need to be
copied/pasted into you Internet browser's address field. Remove the
extra space if one exists.)

* REDBACK and SmartEdge are trademarks registered at the U.S.
Patent and Trademark Office and in other countries. NetOp is a
trademark of Redback Networks Inc. All other products or services
mentioned are the trademark, service marks, registered trademarks or
registered service marks of their respective owners.

THIS PRESS RELEASE IS FOR INFORMATIONAL PURPOSES ONLY AND IS NOT
AN OFFER TO BUY OR THE SOLICITATION OF AN OFFER TO SELL ANY
SECURITIES. THE SOLICITATION AND THE OFFER TO BUY SHARES OF REDBACK
COMMON STOCK WILL ONLY BE MADE PURSUANT TO AN OFFER TO PURCHASE AND
RELATED MATERIALS THAT ERICSSON INTENDS TO FILE WITH THE SECURITIES
AND EXCHANGE COMMISSION. REDBACK STOCKHOLDERS AND OTHER INVESTORS
SHOULD READ THESE MATERIALS CAREFULLY BECAUSE THEY CONTAIN IMPORTANT
INFORMATION, INCLUDING THE TERMS AND CONDITIONS OF THE OFFER. ONCE
FILED, REDBACK STOCKHOLDERS AND OTHER INVESTORS WILL BE ABLE TO OBTAIN
COPIES OF THE TENDER OFFER STATEMENT ON SCHEDULE 'TO', THE OFFER TO
PURCHASE AND RELATED DOCUMENTS WITHOUT CHARGE FROM THE SECURITIES AND
EXCHANGE COMMISSION THROUGH THE COMMISSION'S WEB SITE AT WWW.SEC.GOV.
REDBACK STOCKHOLDERS AND OTHER INVESTORS ALSO WILL BE ABLE TO OBTAIN
COPIES OF THESE DOCUMENTS, WITHOUT CHARGE, FROM THE INFORMATION AGENT
FOR THE OFFER, THE DEALER MANAGER FOR THE OFFER, OR FROM ERICSSON.
STOCKHOLDERS AND OTHER INVESTORS ARE URGED TO READ CAREFULLY THOSE
MATERIALS PRIOR TO MAKING ANY DECISIONS WITH RESPECT TO THE OFFER.

Statements in this release that are not statements of historical
fact may include forward looking statements within the meaning of
Section 27A of the Securities Act of 1933, as amended and Section 21E
of the Securities Exchange Act of 1934, as amended. Any such
forward-looking statements are made pursuant to the safe harbor
provisions of the Private Securities Litigation Reform Act of 1995.
Such forward-looking statements include statements concerning the
completion of the transactions contemplated by the merger agreement,
including the merger and the timing thereof and the business
opportunities afforded by the merger. Important factors that may cause
actual results to differ include: risks that could prevent or delay
the closing of the transaction, including customary conditions to
closing an acquisition transaction of this type, including obtaining
requisite regulatory clearances, and acceptance of the offer by
holders of a sufficient number of shares of Redback common stock. For
a discussion of other risks facing Redback's business, please refer to
the documents filed by Redback Networks Inc. with the United States
Securities and Exchange Commission from time to time.