XO Communications Selects ViryaNet Service Hub for Telecommunications

XO Communications Committed to Delivering High-Quality Service to Its Customers

Southborough, Mass. - July 14, 2003 - ViryaNet (NASDAQ: VRYA), a leading provider of integrated mobile and Web-based software applications for workforce management and the automation of field service delivery, today announced that XO Communications selected ViryaNet Service Hub for Telecommunications for its workforce management requirements. XO Communications is a full-service provider of communications services for small and growing businesses, large enterprises, and carriers - with a presence in over 60 major markets in North America.

XO will use Service Hub for Telecommunications suite of applications, which comprises Workforce Management, Advanced Scheduling Optimization, Mapping, Contract Entitlement, Field Parts Logistics, and automated work flow processing to automate its technicians and field service business processes.

"We are committed to providing the best possible service to our customers and empowering our employees to quickly and efficiently respond to our customer needs by using strong service processes with quality information, "said Mark Faris, Senior Vice President, Network Operations, XOCommunications. "ViryaNet's applications will allow our technicians to interact with other members throughout our organization and provide our customers with a consistent and high quality of service. We will use ViryaNet Service Hub to deepen our relationships with our customers, which is the foundation upon which we have built our business."

With ViryaNet Service Hub for Telecommunications, XO Communications will automate the workforce activities and improve the effectiveness of more than 500 technicians by scheduling and dispatching the technician to the right place at the right time with the right information and parts. ViryaNet's solution will allow XO to capture logistics and labor activity at the source, and monitor, report, and measure field activity through key performance indicators.

In addition, ViryaNet Service Hub for Telecommunications will allow XO to integrate into existing applications like trouble ticketing, provisioning, preventive maintenance, and installations; and coordinate workforce activities into a single system. The result will be more efficient use of technicians and assets while meeting customer entitlements and commitments.

"Today's telecommunications companies are especially conscientious about purchasing products with a strong ROI," stated Win Burke, President and CEO, ViryaNet. "With a strong record of success in the telecommunications market, ViryaNet fundamentally understands the challenges faced by this industry, and addresses them with a mobile workforce solution that incorporates over a dozen years' experience in field service automation. XO has an impressive eight-year history in voice and data communications, and a thorough understanding of the technologies of the future. We are excited to be working with such a visionary company, one so customer centric."

About XO Communications

XO Communications is a leading broadband communications service provider offering a complete set of communications services, including: local and long distance voice, Internet access, Virtual Private Networking (VPN), Ethernet, Wavelength, Web Hosting, and Integrated voice and data services. XO has assembled an unrivaled set of facilities-based broadband networks and Tier One Internet peering relationships in the United States. XO currently offers facilities-based broadband communications services in more than 60 markets throughout the United States.

About ViryaNet

ViryaNet is a provider of software applications that improve the quality and efficiency of an organization's service operations. ViryaNet's flagship product - the award-winning ViryaNet Service Hub - combines the power of the Internet, the freedom of wireless technologies, and the resources of ViryaNet's deep service expertise to help companies improve workforce scheduling, dispatching, and activity reporting; customer contract and entitlement automation; and asset, logistics and repairs management.

Customers in the utility, telecommunications, grocery and retail, high-technology manufacturing, HVAC, and other service industries use ViryaNet Service Hub to transition complex service business processes into a manageable, scalable Internet operation, with the goal of increasing service revenues, decreasing service costs, and maximizing customer satisfaction.

Safe Harbor Statement

Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995: The statements contained in this press release that are not purely historical are forward-looking statements within the meaning of Section 21E of the Securities and Exchange Act of 1934, as amended, including statements regarding ViryaNet's expectations, beliefs, intentions, or strategies regarding the capabilities of its products, its relationships with its customers, its customer purchases, its future operational plans and objectives including integration of other businesses, its future business prospects, its future financial performance, its future cash position, and its future prospects for profitability. All forward-looking statements included in this document are based upon information available to ViryaNet Ltd. as of the date hereof, and ViryaNet Ltd. assumes no obligation to update any such forward-looking statements. Forward-looking statements involve risks and uncertainties, which could cause actual results to differ materially from those projected. These and other risks relating to ViryaNet's business include market acceptance of and demand for the Company's products, risks associated with a slow-down in the economy, risks associated with the financial condition of the company's customers, risks associated with competition and competitive pricing pressures, risks associated with increases in costs and operating expenses, risks in technology development and commercialization, the risk of operating losses, risks in product development, risks associated with international sales, and other risks that are set forth in ViryaNet's Form F-1, as amended, declared effective by the SEC on September 19, 2000, and the other reports filed from time to time with the Securities and Exchange Commission. Reported results should not be considered an indication of future performance. You should not place undue reliance on these forward-looking statements, which speak only as the date hereof. ViryaNet disclaims any obligation to publicly update or revise any such forward-looking statements to reflect any change in our expectations or in events, conditions, or circumstances on which any such statements may be based, or that may affect the likelihood that actual results will differ from those set forth in the forward-looking statements.