TEK DigiTel Expands its Strategic Partnership with Arelnet Ltd.
Initial 2000 Unit Shipment of V-Server Products to be Completed in March 2001

GERMANTOWN, MD  -  March 29, 2001    TEK DigiTel Corp. (OTC Bulletin Board: TEKI - news) today announced that it has expanded the terms of its current relationship with Arelnet Ltd. with a focus on jointly securing significant VoIP business. Under the terms of the March 23, 2001 agreement, which is subject to approval by each party's Board of Directors, TEK is to ship 2000 V-Server units (mainly iPROs with a small number of iGATEs) to Arelnet by March 31, 2001. This memorandum of understanding (MOU) supersedes an earlier MOU with Arelnet Ltd. and provides for TEK to receive additional orders from Arelnet over the next three years. Arelnet's initial focus is on TEK's two-port iGATE and four-port iPRO, but the Agreement could also extend to future CPE products.

Pursuant to the terms of the Agreement, TEK will grant to Arelnet seven tranches of warrants to purchase common shares of the company based upon Arelnet's attainment of specified purchase order volumes, subject to a vesting schedule. If Arelnet submits cumulative purchase orders totaling 150,000 units over the next three years, Arelnet will be entitled to purchase 12M shares of TEK DigiTel's common stock at an average price of $1.17 per share representing total proceeds of approximately $14.04M to TEK. If Arelnet meets the purchase order volumes and exercises all the warrants, TEK may have to increase the company's number of authorized shares of common stock. In connection with the warrants, Arelnet was provided demand registration rights.

``We have taken our initial partnership with Arelnet to this heightened level as a result of our mutual commitment to aggressively pursue sales in the VoIP market worldwide,'' commented Thomas Yang, COO and Head of Sales and Marketing for TEK. ``To date, the companies have combined to bid on significant contracts across the globe that have seen our technologies compete alongside offerings from industry giants like Cisco. Arelnet's recent $10M order for Gateways and Gatekeepers from a South American subsidiary of a leading U.S.-based telecom carrier is a prime example of the opportunity available to the two companies.''

Terms of the initial MOU signed in October 2000 provided for the companies to jointly develop, market, distribute and sell full-scale global VoIP products. This current order for 2000 units validates the earlier MOU whereby Arelnet will market TEK's iPRO product under the I-Tone Primo brand name.

About TEK DigiTel Corporation (http://www.tekdigitel.com)

Based in Germantown, Maryland, TEK DigiTel Corporation delivers integrated CPE (Customer Premise Equipment) communications solutions optimized for use in SOHO, small- and medium-sized businesses. Working with Service Providers and OEM partners, TEK is focused on integrating fax- and Voice-over-IP (VoIP) technologies with conventional PBX systems and data routing devices to create a low-cost, easy-to-use Internet communications hub. Founded in 1998, TEK is headed by a management team with extensive related experience gained at leading manufacturers and service providers including IBM, Data General, Hughes, Orbital Communications, Bell Atlantic, and GTE.

Statements made in this press release that are not historical or current facts are ``forward-looking statements'' made pursuant to the safe harbor provisions of the Federal Securities Laws. Forward-looking statements represent management's best judgment as to what may occur in the future, but are subject to certain risks and uncertainties that could cause actual results and events to differ materially from those presently anticipated or projected.