Jean-Claude Martinez Confirmed as CEO of Esmertec; Senior Management Team Announces Measures

Jean-Claude Martinez has been an integral part of Esmertec sincehe joined the Company in June 2002 as Senior Vice President of Sales.In March 2004, he was appointed Chief Operating Officer, and from theend of 2005 until mid-May 2006, he focused on growing the business ofthe Mobile Operator Division worldwide. Hans-Ulrich Muller, ViceChairman of Esmertec's Board of Directors, comments, "Jean-Claude hasover 25 years of experience in the IT and telecommunications industryand is a hands-on manager who works closely with his team. The Boardis confident that he will lead Esmertec back to its growth path."

Reporting to Jean-Claude Martinez are Georges Boulloy as ChiefProduct Officer, Deborah Choate as Chief Financial Officer, SylvieVollet as General Counsel and VP of Human Resources, and Jean-LucGianduzzo as Executive Vice President (EVP) of Global Services.

The senior management team has taken the following actions toimprove operational efficiencies:

Global sales and service organization: This organization is nowstructured into a group focusing on sales and a group on services,thus removing one layer of management. The Services Group isresponsible for customer software and engineering projects, customersupport, mobile operator services, and specialized outsourcingservices for the mobile industry. This group will be led by Jean-LucGianduzzo, EVP of Global Services, who joined Esmertec on June 1,2006.

Mr. Gianduzzo has over 16 years of international experience inbusiness development and marketing of high-tech solutions andservices, and has been based in Switzerland for the past 10 years.Prior to Esmertec, Mr. Gianduzzo was CEO at NEXThink, and has heldsenior business development positions at Hewlett Packard and CiscoSystems Europe.

Following the disappointing sales performance and therestructuring of the sales and service organization, Billy Crotty, EVPSales and Operations Worldwide, left Esmertec on June 30, 2006.Esmertec is presently recruiting the EVP of Sales to lead the SalesGroup, and Jean-Claude Martinez will manage this position ad interim.

Cost reductions: Management has decided to close down Esmertec'ssubsidiary in Denmark and reduce significantly the operations inJapan. The company has assigned resources from other Esmertec'soffices and in Japan to continue supporting the products and customersin these regions.

Through the restructuring and other cost saving actions, Esmertecexpects to reduce its operating expenses by 15 to 20% from the currentrun rate, including investments in product development. The managementexpects to benefit from the full impact of the reduced costs beginningwith the fourth quarter of 2006. Pre-tax restructuring cash expenses,excluding any impact of impairment losses on intangible assets, areestimated to be in the range of US$2 million to US$2.5 million, andEsmertec expects to record most of the restructuring costs in the 2006first half-year results.

Esmertec will continue to invest in developing innovativeproducts, expanding its Java-based product portfolio and increasingits product offering to mobile operators through its productdevelopment operations in China, France, Switzerland, and in the UK.

The Company will host a conference call in English this afternoonat 1500hrs CET. Details on how to participate are posted on the"Investors/IR Agenda" section of www.esmertec.com. Financial resultsfor the six months ending June 30, 2006 will be announced by pressrelease at 0700hrs CET on August 30, 2006, and presented at amedia/analyst conference at 1000hrs CET in Zurich/Switzerland.

This communication contains forward-looking statements based oncurrent expectations and assumptions of the company's management only,and involve certain risks and uncertainties. The forward-lookingstatements contained herein could be substantially impacted by risksand influences that are not foreseeable at present, so that actualresults may vary materially from those anticipated, expected, orprojected. Esmertec disclaims any intention or obligation to updateand revise any forward-looking statements, whether as a result of newinformation, future events or otherwise.

About Esmertec

Esmertec is a leading provider of world-class software solutionsand services for telecommunication, interactive multimedia, andconsumer electronics markets. Engineered for smallness and massconsumption, Esmertec's wireless Java ME solutions and mobileapplications are developed to extract maximum performance fromhardware environments. Esmertec Cellicium's premier mobile browsingsolutions, applications and services are designed to bring interactivemobile services to mobile operators. Founded in 1999, Esmertec is aglobal company headquartered in Zurich-Switzerland with subsidiarieslocated in China, France, Japan, South Korea, and the USA, andrepresentative offices in Taiwan, South Korea and in the UK.www.esmertec.com

Esmertec and OSVM are trademarks of Esmertec AG.