Xten Networks, Inc. Announces Filing of Quarterly Report

120% Revenue Increase Over Quarter ended April 30, 2004

Santa Clara, CA — September 14, 2004 —

Xten (OTCBB: XNWK), a provider of SIP-based video and voice over IP softphones and software, today reported record revenues for the quarter ended July 31, 2004 of $487,151 compared to $219,021 for the quarter ended July 31, 2003 and $221,203 for the quarter ended April 30, 2004.

The Company's Quarterly Report on Form 10-QSB including consolidated balance sheet and statement of operations for the first quarter of fiscal 2005 - the three month period ended July 31, 2004 - was filed and is available for viewing at www.sec.gov.

"We are very excited by our rapid improvement with 120% quarter-to-quarter sales growth and anticipate our growth will continue through fiscal 2005," said Mark Bruk, chief executive officer of Xten Networks, Inc. "With product now in 14 countries, we continue to increase our market share," added Bruk.

For the quarter ending July 31, 2004 - the Company reported revenues of $487,151 compared to $219,021 for the three months ending July 31, 2003. The net loss for the three months ending July 31, 2004 was $191,133 compared to $71,084 for the three months ending July 31, 2003. During the period, the Company disposed of its wholly-owned subsidiary Broad Scope Enterprises, Inc. to a former director of the Company in consideration of Broad Scope forgiving all amounts owed by the Company.

About Xten Networks, Inc.

Xten is a developer of award-winning, high-quality, carrier-grade VoIP (Voice over IP) and Video over IP SIP softphones for service providers, cable operators, Internet telephony service providers, IP PBX manufacturers and OEMs. Xten has a feature-rich FREE SIP softphone dubbed X-Lite, in addition to the fully featured X-PRO commercial softphone and eyeBeam, a SIP Video over IP softphone. Through its deployments with leading service providers, Xten has more than 500,000 IP endpoints deployed worldwide. For more information please visit www.xten.com. You may also visit Xten COO, Erik Lagerway's blog at www.sipthat.com.