Summary Operating Results:

* Non-GAAP measure: earnings (loss) before stock based compensation, amortization of acquired intangibles, interest and income taxes. This measure may not be comparable to similar measures used by other companies.

** Includes $1.2 million provision for potential contract losses.

OTTAWA, Ontario, August 27, 2008 –– March Networks^TM (TSX:MN), a leading provider of innovative video and data applications used for security surveillance, monitoring, analysis and business optimization, today announced financial results for the first quarter ended July 31, 2008. All figures in Canadian dollars and in accordance with Canadian GAAP unless otherwise specified.

The Company achieved record revenue of $27.8 million in the first quarter of fiscal 2009 representing an increase of 13% as compared to revenue of $24.5 million in the first quarter of fiscal 2008 and an increase of 32% as compared to the fourth quarter of fiscal 2008.

Non-GAAP operating earnings for the quarter reflected a loss of $1.2 million which represents a $2.9 million improvement from the $4.1 million loss incurred in the fourth quarter of fiscal 2008 and a $2.1 million decline from operating earnings of $945,000 in the first quarter of fiscal 2008. The Company’s first quarter fiscal 2009 operating earnings include a $1.2 million provision for contract losses on passenger rail projects that will be delivered over fiscal years 2009 through 2015. Negotiations continue with the customer to mitigate these losses.

The Company incurred a net loss in the first quarter of fiscal 2009 of $2.4 million or $0.14 per diluted share as compared to a net loss of $3.1 million or $0.18 per diluted share in the fourth quarter of fiscal 2008 and net earnings of $374,000 or $0.02 per share in the first quarter of fiscal 2008.

“Q1 was great start to the fiscal year highlighted by exceptional global growth and continued diversification of our customer base” said Peter Strom, President and Chief Executive Officer.

Financial Highlights

• Revenue excluding the Company’s largest customer was up 57% as compared to the first quarter of fiscal 2008 and 28% as compared to the fourth quarter of fiscal 2008.
• Record level of international revenue representing 35% of total revenue as compared to 16% in the same quarter last fiscal year.
• Operating earnings improved by 72% as compared to the fourth quarter of fiscal 2008.
• Company repurchased over 600,000 common shares to date under the Normal Course Issuer Bid at an average price of approximately $4.84 per share.

“The Company‘s first quarter results are an early indication that the Company is on track to achieving its revenue and operating cost structure objectives for fiscal 2009", said Ken Taylor, CFO of March Networks. “The Company is addressing a lower than expected Q1 gross margin level with product cost reduction initiatives and has recently completed a staff reduction to keep the Company in line with its operating earnings expectations.”

Business Outlook

The Company’s revenue expectations for the fiscal year ending April 30, 2009 are in the range of $100 million to $115 million.

The Company’s expectations of operating earnings for fiscal 2009 are in the range of $0.5 million to $5 million. Operating earnings is a non-GAAP measure that the Company uses to evaluate its performance in order to emphasize cash flow impacting operating activities. The Company defines this measure as earnings before interest, taxes, amortization of acquired intangibles and stock based compensation expense. This measure may not be comparable to similar measures used by other companies.

The Company will release its first quarter of fiscal 2009 financial results on August 27, 2008 and will discuss the results on a conference call and webcast on August 28, 2008 at 8:30 a.m. EDT (1:30 p.m. GMT). The conference call may be accessed by dialing 1-800-732-9303 (North America) or 00 800 2288 3501 (Europe).

The conference call webcast can be accessed at http://www.newswire.ca/en/webcast/viewEvent.cgi?eventID=2386120

A replay of the conference call will be available from August 28, 2008 at 10:30 a.m. EDT until September 4, 2008 at 11:59 p.m. EDT. The replay can be accessed at 1-877-289-8525 or 416-640-1917. The passcode for the replay is 21280761#

About March Networks
March Networks™ (TSX:MN) is a leading provider of intelligent IP video and business analysis applications that enable organizations to reduce losses, mitigate risks and improve security and operational efficiency. The Company’s advanced software suite includes enterprise-class video management, powerful analytics and comprehensive managed and professional services. Our software and systems are used by leading financial institutions, retailers, transportation authorities and other organizations in more than 50 countries. For more information, please visit www.marchnetworks.com.

Forward-Looking Statements
Certain statements included in this release constitute forward-looking statements, including those identified by the expressions "anticipate", "believe", "plan", "estimate", "expect", "intend" and similar expressions to the extent they relate to the Company or its management. The forward-looking statements are not historical facts but reflect the Company's current assumptions and expectations regarding future results or events. These forward-looking statements are subject to a number of risks and uncertainties that could cause actual results or events to differ materially from current assumptions and expectations.

Assumptions made in preparing the forward-looking statements and financial guidance contained in this release include, but are not limited to, the following:

• The market for the Company’s products will grow by greater than 10% annually.
• The Company’s revenue concentration with any end user customer will not exceed 10% in fiscal 2009.
• The Company will develop and deliver new products on time in order to satisfy the demands of current and potential customers.
• The Company will have adequate component supply to meet customer demand.
• The Company’s gross margin as a percentage of revenue in fiscal 2009 will improve relative to fiscal 2008.
• The Company will lower its operating cost structure as a percentage of revenue relative to fiscal 2008.
• The prevailing exchange rate for US dollars and Euros to Canadian dollars will be US$1.00=CDN$1.00 and Euro 1=CDN$1.50.
• The Company will continue to demonstrate its potential to generate sufficient profits in future fiscal years to realize the value of its future tax assets.

Factors that could cause actual results to differ materially from expected results include, but are not limited to, the following:

• Higher than targeted product costs and/or higher than expected declines in market pricing for the Company’s products.
• Delays in product development programs for new products and new product features which lead to cost overruns and /or missed customer opportunities.
• Weaker than expected success versus competitors in new customer opportunities and/or loss of existing customers to competitors.
• Revenue shortfalls due to delays in securing new customer opportunities and the lack of long term purchase commitments from customers.
• Slower than expected customer adoption of the Company’s new product and service offerings.
• Product issues that result in increased costs to the Company and/or lost revenue opportunities.
• Difficulties integrating acquired business operations and related diversion of management attention.
• Reduced customer spending associated with the impact of deteriorating economic conditions and increasing fuel prices.

Additional risks are discussed under "Risk Factors" in the Company’s Annual Information Form available online at www.sedar.com.

*MARCH NETWORKS and the MARCH NETWORKS logo are trademarks of March Networks Corporation. All other trademarks are the property of their respective owners.

For further information, please contact:
March Networks Corporation
Peter Wilenius
VP Corporate Development
(613) 591-8181
pwilenius@marchnetworks.com

March Networks Corporation

(Canadian dollars, amounts in thousands, except share and per-share data)
(Unaudited)

March Networks Corporation

(Canadian dollars, amounts in thousands)
(Unaudited)

March Networks Corporation

(Canadian dollars, amounts in thousands)
(Unaudited)