Press Release

Bosnia Herzegovina Telecom Creates New Nationwide Broadband Network With Redback Next-Generation Platform Smart Broadband Network Plays Developmental Role in Post-War Rebuilding Effort for Consumers and Businesses

SAN JOSE, Calif., August 25, 2004 – Redback Networks Inc. (NASDAQ: RBAK), a leading provider of next-generation broadband networking systems, today announced that the Bosnia Herzegovina Telecom (d.d. BH Telecom-Sarajevo) is creating a new, integrated nationwide broadband and IP network. The network will bring ADSL broadband and IP access and services to the country, for the first time, as a part of its rebuilding effort after the war. With the SmartEdge® Service Gateway platform and NetOp™ Policy Manager from Redback Networks, Bosnia Telecom will create a Smart Broadband Network to meet the broadband needs of consumers and small-to-medium businesses, while at the same time providing leased line and frame relay termination and MPLS VPN services for larger companies.

“Broadband will play a critical role as the underlying infrastructure of Internet-enabled commerce, communications and delivery of content,” said Nedim Dzaferovic, director of data transfer directorate of d.d. BH Telecom Sarajevo. “The Redback platform will be an essential element of that infrastructure for us to meet current consumer and business needs and scale with great flexibility to meet the needs and opportunities of the future.”

“We are pleased to help BH Telecom in its rebuilding effort to create essential national infrastructure with a Smart Broadband Network that offers the reliability, flexibility and scalability to meet the demands of an emerging and quickly growing market,” said Marco Wanders, vice president of sales and operations for Europe, Middle East and Africa regions for Redback Networks. “BH Telecom has the vision, and now the infrastructure, to meet the challenges and opportunities of both today and tomorrow.”

Initially, BH Telecom will offer broadband and IP service within all larger city centers and then will extend the broadband network to all other urban and suburban parts of the country. Currently the country has dial-up and narrowband fixed-connection Internet service, but BH Telecom plans to build a world-class broadband network for all citizens in Bosnia and Herzegovina.

The Redback SmartEdge Service Gateway platforms integrate the B-RAS strength of Redback's industry-leading SMS™ family of subscriber management systems with the SmartEdge platform's purpose-built hardware and software to provide subscriber management with dynamic policy enforcement, carrier-class IP routing, ATM mediation, MPLS VPNs, multicast and advanced video capabilities and high performance Quality of Service (QoS).

About Redback Networks Redback Networks Inc., a leading provider of next-generation broadband networking equipment, enables carriers and service providers to build third-generation Smart Broadband Networks that can deliver simplified, personalized, portable subscriber services to consumers and businesses. The company's carrier-class, consumer-scale SmartEdge Router and Service Gateway platforms for Consumer IP combine subscriber management systems and edge routing and, in conjunction with the NetOp™ Element and Policy Manager platform, provide a powerful, flexible infrastructure for managing both subscribers and value-added services.

Founded in 1996 and headquartered in San Jose, Calif., with sales and technical support centers located worldwide, Redback Networks maintains a growing and global customer base of more than 500 carriers and service providers, including major local exchange carriers (LECs), inter-exchange carriers (IXCs), PTTs and service providers. For more information, visit Redback Networks at www.redback.com.

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REDBACK and SmartEdge are trademarks registered at the U.S. Patent and Trademark Office and in other countries. SMS and NetOp are trademarks of Redback Networks Inc. All other products or services mentioned are the trademark, service marks, registered trademarks or registered service marks of their respective owners.

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 Redback Network’s expectations, beliefs, intentions or strategies regarding the future and including, without limitation, statements regarding BH Telecom’s ability to build and operate a Smart Broadband Network for business and consumer IP services, whether the Redback platform will be an essential element in Bosnia Herzegovina’s DSL infrastructure and the ability of the Redback platform to perform and provide the necessary flexibility, performance and scalability. All forward-looking statements included in this document are based upon information available to Redback Networks as of the date hereof, and Redback Networks 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 risks and other risks relating to Redback Network’s business are set forth in the documents filed by Redback Networks with the Securities and Exchange Commission (SEC), specifically the most recent report on Form 10-K Form, Form 10-Q, Form 8-K, Redback’s Registration Statement on Form S-3 (File No. 333-114352), and amendments thereto, and the other reports filed from time to time with the SEC.