BluePhoenix Successfully Migrates Billing System as Part of Multi-Million Dollar Modernization Project for Israel Local Authorities


System Goes Live; Migration From ADABAS/Natural to Java/J2EE Will Improve Profitability, Productivity, Efficiency and Reduce TCO by 40%

HERZLIYA, Israel, June 26/- BluePhoenix Solutions (NASDAQ: BPHX), the leader in value-driven legacy modernization, today announced that Israel Local Authorities Data Processing Center (LADPC) has gone live with a successfully migrated billing system, part of a multi-million dollar modernization project involving billing, finance, human resource and payroll applications.

The $2.25-million modernization project is a component of LADPC's $6.7-million service bureau upgrade undertaken at its service bureau and its municipalities. The LADPC provides IT services to more than 250 of Israel's municipal authorities, serving more than 5,000 users.

The modernization of LADPC's legacy billing system to open systems will increase profitability and provide significant cost savings by enabling LADPC to run the application solely on a UNIX server instead of bearing the higher costs associated with mainframe maintenance and licensing fees. LADPC estimates that total cost of ownership will decrease by 40% and the project's payback period will be less than two years. In addition, LADPC will employ Oracle RDBMS and JAVA instead of the costly and less flexible ADABAS/Natural.LADPC also expects to realize substantial savings on manpower training associated with its legacy billing system.

The modernized billing application will improve the services LADPC offers to its clients, provide a Web-based graphical user interface to increase usability, and enable it to offer new services, such as sophisticated reporting capabilities.

According to Gilad Rabinovich, CEO of LADPC, "We were extremely pleased at both the short duration and smooth transition of the migration project and anticipate a rapid return on our investment. We were fortunate to work with BluePhoenix, which offers the only fully automated conversion solution to migrate our legacy environment to Java/J2EE."

The project was performed using BluePhoenix IT Discovery, BluePhoenixDBMSMigrator for ADABAS/Natural and BluePhoenixPlatformMigrator tools.

"We're excited about this significant milestone," said Arik Kilman, CEO
for BluePhoenix. "The LADPC project highlights our ability to rapidly
modernize a wide range of legacy systems to newer platforms, databases and
languages. We look forward to working with LADPC to achieve a successful
completion of the remaining portions of this project."

About LADPC

Israel Local Authorities Data Processing Center was established in 1968
by the Ministry of Interior and the Union of Local Authorities. It operates
as a public company, with the local authorities owning 60% and the Government
of Israel owning 40% of the founding shares. Offering the most comprehensive,
integrative computer networking system in Israel, the company is dedicated to
improving the efficiency and productivity of the country's local authorities.
The LADPC serves over 5,000 users connected by over a 150 nodes' network. It
provides real time service information from four central offices - located in
Tel Aviv, Jerusalem, Beersheba and Haifa. LADPC provides all 263 of Israel's
municipal authorities with a range of services including: HR and Salary
services, Finance services, Billing services as well as tools for population
management, online access to Government Ministries and banks, and joint
operations with municipal staff.

About BluePhoenix Solutions (www.bphx.com)

BluePhoenix Solutions (NASDAQ: BPHX) is a leading provider of value
driven modernization solutions for legacy information systems. BluePhoenix's
offering includes a comprehensive suite of tools and services from global IT
asset assessment and impact analysis to automated database and application
migration, rehosting and renewal. Leveraging over twenty years of best
practice domain expertise, BluePhoenix works closely with its customers to
ascertain which assets should be migrated, redeveloped or wrapped for reuse
as services or business processes, to protect and increase the value of their
business applications and legacy systems with minimized risk and downtime.

BluePhoenix's solutions serves companies from diverse industries and
vertical markets such as automotive, banking and financial services,
insurance, manufacturing and retail. Among its prestigious customers are:
Aflac, DaimlerChrysler, Danish Commerce and Companies Agency, Europe
Assistance, Lawson Products, Los Angeles County Employees Retirement
Association, Merrill Lynch, SDC Udvikling and TEMENOS. BluePhoenix has 13
offices in the U.S., UK, Denmark, Germany, Italy, Romania, Russia, Cyprus and
Israel.

Source: BluePhoenix Solutions Ltd.

Company Contact: David Leichner, BluePhoenix Solutions, +972-9-952-6105, dleichner@bphx.com

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