**For
      Further Information Contact:**


Bert
      Williams


Vice
      President, Marketing and Investor Relations


(408)
      731-2610








**TERABEAM
      TO CHANGE CORPORATE NAME TO PROXIM WIRELESS**





*New
      Ticker Symbol to be “PRXM”*





**San
      Jose, CA, September 4, 2007 –**Terabeam, Inc. (NASDAQ:TRBM), a leader in
      core-to-client solutions for broadband municipal wireless networks, today
      announced that it will change its corporate name to “Proxim Wireless
      Corporation,” the current name of its largest operating unit.





In
      connection with the name change, the company will also change its ticker symbol
      from “TRBM” to “PRXM.”  The company’s stock will continue to trade on
      the Nasdaq Capital Market.





These
      changes will be made prior to the open of markets on Monday, September 10,
      2007.  The company will continue to be known as Terabeam, Inc. and its
      ticker symbol will remain “TRBM” through the close of markets on Friday,
      September 7, 2007.





“As
      well
      as being our go-to-market brand, the Proxim Wireless name has been synonymous
      with innovative wireless networking solutions for many years,” said Robert
      Fitzgerald, Chief Executive Officer. “With the recent divestiture of our
      Ricochet service business and the extent to which the name Proxim is recognized
      as a pioneer and leader in wireless networking solutions, we feel that the
      time
      is right to name our corporate parent Proxim Wireless.”





The
      company’s capital stock and business and operations will not be affected by this
      name change. No vote of the company’s stockholders is necessary in connection
      with these changes.  The company’s stockholders will not be required
      to exchange their Terabeam stock certificates for Proxim Wireless stock
      certificates.  The Terabeam stock certificates will continue to
      represent shares of stock of the company.  Stockholders who receive
      stock certificates after September 10 will receive new Proxim Wireless stock
      certificates.  After September 10, stockholders with Terabeam stock
      certificates may exchange those certificates for Proxim Wireless stock
      certificates through the company’s transfer agent, Registrar and Transfer
      Company, if they so desire.





**About
      Terabeam**


Terabeam,
      Inc. is a leader in core-to-client solutions for broadband municipal wireless
      networks. The company’s business is conducted primarily through its Proxim
      Wireless Corporation subsidiary. Our systems enable a variety of wireless
      applications including security and surveillance systems, mobile workforce
      automation and machine-to-machine communications. We have shipped more than
      1.5
      million wireless devices to more than 200,000 customers worldwide. Additional
      information about the company can be found at the company’s website located at
www.terabeam.com or by contacting the company by telephone at
      408-731-2610 or by email at IR@terabeam.com.









Terabeam
        to Change Corporate Name to Proxim Wireless
 September
        4, 2007
 Page
        2






***Safe
      Harbor Statement***


*Statements
      in this press release that are not statements of historical facts are
      forward-looking statements that involve risks, uncertainties, and
      assumptions.  Terabeam’s actual results may differ materially from the
      results anticipated in these forward-looking statements.  The
      forward-looking statements involve risks and uncertainties that could contribute
      to such differences including those relating to and arising from the ongoing
      uncertainty in the telecommunications industry and larger economy; the intense
      competition in our industries and resulting impacts on our pricing, gross
      margins, and general financial performance; difficulties or delays in developing
      and supplying new products with the contemplated or desired features,
      performance, compliances, certifications, cost, price, and other characteristics
      and at the times and in the quantities contemplated or desired, which
      difficulties may be exacerbated by our recent cost savings initiatives;
      uncertainty about market acceptance of products we introduce; potential long
      sales cycles for new products such that there may be extended periods of time
      before new products contribute positively to our financial results; decisions
      we
      may make to delay or discontinue efforts to develop and introduce certain new
      products; time, costs, political considerations, typical multitude of
      constituencies, and other factors involved in evaluating, equipping, installing,
      and operating municipal networks; difficulties in predicting Terabeam’s future
      financial performance; and the impacts and effects of any other strategic
      transactions Terabeam may evaluate or consummate.  Further information
      on these and other factors that could affect Terabeam’s actual results is and
      will be included in filings made by Terabeam from time to time with the
      Securities and Exchange Commission and in its other public
      statements.*