<PAGE>

                     U.S. SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON, DC 20549

                                   FORM 10-QSB

     (Mark One)

     |X| Quarterly report under Section 13 or 15(d) of the Securities Exchange
         Act of 1934 for the quarterly period ended October 2, 1998

     |_| Transition report under Section 13 or 15(d) of the Securities Exchange
         Act of 1934 for the transition period from _________ to ___________

                      Commission File Number: 000-21415

                            WHITE PINE SOFTWARE, INC.
           (Name of Small Business Issuer as Specified in Its Charter)

             Delaware                                             04-3151064
 (State or Other Jurisdiction of                               (I.R.S. Employer
  Incorporation or Organization)                             Identification No.)


                 542 Amherst Street, Nashua, New Hampshire 03063
                    (Address of Principal Executive Offices)

                                 (603) 886-9050
                (Issuer's Telephone Number, Including Area Code)

Check whether the issuer: (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter
period that the registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days. Yes |X| No |_|

A total of 10,322,160 shares of the Registrant's common stock were outstanding
as of November 10, 1998.

Transitional Small Business Disclosure Format (check one):  Yes  |_|   No |X|


<PAGE>



                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                                                               Page
                                                                                                               ----
<S>                                                                                                           <C>  

                          PART I. FINANCIAL INFORMATION

Item 1. Financial Statements (Unaudited)

         Condensed Consolidated Balance Sheets as of October 2, 1998 and
         December 31, 1997......................................................................................3

         Condensed Consolidated Statements of Income for the three and
         nine months ended October 2, 1998 and October 3, 1997..................................................4

         Condensed Consolidated Statements of Cash Flows for the nine
         months ended October 2, 1998 and October 3, 1997.......................................................5

         Note to Condensed Consolidated Financial Statements....................................................6

Item 2. Management's Discussion and Analysis or Plan of Operation...............................................8


                                            PART II. OTHER INFORMATION

Item 1. Legal Proceedings......................................................................................15

Item 6. Exhibits and Reports on Form 8-K.......................................................................16

Signatures.....................................................................................................17
</TABLE>

                                                   2


<PAGE>



                                           PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

                            WHITE PINE SOFTWARE, INC. AND SUBSIDIARY
                       CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)
                                      (in thousands)

<TABLE>
<CAPTION>
                                                                                  October 2,        December 31,
                                                                                     1998               1997
                                                                               ----------------   -----------------
<S>                                                                            <C>                <C>
Assets
    Current assets:
        Cash and cash equivalents..............................................        $  8,247             $14,704
        Accounts receivable, net...............................................           1,836               2,403
        Inventories............................................................              60                  98
        Prepaid expenses and other current assets..............................           1,080               1,378
                                                                                       -------              -------
           Total current assets................................................          11,223              18,583
    Property and equipment, net................................................           4,079               1,514
    Third party licenses, net..................................................             684                 669
    Goodwill, net..............................................................             497                 676
    Other long term assets.....................................................             177                 168
                                                                                       -------              -------
Total assets...................................................................         $16,660             $21,610
                                                                                       -------              -------
                                                                                       -------              -------

Liabilities and stockholders' equity 
    Current liabilities:
        Accounts payable and accrued expenses..................................        $  2,216            $  2,550
        Deferred revenue.......................................................             211                 246
        Current portion of long-term debt .....................................              11                  55
                                                                                       -------              -------
           Total current liabilities...........................................           2,438               2,851
    Long term debt, net of current portion.....................................              26                  33
Total stockholders' equity.....................................................          14,196              18,726
                                                                                       -------              -------
Total liabilities and stockholders' equity.....................................         $16,660             $21,610
                                                                                       -------              -------
                                                                                       -------              -------
</TABLE>

                See Note to Condensed Consolidated Financial Statements


                                                   3

<PAGE>



                           WHITE PINE SOFTWARE, INC. AND SUBSIDIARY
                      CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
                           (in thousands, except per share data)

<TABLE>
<CAPTION>

                                                      Three Months Ended                 Nine Months Ended
                                               --------------------------------- ----------------------------------
                                                  October 2,       October 3,       October 2,        October 3,
                                                     1998             1997             1998              1997
                                               ---------------- ---------------- ----------------  ----------------
<S>                                            <C>               <C>             <C>               <C>
Revenue:
    Software license fees......................$          1,761  $         2,534  $         5,034   $         7,108
    Services and other.........................             173              338              607               989
                                               ---------------- ----------------  ---------------  ----------------
        Total revenue..........................           1,934            2,872            5,641             8,097
Cost of revenue................................             373              343            1,093             1,363
                                               ---------------- ---------------- ----------------  ----------------
Gross profit...................................           1,561            2,529            4,548             6,734
Operating expenses:
    Sales and marketing........................           1,719            1,810            5,675             5,895
    Research and development...................           1,244            1,298            3,855             4,545
    General and administrative.................             590              519            1,860             2,073
    Restructuring..............................               -                -                -               661
                                               ---------------- ---------------- ----------------  ----------------
        Total operating expenses...............           3,553            3,627           11,390            13,174
                                               ---------------- ---------------- ----------------  ----------------
Loss from operations...........................          (1,992)          (1,098)          (6,842)           (6,440)
Other income (expense):
    Interest income (expense)..................             132              236              489               819
    Other, net ................................             (29)              (6)             (55)              (76)
                                               ---------------- ---------------- ----------------  ----------------
                                                            103              230              434               743
Net loss before provision for income taxes.....          (1,889)            (868)          (6,408)           (5,697)
Provision for income taxes.....................               -                7                5                 7
                                               ---------------- ---------------- ----------------  ----------------
Net loss.......................................$         (1,889)  $         (875)  $       (6,413)    $      (5,704)
                                               ---------------- ---------------- ----------------  ----------------
                                               ---------------- ---------------- ----------------  ----------------
Net loss per share:
    Basic......................................$          (0.18)  $        (0.10)  $        (0.67)    $       (0.63)
                                               ---------------- ---------------- ----------------  ----------------
                                               ---------------- ---------------- ----------------  ----------------
    Diluted....................................$          (0.18)  $        (0.10)  $        (0.67)    $       (0.63)
                                               ---------------- ---------------- ----------------  ----------------
                                               ---------------- ---------------- ----------------  ----------------
Weighted average number of common and
common equivalent shares outstanding...........      10,223,672        9,168,921        9,621,000         9,107,338
                                               ---------------- ---------------- ----------------  ----------------
                                               ---------------- ---------------- ----------------  ----------------
</TABLE>


               See Note to Condensed Consolidated Financial Statements

                                                   4

<PAGE>



                        WHITE PINE SOFTWARE, INC. AND SUBSIDIARY
              CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
                                 (in thousands)

<TABLE>
<CAPTION>
                                                                                            Nine Months Ended
                                                                                            -----------------
                                                                                     October 2,          October 3,
                                                                                        1998                1997
                                                                                     ------------         ----------
<S>                                                                                  <C>                  <C>
Operating activities
Net loss.........................................................................       $   (6,413)        $    (5,704)
Adjustments to reconcile net loss to net cash used in
  operating activities:
     Depreciation................................................................              414                 334
     Amortization of goodwill and third-party licenses...........................              380                 511
     Provision for bad debts.....................................................               36                 (45)
     Changes in operating assets and liabilities:
         Accounts receivable.....................................................              531                 610
         Inventories.............................................................               39                  22
         Prepaid expenses........................................................              284              (1,328)
         Other assets............................................................               11                 (55)
         Accounts payable and accrued expenses...................................             (368)                (81)
         Deferred revenue........................................................              (40)               (541)
                                                                                 ------------------  ------------------
Net cash used in operating activities............................................           (5,126)             (6,277)
Investing activities.............................................................
Purchase of property and equipment, net..........................................           (2,969)               (595)
Purchase of third-party licenses, net............................................             (216)               (384)
                                                                                 ------------------  ------------------
Net cash used in investing activities............................................           (3,185)               (979)

Financing activities
Principal payments on long-term debt.............................................              (52)               (215)
Proceeds from common stock issued upon exercise
  of stock options...............................................................               57                 216
Proceeds from common stock issued under
  Employee Stock Purchase Plan...................................................               39                   -
Market value of common stock issued upon purchase
  of intangible assets...........................................................            1,828                   -
                                                                                 ------------------  ------------------
Net cash provided by financing activities.......................................             1,872                   1
Currency translation effect on cash and cash equivalents.........................              (18)                (24)
                                                                                 ------------------  ------------------
Net decrease in cash and cash equivalents........................................           (6,457)             (7,279)
Cash and cash equivalents at beginning of period.................................           14,704              23,298
                                                                                 ------------------  ------------------
Cash and cash equivalents at end of period.......................................        $   8,247          $   16,019
                                                                                 ------------------  ------------------
                                                                                 ------------------  ------------------
</TABLE>

               See Note to Condensed Consolidated Financial Statements

                                                   5


<PAGE>

                    WHITE PINE SOFTWARE, INC. AND SUBSIDIARY
          NOTE TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
                              October 2, 1998

1.   Accounting Policies

     Description of Business

     The Company develops, markets and supports multiplatform desktop 
multimedia software that facilitates worldwide video and audio communication 
and data collaboration across the Internet, intranets and other networks that 
use the Internet Protocol ("IP"). The Company's desktop videoconferencing 
software products, CU-SeeMe and MeetingPoint, create a client-server solution 
that allows users to participate in real-time, multipoint videoconferences 
over the Internet and intranets. In November 1997, the Company began 
commercial shipments of MeetingPoint, the first multimedia conferencing 
server software to implement the ITU H.323 standard for conferencing over 
packet networks. MeetingPoint enables any standards-based client to 
participate in full multipoint group conferences. Further building upon the 
core CU-SeeMe and MeetingPoint technologies, the Company developed 
ClassPoint, an integrated vertical solution for distance learning and 
distance training, which began shipping commercially in April 1998. In 
September 1998, the Company released MeetingPoint version 3.5, which includes 
new features for audio mixing and video switching, as well as improvements in 
interoperability and in conference administration capabilities for 
scheduling, bandwidth management and security. The Company also offers 
desktop X Windows and terminal emulation software. The Company's customers 
include businesses, educational institutions, government organizations and 
individual consumers. The Company markets and sells its products in the 
United States, Canada, Europe and the Pacific Rim through distributors, a 
combination of strategic partners and OEMs, and its direct sales 
organization, as well as over the Internet. The Company was incorporated in 
April 1992.

     Principles of Consolidation

     The consolidated financial statements include the accounts of the 
Company and its wholly owned foreign subsidiary, White Pine Software, Europe. 
All significant intercompany accounts and transactions have been eliminated 
in consolidation.

     Cash and Cash Equivalents

     Cash and cash equivalents consist of cash on hand and investments in 
high grade commercial paper having maturities of three months or less when 
purchased. Commercial paper qualifying as cash equivalents totaled $7,401,000 
and $13,440,000 at October 2, 1998 and December 31, 1997, respectively. These 
investments have been categorized as held to maturity under the provisions of 
Statement of Financial Accounting Standards No. 115, Accounting for Certain 
Investments in Debt and Equity Securities. Accordingly, the balances are 
stated at amortized cost, which approximates fair value because of the short 
maturity of these instruments.

     Revenue Recognition

     The Company's revenue is derived from software license fees and fees for 
services related to its software products, primarily software maintenance 
fees. The Company's revenue recognition practices were substantially in 
compliance with the provisions of AICPA Statement of Position No. 97-2, 
Software Revenue Recognition, at the time of adoption on January 1, 1998.


                                   6
<PAGE>

     Software license revenue is recognized upon receipt of a firm customer 
order and shipment of the software, net of allowances for estimated future 
returns, provided that no significant obligations remain on the part of the 
Company and collection of the related receivable is deemed probable. Revenue 
under certain license agreements is recognized upon execution of a signed 
contract and fulfillment of the contractual obligations, provided that no 
significant obligations remain on the part of the Company and collection is 
deemed probable.

     Software maintenance fees, which generally are payable in advance and 
are non-refundable, are recognized ratably over the period of the maintenance 
contract, typically twelve months. Revenue from training and consulting 
services is recognized as services are provided.

     Deferred revenue consists of software license fees, consulting fees and 
training fees that have been prepaid or invoiced but that do not yet qualify 
for recognition as revenue under the Company's policy, as well as prepaid 
maintenance fees not yet recognized as revenue.

     Loss per Share

     In 1997, the Financial Accounting Standards Board issued Statement of 
Financial Accounting Standards No. 128, "Earnings per Share" ("SFAS 128"). 
SFAS 128 replaced the calculation of primary and fully diluted earnings per 
share with basic and diluted earnings per share. Unlike primary earnings per 
share, basic earnings per share excludes any dilutive effects of options, 
warrants and convertible securities. Diluted earnings per share is very 
similar to the previously reported fully diluted earnings per share. Pursuant 
to the previous requirements of the Securities and Exchange Commission (the 
"SEC"), common shares and common share equivalents issued by the Company 
during the twelve-month period prior to the initial public offering of the 
Company's common stock had been included in the calculations as if they were 
outstanding for all periods prior to the offering in August 1996 whether or 
not they were anti-dilutive. In February 1998, the SEC issued Staff 
Accounting Bulletin 98 which, among other things, conformed prior SEC 
requirements to SFAS 128 and eliminated inclusion of such shares in the 
computation of earnings per share. All earnings per share amounts for all 
periods have been presented, and where appropriate, restated to conform to 
SFAS 128 and SEC requirements.

     Basic net loss per common share is computed using the weighted average 
number of shares of common stock outstanding during the period. Diluted net 
loss is computed using the weighted average number of shares of common stock 
and dilutive common equivalent shares outstanding during the period. Common 
equivalent shares consist of the incremental common shares issuable upon the 
exercise of stock options and warrants using the treasury stock method.


                                   7

<PAGE>

Item 2. Management's Discussion and Analysis or Plan of Operation

     THIS FORM 10-QSB CONTAINS "FORWARD-LOOKING STATEMENTS" WITHIN THE 
MEANING OF SECTION 27A OF THE SECURITIES ACT OF 1933 AND SECTION 21E OF THE 
SECURITIES EXCHANGE ACT OF 1934. ANY STATEMENTS CONTAINED HEREIN THAT ARE NOT 
STATEMENTS OF HISTORICAL FACT MAY BE DEEMED TO BE FORWARD-LOOKING STATEMENTS. 
WITHOUT LIMITING THE FOREGOING, THE WORDS "BELIEVES," "ANTICIPATES," "PLANS," 
"EXPECTS" AND SIMILAR EXPRESSIONS ARE INTENDED TO IDENTIFY FORWARD-LOOKING 
STATEMENTS. THE FORWARD-LOOKING STATEMENTS INVOLVE KNOWN AND UNKNOWN RISKS, 
UNCERTAINTIES AND OTHER FACTORS THAT MAY CAUSE THE ACTUAL RESULTS, 
PERFORMANCE AND ACHIEVEMENTS OF WHITE PINE SOFTWARE, INC. TO DIFFER 
MATERIALLY FROM THOSE INDICATED BY THE FORWARD-LOOKING STATEMENTS, INCLUDING 
(a) THE COMPANY'S HISTORICAL AND CONTINUING OPERATING LOSSES, (b) THE 
COMPANY'S RELIANCE ON ITS UNPROVEN PRODUCTS, MEETINGPOINT AND CLASSPOINT, 
THAT WERE INTRODUCED RELATIVELY RECENTLY, (c) SIGNIFICANT AND INCREASING 
COMPETITION, INCLUDING COMPETITION FROM FREE VIDEOCONFERENCING CLIENT 
SOFTWARE SUCH AS MICROSOFT CORPORATION'S NETMEETING, (d) POTENTIAL 
FLUCTUATIONS IN QUARTERLY RESULTS OF OPERATIONS, (e) RELIANCE ON TWO 
SIGNIFICANT DISTRIBUTORS OF THE COMPANY'S SOFTWARE PRODUCTS, (f) DEPENDENCE 
UPON TECHNOLOGY LICENSED UNDER AN AGREEMENT WITH THE CORNELL RESEARCH 
FOUNDATION, INC. AND (g) THE OTHER FACTORS DESCRIBED UNDER "ITEM 1A. Risk 
Factors" IN THE COMPANY'S ANNUAL REPORT ON FORM 10-KSB FOR THE YEAR ENDED 
DECEMBER 31, 1997, A COPY OF WHICH ITEM IS INCLUDED AS AN EXHIBIT TO THIS 
FORM 10-QSB AND IS INCORPORATED HEREIN BY REFERENCE.

OVERVIEW

     The Company develops, markets and supports multi-platform desktop 
multimedia software that facilitates worldwide video and audio communication 
and data collaboration across the Internet, intranets and other networks 
using IP. The Company's desktop videoconferencing software products, CU-SeeMe 
and MeetingPoint, create a client-server solution that allows users to 
participate in real-time, multipoint videoconferences over the Internet and 
intranets. In November 1997, the Company began commercial shipments of 
MeetingPoint, the first multimedia conferencing server software to implement 
the ITU H.323 standard for conferencing over packet networks. MeetingPoint 
enables any standards-based client to participate in full multipoint group 
conferences. Further building upon the core CU-SeeMe and MeetingPoint 
technologies, the Company developed ClassPoint, an integrated vertical 
solution for distance learning and distance training, which began shipping 
commercially in the last week of April 1998. In September 1998, the Company 
released MeetingPoint version 3.5, which includes new features for audio 
mixing and video switching, as well as improvements in interoperability and 
in conference administration capabilities for scheduling, bandwidth 
management and security. The Company also offers desktop X Windows and 
terminal emulation software.

     In June 1995, as a part of its continuing plan to focus on software 
connectivity products, the Company entered into the License Agreement with 
the Cornell Research Foundation, Inc. (the "Cornell Foundation"), which 
granted to the Company the exclusive worldwide right to develop, modify, 
market, distribute and sublicense commercial versions of Freeware CU-SeeMe 
and its related software-only multipoint conferencing server. The Company 
commenced shipments of the initial commercial versions of CU-SeeMe and the 
White Pine Reflector (the predecessor of MeetingPoint) in March 1996 and May 
1996, respectively. 

                                   8

<PAGE>

The Company anticipates that its revenue growth, if any, will depend on 
increased sales of MeetingPoint and other multimedia server solutions, such 
as ClassPoint. Accordingly, the Company intends to continue to devote a 
substantial portion of its research and development and sales and marketing 
resources to technologies related to group conferencing. On May 22, 1997, the 
Company renegotiated the terms of its License Agreement with the Cornell 
Foundation. The principal changes to the agreement were a $1,000,000 
prepayment of royalties by the Company to the Cornell Foundation and a 
decrease in the revenue-based royalties. The renegotiated terms were 
retroactive to January 1, 1997. The Company is still subject to minimum 
royalty payments.

     The Company's revenue is derived from software license fees and fees for 
services related to its software products, primarily software maintenance 
fees. During fiscal 1997, the Company recognized revenue in accordance with 
the American Institute of Certified Public Accountants Statement of Position 
No. 91-1, "Software Revenue Recognition." For fiscal 1998, the Company is 
recognizing revenue in accordance with AICPA Statement of Position 97-2, 
"Software Revenue Recognition." Software license revenue is recognized upon 
execution of a contract or purchase order and shipment of the software, net 
of allowances for estimated future returns, provided that no significant 
obligations on the part of the Company remain outstanding and collection of 
the related receivable is deemed probable by management. An allowance for 
product returns is recorded by the Company at the time of sale and is 
measured periodically to adjust to changing circumstances, including changes 
in retail sales. Software maintenance fees, which are generally payable in 
advance and are non-refundable, are recognized ratably over the period of the 
maintenance contract, typically twelve months. Revenue from training and 
consulting services is recognized as services are provided. Deferred revenue 
consists of software license fees, consulting fees and training fees that 
have been prepaid or invoiced but that do not yet qualify for recognition as 
revenue under the Company's policy, as well as prepaid maintenance fees not 
yet recognized as revenue.

     Effective January 1, 1997, the Company changed its interim fiscal 
reporting periods from calendar quarters to quarters consisting of thirteen 
weeks.

     On July 8, 1998, the Company purchased certain assets (the "Labtam 
Assets"), including intellectual property, comprising certain T.120 
whiteboarding and data collaboration technology from Labtam Communications 
Pty. Ltd. ("Labtam"), an Australian corporation with a principal place of 
business in Braeside, Victoria, Australia. T.120 is the protocol that defines 
whiteboarding, application sharing and data collaboration for multipoint 
conferencing applications. The purchase price for the Labtam Assets consisted 
of (i) 900,000 shares of the Company's common stock, par value U.S. $0.01 per 
share; (ii) cash payment of a total of U.S. $628,060 in July 1998; and (iii) 
cash payment of A$201,606 due on January 15, 1999. The Company is 
incorporating the purchased technology into its MeetingPoint and ClassPoint 
conferencing solutions.

     On July 29, 1998, the Company reduced its total headcount by ten 
persons, of which seven were engaged in research and development, one in 
general and administration activities, and two in marketing. The Company 
estimates that the reorganization will provide cost savings of approximately 
$1,000,000 annually.

     On September 30, 1998, the Company terminated the employment of Bruce W. 
Lichorowic, its Vice President of Sales. On October 15, 1998, the Company 
terminated the employment of Brian L. Lichorowic, its Vice President of 
Marketing. The Company has consolidated the positions into one office, Vice 
President of Sales and Marketing, and has engaged the services of an 
executive search firm to assist in identifying candidates for the position. 
The Company believes that the temporary vacancy created by its termination of 
these two officers will not have an adverse effect on the Company's 
operations or financial results.

                                   9

<PAGE>

RESULTS OF OPERATIONS

     The following table sets forth line items from the Company's statement 
of operations as percentages of total revenue for the three and nine months 
ended October 2, 1998 and October 3, 1997.

<TABLE>
<CAPTION>

                                                        Three Months Ended                     Nine Months Ended
                                               ------------------------------------   ------------------------------------
                                                   October 2,        October 3,          October 2,         October 3,
                                                      1998              1997                1998               1997
                                               ------------------ -----------------   -----------------  -----------------
<S>                                            <C>                <C>                  <C>               <C>
Revenue:
      Software license fees...................           91.0 %            88.2 %              89.2 %             87.8 %
      Services and other......................            9.0              11.8                10.8               12.2
                                               ------------------ -----------------   -----------------  -----------------
      Total revenue...........................          100.0             100.0               100.0              100.0
Cost of revenue...............................           19.3              12.0                19.4               16.8
                                               ------------------ -----------------   -----------------  -----------------
Gross profit..................................           80.7              88.0                80.6               83.2
Operating expenses:
      Sales and marketing.....................           88.9              63.0               100.6               72.8
      Research and development................           64.3              45.2                68.3               56.1
      General and administrative..............           30.5              18.1                33.0               25.6
      Restructuring...........................            0.0               0.0                 0.0                8.2
                                               ------------------ -----------------   -----------------  -----------------
      Total operating expenses................          183.7             126.3               201.9              162.7
                                               ------------------ -----------------   -----------------  -----------------
Loss  from operations.........................         (103.0)            (38.3)             (121.3)             (79.5)
Other income (expense), net...................            5.3               8.0                 7.7                9.2
                                               ------------------ -----------------   -----------------  -----------------
Net loss before provision for income
  taxes.......................................          (97.7)            (30.3)             (113.6)             (70.3)
Provision for income taxes....................            0.0               0.2                 0.1                0.1
                                               ------------------ -----------------   -----------------  -----------------
Net loss......................................          (97.7)%           (30.5)%            (113.7)%            (70.4)%
                                               ------------------ -----------------   -----------------  -----------------
                                               ------------------ -----------------   -----------------  -----------------
</TABLE>

     Revenue

     Total revenue decreased by 33% to $1,934,000 in the quarter ended 
October 2, 1998 from $2,872,000 in the quarter ended October 3, 1997. Total 
revenue decreased by 30% to $5,641,000 in the nine months ended October 2, 
1998 from $8,097,000 in the comparable period of the prior year. The decrease 
in revenue was attributable to the continuing transition among the Company's 
product offerings, as growth in revenue from the Company's recently 
introduced server-solutions products was insufficient to offset declines in 
revenue from the Company's legacy connectivity and CU-SeeMe software products.

     The Company's revenue from CU-SeeMe, its videoconferencing client 
software, declined by 50% to $627,000 in the quarter ended October 2, 1998 
from $1,240,000 in the quarter ended October 3, 1997, and declined by 44% to 
$2,031,000 in the nine months ended October 2, 1998 from $3,655,000 in the 
same period of the prior year. Increased competition from free 
videoconferencing client offerings, primarily Microsoft's NetMeeting, has 
sharply driven the decline, as the Company's OEM vendors, which are 
principally located in the Pacific Rim countries, migrated from bundling 
CU-SeeMe to bundling free clients. As the result of these competitive 
pressures, the percentage of total revenue represented by revenue from 
CU-SeeMe has decreased to 32% in the quarter ended October 2, 1998 from 43% 
in the quarter ended October 3, 1997.


                                  10

<PAGE>

     The Company's legacy connectivity product sales continued to decline as 
the Company focuses fewer resources on the older product line. Legacy 
connectivity revenue declined by 52% to $433,000 in the quarter ended October 
2, 1998 from $894,000 in the quarter ended October 3, 1997 and decreased 45% 
to $1,613,000 in the nine months ended October 2, 1998 from $2,961,000 in the 
nine months ended October 3, 1997. The percentage of total revenue 
represented by revenue from legacy connectivity products decreased to 22% in 
the quarter ended October 2, 1998 from 31% in the quarter ended October 3, 
1997. Maintenance and other revenue has also decreased in conjunction with 
the decline of the legacy connectivity products, as the majority of 
maintenance agreements were for legacy products.

     Server-solutions revenue increased by 119% to $857,000 in the quarter 
ended October 2, 1998 from $391,000 in the quarter ended October 3, 1997 and 
increased 155% to $2,078,000 from $814,000 in the nine months ended October 
2, 1998 and October 3, 1997, respectively. Server-solutions revenue 
represented 44% of total revenue in the quarter ended October 2, 1998, 
compared with 41% in the second fiscal quarter and 26% in the first fiscal 
quarter. The Company anticipates that this trend will continue and 
server-solutions revenue will eventually offset the steady decline of client 
and connectivity revenues. The increases in server-solution revenue were 
attributable primarily to the Company's most recently released server 
products, MeetingPoint and ClassPoint, which were released in November 1997 
and April 1998, respectively. The most recent release of MeetingPoint, 
version 3.5, began shipping on September 14, 1998 and accounted for 47% of 
total server-solutions revenue in the quarter ended October 2, 1998. The rate 
of server revenue growth currently is determined principally by product 
performance and by customer acceptance and adoption. The Company is 
experiencing relatively lengthy, two-step sales cycles for its MeetingPoint 
and ClassPoint server products. The first step typically extends from one to 
three months and results in sales of small quantities of the server products 
for pilot programs. The Company expects that the second step will extend 
considerably longer, from six months to over a year, as customers decide 
whether to move beyond the pilot programs to deployment of MeetingPoint on a 
company-wide basis or deployment of ClassPoint as an operational 
long-distance learning program.

     The Company believes that minimal additional investment in the legacy 
connectivity products in the foreseeable future will slow the decline in 
connectivity revenue in the short term, providing the Company with an 
additional period to build the sales base for its server products. There can 
be no assurance that the Company will be successful in generating server 
revenue in an amount sufficient to offset declines in revenue from its client 
and legacy connectivity products, or at all. The actual amount of revenue 
generated by the Company's server products may vary significantly depending 
on a number of factors, including the unproven market status and 
acceptability of the products, significant and increasing competition for 
those products and other factors described under "Item 1A. Risk Factors" in 
the Company's Form 10-KSB for the year ended December 31, 1997, a copy of 
which is filed as an exhibit hereto and incorporated by reference herein. 
Even if the Company meets its internally projected revenue targets, the 
Company expects to incur a net loss for the fiscal year ending December 31, 
1998 and further expects that net losses will continue into the fiscal year 
ending December 31, 1999.

     Cost of Revenue

     Cost of revenue consists principally of royalties and associated 
amortization of paid license fees relating to third-party software included 
in the Company's products, and costs of product media, manuals, packaging 
materials, product localization for international markets, duplication and 
shipping. Cost of revenue as a percentage of total revenue increased by 7% to 
19% for the quarter ended October 2, 1998 over the quarter ended October 3, 
1997, due to higher royalties paid on the server revenue streams.


                                    11

<PAGE>

     Sales and Marketing

     Sales and marketing expense consists primarily of costs associated with 
sales and marketing personnel, sales commissions, trade shows, advertising 
and promotional materials. Sales and marketing expense decreased by 5% to 
$1,719,000 in the quarter ended October 2, 1998 as compared to the respective 
period in the prior year, and decreased by 4% to $5,675,000 in the nine 
months ended October 2, 1998 as compared to the respective period in the 
prior year. The Company added six sales personnel in the quarter ended July 
3, 1998, and terminated the employment of its Vice President of Sales, whose 
employment began in April 1998, on September 30, 1998. See "--Overview." 
While these net headcount additions increased salary expense over the prior 
year, the Company's decision to forego all bonuses in fiscal 1998 resulted in 
an overall decrease in sales and marketing expense in the current fiscal 
year. The Company expects sales and marketing expense to increase in the 
fourth fiscal quarter as the result of increased trade show activity.

     Research and Development

     Research and development expense consists primarily of costs of 
personnel and equipment. Research and development expense decreased by 4% to 
$1,244,000 in the quarter ended October 2, 1998, and by 15% to $3,855,000 in 
the nine months ended October 2, 1998, compared with the comparable periods 
in the previous year. The decreases were attributable principally to 
reductions in headcount, consulting fees and bonuses in comparison with the 
same periods in the prior year.

     General and Administrative

     General and administrative expense consists of administrative, financial 
and general management activities, including legal, accounting and other 
professional fees. General and administrative expense increased by 14% to 
$590,000 for the quarter ended October 2, 1998, and decreased by 10% to 
$1,860,000 for the nine months ended October 2, 1998, versus the 
corresponding periods in the prior year. The quarter-over-quarter increase 
was primarily due to the additional salaries of the President and Corporate 
Controller, both of which positions were vacant for part of the third quarter 
of 1997, and the inclusion in general and administration of the Company's 
order administration activities, which was classified in sales and marketing 
expense in 1997. The year-over-year decrease was attributable to decreased 
facilities expense and lower legal, audit and investor relations expenses.

     Provision for Income Taxes

     The Company's provision for income taxes consists of federal alternative 
minimum taxes and state and foreign income taxes. The Company made no 
provision for federal or state income taxes for the three or nine months 
ended October 2, 1998 or October 3, 1997 as the result of the net losses 
during those periods and its expectation that it will incur a net loss for 
the fiscal year ending December 31, 1998. The Company expects that its 
effective combined federal and state tax rate for the foreseeable future will 
be lower than the combined statutory rate, primarily as a result of the 
realization of net operating loss carryforwards. From time to time, the 
Company records a provision for foreign income taxes; to date, these 
provisions have been immaterial in amount.

LIQUIDITY AND CAPITAL RESOURCES

     The Company used cash of $6,457,000 in the nine months ended October 2, 
1998, as compared with $7,279,000 in the nine months ended October 3, 1997.

     Cash used in the nine months ended October 2, 1998 consisted principally 
of the net loss of $6,413,000, the payment of $770,000 as part of the 
purchase price for the Labtam Assets, and $191,000 in severance 


                                12

<PAGE>

payments, offset in part by receivables collections of $531,000 and the 
benefit of prepaid expenses in the amount of $284,000. Cash used in the nine 
months ended October 3, 1997 consisted primarily of the net loss of 
$5,704,000, prepayment to the Cornell Foundation of $1,000,000 for software 
royalties, and deferred revenue in the amount of $541,000. The Company's 
investing activities, predominantly investment in computer equipment and 
third-party software licenses, used cash of $543,000 and $979,000 in the nine 
months ended October 2, 1998 and October 3, 1997, respectively.

     On December 20, 1996, the Company entered into a commercial loan 
agreement with Fleet Bank-NH (the "Bank") providing for a $3,000,000 
revolving line of credit and a separate term loan in the initial principal 
amount of $53,000. The revolving line of credit expired on June 30, 1998, and 
was extended through August 30, 1998. On October 27, 1998, the line of credit 
was renewed and reduced to $1,000,000. Borrowings under the line of credit 
and the term loan are secured by substantially all of the Company's assets, 
including a $515,000 certificate of deposit and all of the Company's computer 
software products (including all source code, object code and intellectual 
property rights relating thereto). Amounts outstanding under the line of 
credit and the term loan bear interest at the Bank's prime rate plus 0.5% 
(8.5% at November 9, 1998).

     The commercial loan agreement requires that the Company provide the Bank 
with certain periodic financial reports and comply with certain financial and 
other ratios, including maintenance of a minimum net worth, a maximum ratio 
of total liabilities to tangible net worth, a minimum ratio of current assets 
to current liabilities and cumulative profitability levels for fiscal 1997 
and 1998. At October 2, 1998 and October 3, 1997, no borrowings were 
outstanding under the revolving line of credit and $20,000 and $31,000 were 
outstanding under the term loan, respectively.

     At October 2, 1998, the Company had cash and cash equivalents of 
$8,247,000 and working capital of $8,785,000. The Company believes that its 
current cash and cash equivalents, funds generated from operations (if any) 
and borrowings under its bank line of credit, will be sufficient to fund the 
Company's operations and capital expenditures through the remainder of 1998. 
Thereafter, the Company's liquidity will be materially dependent upon its 
internally generated funds and its ability to obtain funds from additional 
equity or debt financings from external sources. There can be no assurance 
that the Company will be able to secure these funds or the partnerships 
necessary to finance its operations.

     Year 2000 Compliance

     The Company has completed its Year 2000 compliance testing with respect 
to its client/server videoconferencing products (CU-SeeMe, MeetingPoint and 
ClassPoint) and believes, based on its testing, that each of those products 
is Year 2000 compliant. Each of those products is subject, however, to the 
compliancy of the third party vendors whose technology the Company has 
integrated. Similarly, the Company has completed its compliance testing with 
respect to its terminal emulation connectivity products (WebTerm, WebTermX, 
and eXodus), and believes, based on its testing, that each of those products 
is Year 2000 compliant. Their Year 2000 compliancy is dependent, however, 
upon the compliancy of the host systems to which they connect.

     As a result of the completion of the compliance testing, the Company 
does not expect to incur any material additional cost in connection with Year 
2000 compliance testing, and does not believe it is at material risk of 
noncompliance with respect to the Company's products. The Company does not 
extend any warranty for its products with respect to Year 2000 compliance. 
There can be no assurance, however, that certain of utility companies, 
including telephone companies, and other suppliers to the Company's business 
will be Year 2000 compliant. Any significant failure of any of those 
utilities or other vendors to comply may have an adverse affect on the 
Company's business.

                              13

<PAGE>

INFLATION

     Although certain of the Company's expenses increase with general 
inflation in the economy, inflation has not had a material impact on the 
Company's financial condition or results of operations to date.

RECENT ACCOUNTING PRONOUNCEMENTS

     Effective January 1, 1998, the Company adopted the provisions of 
Statement of Financial Accounting Standards No. 130, Reporting Comprehensive 
Income and AICPA Statement of Position No. 97-2, Software Revenue 
Recognition.  The adoption of these pronouncements has not had a material 
effect on the Company's financial position or results of operations.

     In June 1997, the Financial Accounting Standards Board released 
Statement of Financial Accounting Standards No. 131, Disclosures about 
Segments of an Enterprise and Related Information ("SFAS No. 131"), which is 
effective for fiscal 1998. SFAS No. 131 establishes standards for the way 
that public business enterprises report information about operating segments 
in annual financial statements and requires that those enterprises report 
selected information about operating segments in interim financial reports 
issued to stockholders. The adoption of SFAS No. 131 has not had a material 
effect on the Company's financial position, results of operations or cash 
flows.


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<PAGE>

                      PART II. OTHER INFORMATION

Item 1. Legal Proceedings

     The Company is a defendant in six lawsuits pending in New York federal 
and state courts (the "RSI Suits") in which the plaintiffs claim to suffer 
from carpal tunnel syndrome, or "repetitive stress injuries," as a result of 
having used computer keyboards (the "Keyboards") that are alleged to have 
been defectively designed. The Keyboards were supplied, and possibly designed 
and manufactured, by Ontel Corporation. The assets of Ontel Corporation were 
purchased in 1982 by Visual Technology, Inc. ("Visual"), a predecessor of 
Visual T.I., Inc. ("VTI"), which in turn is a predecessor of the Company. The 
RSI Suits, which seek money damages, were brought from February 1992 to June 
1996 by employees of New York Telephone, which purchased the Keyboards from 
Lockheed Electronics Corporation. One or more of Visual, Ontel Corporation, 
Lockheed Electronic Corporation and Key Tronics Corporation, a subcontractor 
for certain of the Keyboards, are named as co-defendants in certain of the 
RSI Suits. New York Telephone employees are also proceeding with 29 suits 
that name as defendants only Visual and/or Ontel Corporation. The Company 
could be named as a defendant in these cases. None of the RSI Suits has 
reached trial and additional information detrimental to the Company could be 
developed in the course of discovery.

     In May 1993, VTI's product liability coverage terminated. Certain of the 
RSI Suits appear to be based on claims that allegedly arose after May 1993, 
and therefore may be uninsured. The insurers for VTI, the Company and others 
(the "Insurers") are defending the RSI Suits under a reservation of rights. 
To date, the Company's proportionate share of the defense costs of the RSI 
Suits has not been material. There can be no assurance, however, that the 
Company will not incur material legal expenses defending the RSI Suits. The 
Company has a reserve of approximately $290,000 in connection with the RSI 
Suits, based upon the Company's belief that (i) certain of the RSI Suits are 
covered by product liability insurance, (ii) the Company is contractually 
indemnified by Lockheed Electronics Corporation and/or Key Tronics 
Corporation against all or a portion of the damages to which the Company may 
be subject and (iii) the Company has defenses to substantially all of the 
claims under the RSI Suits. Although the Company believes that its reserve 
for the RSI Suits is adequate, there can be no assurance that the Company's 
liabilities under the RSI Suits will not substantially exceed that reserve.

     New York Telephone and others may continue to use certain of the 
Keyboards and, accordingly, there can be no assurance that additional product 
liability claims will not be asserted against the Company in the future.

     From time to time, the Company has received and may receive in the 
future notice of claims of infringement of other parties' proprietary rights. 
Although the Company believes that its products and technology do not 
infringe the proprietary rights of others, there can be no assurance that 
additional third parties will not assert infringement and other claims 
against the Company or that any infringement claims will not be successful.

     From time to time, the Company may be exposed to litigation arising out 
of its products, services and operations. As of the date of filing this Form 
10-QSB, the Company is not engaged in any legal proceedings of a material 
nature, other than the RSI Suits.


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<PAGE>

Item 6. Exhibits and Reports on Form 8-K

         (a)  Exhibits

     Exhibit
      No.       Description
     ------     ----------

         10.1      Third Amendment to Commercial Loan Agreement and Loan
                   Documents dated October 27, 1998 with Fleet Bank - NH and
                   related Revolving Line of Credit Promissory Note

         11.1      Statement re computation of per share earnings 

         27.1      Financial Data Schedule for fiscal quarter ended 
                   October 3, 1998 

         99.1      Disclosure set forth under "Item 1A. Risk Factors" in the
                   Registrant's Annual Report on Form 10-KSB for the fiscal year
                   ended December 31, 1997 (incorporated by reference from pages
                   15 to 25 of such Annual Report)


     (b) Reports on Form 8-K

         On July 23, 1998, the Company filed with the Securities and Exchange
     Commission a Current Report on Form 8-K dated July 8, 1998 relating to the
     Company's acquisition of the Labtam Assets. See "Item 1. Management's
     Discussion and Analysis or Plan of Operation--Overview." No financial
     statements were required to be filed as a part of such Form 8-K.

         On November 4, 1998, the Company filed with the Securities and Exchange
     Commission a Current Report on Form 8-K dated September 30, 1998 relating
     to the Company's termination of the employment of two of its executive
     officers, Bruce W. Lichorowic and Brian L. Lichorowic, on September 30 and
     October 15, 1998, respectively. See "Management's Discussion and Analysis
     or Plan of Operation--Overview."

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<PAGE>

                             SIGNATURES

     In accordance with the requirements of the Securities Exchange Act of 
1934, the Registrant caused this report to be signed on its behalf by the 
undersigned, thereunto duly authorized, as of November 16, 1998.

                          WHITE PINE SOFTWARE, INC.

                          By: /s/ KILLKO A. CABALLERO
                             ----------------------------
                             Killko A. Caballero
                             President


                         By:  /s/ CHRISTINE J. COX
                             ----------------------------
                             Christine J. Cox
                             Vice President - Finance
                             (Principal Financial and Accounting Officer)





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