DataSynapse Reports Continued Expansion, as Global Demand for Virtualization Technology Grows

Virtualization Industry Leader Builds on Success with Increase in Revenue, New Client Wins, Significant Additions in Headcount and Partners

NEW YORK - JAN. 31, 2007 - DataSynapse, Inc., the global provider of application virtualization software, today announced another solid year of growth in 2006 with revenues and client wins up 60 percent from 2005, as global demand for virtualization technology continues to increase.

According to Gartner Inc.'s 2006 Top 10 Strategic Technologies list, virtualization was a technology most likely to gain widespread adoption this past year. DataSynapse's market leadership confirmed this industry forecast for growth in emerging virtualization technologies. Expanding its global footprint, DataSynapse's customer base now spans 13 countries, where leading companies adopted DataSynapse solutions for their application virtualization strategies.

"Performance at the application layer is crucial to IT operations and leading enterprises have found that DataSynapse's products - GridServer® and FabricServer™ - address the principal challenges at this layer," said Anne MacFarland, director of data strategies and information solutions at The Clipper Group. "Its tremendous customer success in 2006 illustrated that whether an enterprise was challenged by scale, optimization, heterogeneity, enrichment or complexity, DataSynapse provided tools to address the problems."

In addition to growth within its install base, DataSynapse significantly expanded its research and development (R&D) efforts and product line in 2006. The company opened an R&D center in Boston to expand and diversify talent, significantly upgrading the company's testing and quality assurance capabilities. It also launched FabricServer, an application virtualization and provisioning platform, in May 2006. FabricServer centralizes the command and control of application deployment and execution by virtualizing application platforms, ISV and custom applications - ensuring that capacity is available and optimized based on business demand.

"By all accounts, 2006 was another year of strong growth for DataSynapse as the company firmly established its leadership position in the virtualization market," said Peter Y. Lee, CEO and co-founder of DataSynapse. "DataSynapse is exceptionally well positioned to help enterprises control and optimize capacity on demand - better aligning IT with business growth."

Other notable highlights in 2006 include:

Joint Client Success
Two DataSynapse clients were recognized for their successful virtualization implementations - Wachovia was honored by Computerworld, Network World, InformationWeek and InfoWorld, and BNP Paribas was recognized by The Banker and Financial Sector Technology.

Partner Momentum
With continued momentum in the virtualization space, DataSynapse experienced a stellar year partnering with systems vendors, ISVs and systems integrators. Some of DataSynapse's 2006 strategic partnerships include BEA, ClearCube Technology, ELCA, Group 1, Informatica, Jinfonet, SAS, Scalent, Sungard's Adaptiv and Tangosol.

Industry Leadership and Recognition
In 2006, DataSynapse continued to be recognized for its industry leadership, innovative technology and business achievement. Last year alone, DataSynapse won industry awards with Always On, Inc. 500, JBoss World, Financial-i and American Venture.

About DataSynapse

DataSynapse is a world leader in dynamic application service management software for the always on, always responsive data center. The DataSynapse platform is used by leading organizations to deliver, manage, and optimize scalable enterprise-class application services. DataSynapse provides a standardized, automated approach to configuring, activating and scaling enterprise applications in real-time environments for many of the world’s leading companies. For more information, please visit www.datasynapse.com.

Media and Analyst Contact

Alison Minaglia

aminaglia@datasynapse.com

(917)902-3404