Network Instruments Experiences Near 30% Overall Growth and Strong Revenues

Competitive Wins In 2004, many IT organizations continued to select Observer's comprehensive monitoring and troubleshooting solution over competing products. Network Instruments' Partners attribute 2004's success to the value Observer provides their end-users. Frederick Engineering, a long-time partner of Network Instruments, has experienced substantial success in network analysis sales of Observer. "Network Instruments' unique selling proposition has allowed us to win significant deals this year," said Dave Gray, president of Frederick Engineering. "Not only does Network Instruments offer the most complete line of network analysis products, their prices are unmatched. When network administrators examine Observer's broad array of features, its multiple topology support, distributed architecture and then learn the price -- there is no doubt Observer offers the strongest ROI in the business." Major customer wins include: Acuity Insurance, American Heart Association, Avid Technology, Inc., Bank of Hawaii, Barnes & Noble, Bass Pro Shops, British Telecom NA, BT Connect, Chicago Board of Trade, CVS Pharmacy, Elgin Air Force Base -- 46th Test Wing, Fallon Clinic, Foundry Networks, Fujitsu, Harvard Business School, Honeywell, IBM, Kohler Co., Lockheed Martin, NASA, Penn State University, Piper Jaffray, Real Networks, Reuters, Social Security Administration, US Navy's SPAWAR Division, U.S. Cellular, Verizon Hawaii, and Washington Mutual. New Products In 2004, Network Instruments released Observer 10 -- with numerous enhancements including new wireless Expert conditions, capabilities for VLAN Analysis, new options for reporting, ability to automate packet captures, a report scheduler and greater security controls. * VLAN Analysis Observer 10 introduced Real-Time Statistics for VLANs. View VLAN data independently or in aggregate with a new VLAN mode. Administrators can determine if VLANs are overloaded and verify VLAN setups. * Wireless Enhancements By adding over 50 wireless conditions in 2004, Observer monitors on more WLAN events than any other heterogeneous analyzer. New monitors keep track of WLAN security and performance, including signal strength and quality, directed data rates, error rates, and station overloads. * Reporting Options In 2004, a variety of new reporting features were added to Observer. For example, Observer now offers over 20 Ready-Made Reporting templates for quicker report creation. A new Report Scheduler can automatically create and send reports on network health to Observer and non-Observer users alike. * Security Additions Network administrators can password protect and limit captures to a set number of bytes, preventing access to confidential data. This feature can be set at the company, department or individual level. * Network Delay Observer's Expert Analysis now reports Network Delay as a separate metric. Network Delay provides an indication of the actual time spent on the wire from point A to point B, independent of client or server delay. Measuring network delay helps determine what portion of total delay is due specifically to the network and not resulting from operating systems or applications. "The network analysis industry is constantly evolving," said Douglas Smith, president of Network Instruments. "At first, protocol analyzers were simply a tool a network administrator turned on when there was a network problem; now network analyzers offer administrators the means to be more proactive about network management and capacity planning. Our task at Network Instruments is to stay ahead of the game by ensuring that Observer remains the only solution needed for complete visibility into every part of the network." The company also unveiled new innovations in remote monitoring. These include: * Advanced Expert Probe A step up from the Advanced Multi-Probe released in 2003, the Advanced Expert Probe performs Expert data processing and packet capture in real-time and post-capture at the remote location, transferring only screen updates to the Observer console. This speeds remote troubleshooting and reduces network traffic. * GigaTrunk Probe Appliance The GigaTrunk Probe monitors up to four full-duplex links simultaneously, guaranteeing the availability of business-critical applications and infrastructure located at the core of the network. * GigaStor Probe Appliance The GigaStor Probe is designed for massive data collection and storage to a multi-terabyte, high performance RAID array. This probe is ideal for enterprise network administrators at transaction and data-heavy corporations. * Full Duplex Probe Appliance The Full Duplex Probe Appliance offers complete visibility into Full Duplex Links while reducing switch load and ensuring data integrity. * Network Instruments Authentication Server (NIAS) For enterprise organizations, a new authentication server, the NIAS, was released to help manage security and authentication parameters for multiple console/probe connections. "In 2004, Network Instruments greatly expanded its probe offering," said Roman Oliynyk, CEO of Network Instruments. "Our enterprise clients asked for higher-end turn-key solutions, so we developed the GigaTrunk and GigaStor probe appliances to seamlessly integrate with Observer. In fact, all of our products are built within the NI-DNA framework, ensuring every Network Instruments Probe can report back to any Observer console for complete visibility across the entire network no matter where you are located." New Offices In 2004, Network Instruments opened new sales offices in San Jose, California, Dallas, Texas and Boston, Massachusetts to better serve local partners and end-users. With these three new locations, the company now has six US sales offices in addition to two European locations in London, England and Paris, France. "We understand the value of offering a local connection to our key partners and end-users," said Bruce Clark, vice president of sales for Network Instruments. "Our new sales offices offer concentrated support, strengthening our solid customer base. As Network Instruments continues to grow we look forward to expanding both nationally and internationally in 2005." Product Pricing Although Network Instruments added new enhancements to Observer and released multiple new remote monitoring options, pricing for Observer, Expert Observer and Observer Suite remained the same. Observer 10.1 with over 30 Real-Time Statistics is only $995.00. Expert Observer 10.1 includes Application Analysis, over 50 Real-Time Experts and the industry's largest 4GB Memory Buffer at $2895.00. The Observer Suite 10.1 package includes an SNMP Console and Web Reporting for $3995.00. A free product evaluation and additional information about Observer and Network Instruments is available at the company's Web site at www.networkinstruments.com.