Sharp Adopts FalconStor's VirtualTape Library as its Backup Solution

<p>VTL Appliance Simplifies and Accelerates Backup for Leading Electronics Company</p>
<p>Sydney, Australia – November 25, 2004 - FalconStor Software, Inc. (Nasdaq: FALC), a leading developer of network storage infrastructure software solutions, today announced that Sharp Corporation has implemented FalconStor's VirtualTape Library (VTL) solution to simplify and accelerate its backup operations.</p>
<p>FalconStor's unique VTL solution, powered by the company's award-winning IPStor® Enterprise Edition software, consolidates the management of backup resources while enhancing the reliability of backup operations and accelerating the speed of recovery. VTL leverages industry standard high speed disk to provision virtual tape drives and libraries to backup servers attached to an iSCSI/IP or Fibre Channel (FC) storage area network (SAN) to maximise performance and return on investment.</p>
<p>Sharp was already using large-scale tape libraries for its backup operations. However, the increasing amount of data coupled with a limited backup window created an urgent need for a high-performance backup system. Sharp considered the possibility of adding more tape libraries, but was looking for a cost-effective solution. Factoring in the rapidly decreasing cost of disk and the recommendation of Nippon Steel Solutions, a systems integrator, Sharp decided to test FalconStor's VTL Appliance in their storage environment.</p>
<p>"FalconStor's VTL product met our needs for high-performance backup solutions. The product reduced our cost for adding new machines, and made our backup operations more flexible," said Noriyuki Koyama, counsellor of Sharp's IT Strategic Planning department. "As our IT environment grows in the future, we expect the VTL solution to seamlessly take on the task of managing the backup of additional application servers."</p>
<p>The VTL Appliance did not require any changes to Sharp's existing storage environment, so the solution was rapidly put to the test. Compared with the former tape library system, the actual test results with the VTL Appliance indicated that backup speed doubled, and restoration speed of data tripled. Based on these conclusions, Sharp decided to adopt FalconStor's VTL product.</p>
<p>"Virtual Tape Libraries are particularly proficient at solving backup and recovery issues, and are rapidly gaining widespread recognition across companies of all sizes in Japan," said Noboru Aoki, sales manager and director of FalconStor Japan. "FalconStor is committed to developing cost-effective and high quality storage solutions, while working with leading solutions integrators, such as Nippon Steel Solutions, who share our unique business philosophy."</p>
<p>About Sharp Corporation</p>
<p>Headquartered in Osaka, Japan, Sharp Corporation is a worldwide leader in the development and manufacture of electronic products for a wide range of consumer, business, and industrial needs. Sharp aims to revolutionise lifestyles across the globe by offering never-before imagined possibilities for people and the environment. Based on this vision, Sharp will continue playing an integral role in society through innovative products and services. For more information, visit http://sharp-world.com/index.html.</p>
<p>About NS Solutions</p>
<p>NS Solutions Corporation (www.ns-sol.co.jp), a subsidiary of The Nippon Steel Corporation, provides mission-critical solutions in the Internet age, to solve today's unpredictable data and processing volumes. The company provides network platforms, consisting of network, security, server, storage technologies, and software platforms, as well as network platforms comprised mainly of databases. NS Solutions also delivers a set or combination of wide range technologies in a one-stop service. Furthermore, NS Solutions aims to provide solutions that support all phases of systems infrastructure, via global alliances with various vendors, with the development of business on a national and global scale.</p>
<p>About FalconStor</p>
<p>FalconStor Software, Inc. (Nasdaq: FALC) is a leading developer of network storage software designed to optimise the storage, protection and availability of enterprise data. FalconStor's flagship product, IPStor, enables corporate IT to deploy a hardware-agnostic, network-centric foundation to maximise operating efficiency and business continuity, and to meet the availability requirements of mission-critical applications. IPStor-powered network storage solutions are available and supported by major OEMs, as well as system integrators and resellers worldwide.</p>
<p>Founded in 2000, FalconStor is headquartered in Melville, NY, with offices throughout Europe and the Asia Pacific regions including Paris, Tokyo and Taiwan. FalconStor is an active member of the Technical Support Alliance Network (TSANet), Storage Networking Industry Association (SNIA) and Fibre Channel Industry Association (FCIA). For more information, visit www.falconstor.com or call 1-631-777-5188.</p>
<p>This press release includes forward-looking statements that involve risk and uncertainties that could cause actual results to differ materially from the forward-looking statements. These risks and uncertainties include: delays in product development; market acceptance of FalconStor's products and services; technological change in the storage and networking industries; competition in the storage networking software market; the potential failure of FalconStor's OEM partners to introduce or to market products incorporating FalconStor's products; intellectual property issues; and other risk factors discussed in FalconStor's reports on Forms 10-K, 10-Q and other reports filed with the Securities and Exchange Commission.</p>
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<p>FalconStor and IPStor are trademarks or registered trademarks of FalconStor Software, Inc. All other company and product names contained herein may be trademarks of the respective holders.</p>
<p>Media Contacts:</p>
<p>Rob Stirling
Markom Marketing
+61 2 9977 8922
robstirling@markom.com.au</p>
<p>Joel Norton
FalconStor Software
+61 2 8912 2153
joel.norton@falconstor.com</p>

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