FalconStor Continuous Data Protection Keeps Email Mobile for Inventec Appliances; Taiwan's Leading Cellular Phone Manufacturer Significantly Reduces Its Exchange Disaster Recovery Time from Hours to Minutes

Business Wire, May 16, 2006

TAIPEI, Taiwan -- FalconStor Software, Inc. (Nasdaq: FALC), the leading developer of proven data protection solutions, today announced that Inventec Appliances Corp., one of Taiwan's leading mobile phone manufacturers, has implemented FalconStor's Continuous Data Protection (CDP) solution for Microsoft Exchange, to protect the uptime of their messaging servers which are a vital part of the company's business operations.

"Although we realize it is impossible to stop a mail server from crashing, we hope, at the very least, to be able to swiftly recover the server and resume normal operations should this occur," said Chi-Liang Wu, director, Inventec Information Center. "Now that we have implemented FalconStor's CDP for our database servers, we will never have to worry again about email problems caused by crashed servers."

Periodic backups and security precautions had proved insufficient for recovery purposes after a severe server crash rendered Inventec's email system inoperable for two days. The downtime affected company-wide communications and worldwide customer support. Emboldened to implement a solution that would improve their system's availability and reliability, Inventec was challenged to find a cost-effective solution that would be as robust and reliable as an extensive network-based solution, while providing minimal recovery time in the event of a disaster. FalconStor's CDP solution for Exchange addressed their IT pain points.

Using high-speed data transfer over iSCSI, FalconStor CDP backs up copies of Inventec's email data onto the storage server in real time. FalconStor's host-based continuous replication software, DiskSafe(TM), runs on the Exchange server and frequently captures copies of the system and database volumes. FalconStor's tailored Snapshot Agent for Exchange, also running on the Exchange server, preserves transactional integrity and point-in-time consistency of Exchange data copies, making certain that data recovery is always fast and reliable.

"High data availability is an undeniable requirement for successful manufacturing organizations like Inventec to sustain business operations and run mission-critical applications continuously," said Alex Jiang, FalconStor vice president of sales and marketing for Asia Pacific. "The issues of complexity and data downtime for Inventec have been addressed as FalconStor's continuous data protection solution utilizes Inventec's existing Ethernet infrastructure and expertise, while easing their administration burden in a cost-effective iSCSI SAN."

More than satisfied with the protection provided by FalconStor solutions, Inventec is exploring a plan to implement further FalconStor CDP solutions for their Intranet data and SQL database environment.

About Inventec Appliances Corp.

Inventec Appliances Corp. oversees OKWAP, China's larges and most popular brand of mobile phones. In addition, the company manufactures and sells a variety of wireless communication devices. Operations are carried out in Taiwan, and across Asia and the United States.

As is the case with many organizations, Inventec relies on email for company-wide communications, including such topics as upstream and downstream linkages, product specifications, changes to designs, etc. Since Inventec supports customers across the globe, mail servers must support 24/7 continuous operations. Any unplanned downtime can be damaging to business. For the further information, please visit www.iac.com.tw.

About FalconStor

FalconStor Software, Inc. (Nasdaq: FALC) is the premier developer of adaptive data protection solutions that optimize data center efficiency and business continuity for all IT infrastructures. The company's innovative storage virtualization, continuous data protection (CDP), disaster recovery, and virtual tape library (VTL) solutions integrate seamlessly to ensure rapid data recovery and simplified storage management. FalconStor products - including award-winning IPStor(R) and VirtualTape Library software - are deployed worldwide by governments, educational institutions, and Fortune 1000 enterprises across industries including aerospace, energy production, financial services, healthcare, law, manufacturing, and telecommunications.

FalconStor is headquartered in Melville, New York, with offices throughout Europe and the Asia Pacific region. FalconStor is an active member of the Storage Networking Industry Association (SNIA). For more information, visit www.falconstor.com or call 1-866-NOW-FALC (866-669-3252).

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 network storage 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.