Akonix Enforcer Eliminates the Most Significant Threat to the Enterprise Today.

Business Editors/High-Tech Writers

SAN DIEGO--(BUSINESS WIRE)--April 22, 2003

Peer-to-Peer Applications Expose Organizations to Costly Lawsuits,

Dissemination of Confidential Information and Crippling Virus Attacks

Akonix Systems, Inc., the first company dedicated to protecting enterprise networks against the dangers of peer-to-peer file sharing, public instant messaging and other rogue protocols, today announced the availability of Akonix Enforcer(TM) to eliminate the security and corporate liability risks associated with unsanctioned peer-to-peer (P2P) file-sharing and public instant messaging (IM) applications. Akonix Enforcer is the only available enterprise solution on the market today that effectively blocks unsanctioned file transfers from entering or leaving an organization's network via P2P file-sharing and public IM applications.

File-sharing applications used to transfer files and materials from users' computers are exposing corporations, public and private institutions and universities to a broad range of serious consequences including costly legal action, virus infections, network security breaches, exposure of confidential information and significant loss of bandwidth. Akonix Enforcer provides organizations with a cost-effective solution for preventing unauthorized use of both P2P file-sharing applications that include Morpheus, KaZaA, LimeWire, and BearShare and public IM clients from AOL, Microsoft, Yahoo! and ICQ.

P2P applications introduce several types of legal liability. KaZaA, the most widely used P2P application claims more than 200 million downloads with more than 3 million in the last week alone. Beverly Hills-based Big Champagne, a market research and marketing consulting firm specializing in P2P technology, has reported that the downloading habit among 61 million Americans and millions more worldwide has "cemented" with only 9 percent believing they are doing anything wrong. In fact, downloading copyrighted music, video and software files put organizations at serious risk of legal action or hefty fines.

Over the last few months, Fortune 1000 companies have been receiving letters from the Recording Industry Association of America (RIAA) and the Motion Picture Association of America (MPAA) warning of the potential penalties for copyright infringements, including severe fines and seizure of equipment. Federal statute, titles 17 and 18 of the U.S. Code, provide criminal penalties for infringing on copyrighted material. Infringements can be punishable by up to five years in prison and $250,000 in fines. These same industry associations are also filing legal claims aimed at universities as well as individual students.

Some reports attribute more than half of all downloaded material to violating copyright infringements and a significant percentage contributing to sexual harassment in the workplace. A survey by Personnel Today found that about 11 percent of Internet-related human resources complaints were related to music downloads and over 50 percent related to pornography. The National Center for Missing and Exploited Children found that P2P networks are increasingly popular for disseminating child pornography.

With large video files representing almost half of P2P searches, the impact on bandwidth is an important consideration for any organization. Users may not be aware of the network bandwidth consumption associated transferring music, video and software files. In enterprise networks this activity not only affects the network performance of the responsible party, it also degrades the network performance for all users. North Dakota State University and Cornell University have both ascertained that KaZaA uses more than 50 percent of their residence hall bandwidth and at least 20 percent of their total bandwidth.

"An Arizona-based company targeted for storing illegal MP3s on company servers has already settled out of court for $1 million and now industry groups, like the RIAA and the NMPA, are lobbying Congress to levy even steeper penalties," said Peter Shaw, CEO Akonix. "Organizations who install Akonix Enforcer to block the use of P2P and public IM applications in their enterprise can immediately comply with existing laws and eliminate the potential for any litigious action."

The Akonix Enforcer identifies P2P and public IM activity using a sophisticated protocol signature matching technology. The Enforcer extends corporate firewalls by blocking P2P and selected public IM traffic trying to enter or leave the network. Without the Enforcer, port scanning and tunneling technologies built into these applications allow network P2P traffic to bypass existing network security including firewalls.

Use of P2P file sharing and public IM cause networks to become susceptible to accidental sharing of confidential material and users may inadvertently transmit viruses, Trojans or install spyware. Files transferred via these programs bypass existing enterprise security measures including firewalls and anti-virus servers; therefore, files that seemingly contain a popular music file can instead carry hazardous payloads. In order to bypass existing enterprise security, developers of P2P applications constantly change their software to evade detection. Akonix Enforcer's Dynamic Update Service automatically downloads from Akonix the latest changed protocol definitions, much like anti-virus solutions are updated with new virus definitions. This unique capability provides networks that have deployed the Akonix Enforcer with up-to-date protection in real-time.

"Akonix continues to deliver a comprehensive solution for solving the rapidly evolving security risks associated with public IM and P2P file sharing," said Pete Lindstrom, of Spire Security. "Using P2P file sharing to download any music, video or software without the appropriate license is not only an open invitation for legal action but a tremendous security risk that allows hackers and viruses full access to corporate networks."

The RIAA and MPAA are both actively policing the Internet for illegal transfer of copyrighted material. The RIAA claims that in the first six months of 2002 alone, CD sales fell 7.2%, with revenue falling 5.1%. This number could increase dramatically as more P2P file sharing applications are developed, downloaded and allowed to operate unrestricted. This increases pressure on the RIAA, whose 1500 members include BMG, EMI, Geffen, RCA, Sony, Virgin and Warner Bros., to attempt to clamp down on the use of P2P applications particularly from within high-bandwidth environments.

"...we will continue to monitor for infringing conduct and take any appropriate legal action necessary to protect our rights," the RIAA wrote in its letter to corporations whose employees were found to be using file-swapping software. Akonix Enforcer blocks the use of P2P and public IM applications allowing organizations to proactively prevent the security and liability risks associated with their use.

Availability

Product available mid-May 2003. For pricing information, contact your Akonix sales representative at [phone].

About Akonix

Akonix Systems, Inc. headquartered in San Diego, California is an award-winning provider of enterprise software that transforms public Instant Messaging (IM) into a safe, secure and manageable business-critical application. The company's offerings help corporations; public and private institutions and universities monitor, block and manage both public IM and Peer-to-Peer (P2P) file sharing. Backed by three premier venture capital firms, the company protects enterprise networks from the dangers of unmanaged public IM and P2P file sharing.

Akonix Rogue Aware is available for free download and monitors and reports on P2P and public IM use within an enterprise network. Akonix Enforcer protects organizations by preventing unauthorized use of P2P file sharing and public IM. Akonix L7 Enterprise enables corporations to secure, manage and report on IM usage, while satisfying Federal, industry and corporate compliance requirements. A free 30-day trial of Akonix L7 is available for download at www.akonix.com/freetrial. For more information, visit the company's Web site at www.akonix.com

Akonix is a registered trademark. All other trademarks, tradenames, service marks, service names and images mentioned and/or used herein belong to their respective owners.