NetQoS Continues Rapid Growth in 2006 With Record Sales of Its Network Performance Management Products and Services.

Wide Adoption of the NetQoS Performance Center Product Suite Drives 238 New Customer Acquisitions

AUSTIN, Texas -- Fueled by its ability to meet the growing network performance management needs of large global organizations, NetQoS([R]) Inc. had another banner year in 2006. A provider of network performance management software and services for Global 4000 enterprises, NetQoS recorded revenue growth of 44 percent and added 238 new customers, a 62 percent increase over 2005.

"The success of NetQoS stems from our ability to help large global organizations ensure efficient application service delivery across the WAN," said Joel Trammell, CEO of NetQoS. "Our record year in terms of revenues, new customer acquisitions, and employee growth validates the performance-first approach to network management that we have been advocating since our inception. The continued success and adoption of the NetQoS Performance Center product suite will help us remain the fastest-growing network performance management vendor in 2007."

The NetQoS performance-first approach to network management, rather than a strict fault management approach, helps organizations tackle the challenges of delivering networked applications efficiently and cost effectively in today's complex infrastructures. This approach, manifested in the NetQoS Performance Center, provides visibility into all the key metrics necessary to quantify network infrastructure performance, starting with end-to-end response time measurement, and drilling down into traffic flows and device performance as necessary.

Rapid customer adoption of the NetQoS Performance Center, which had its first full year of availability in 2006, contributed in part to NetQoS' record sales. The NetQoS Performance Center's Web-based console integrates and presents data from NetQoS product modules -- SuperAgent([R]) for end-to-end performance monitoring, ReporterAnalyzer([TM]) for Cisco IOS([R]) NetFlow and IPFIX traffic reporting and analysis, and NetVoyant([R]) for device performance management -- to help customers be more effective in network troubleshooting, service level management, and capacity planning.

NetQoS' average deal size has grown 35 percent as existing customers and new prospects realize the value of combining two or more NetQoS products in the NetQoS Performance Center to mitigate risks from changes, solve network and application performance problems faster, and make more informed infrastructure investments. About 40 percent of NetQoS customers have already deployed and are using the NetQoS Performance Center in their network environments, and that number is expected to grow as NetQoS prepares to launch a new version this month.

Additional NetQoS 2006 milestones and highlights include:

* Added 238 new customers in 2006 compared to 193 new customers in 2005. New customers included AIG Technologies Inc., a member company of American International Group Inc.; Coach Inc.; ConAgra Foods Inc.; OSF Healthcare System; Marathon Oil Corp.; PSS World Medical Inc.; Pulte Homes Inc.; QUALCOMM; T. Rowe Price Group Inc.; and others in industries such as government (federal, state, local), healthcare, education, transportation, financial services, manufacturing, media, energy, technology, and retail. The company now has more than 600 customers worldwide.

* Doubled its workforce, bringing its total number of global employees to more than 200.

* Secured a partnership with Network Instruments([R]) that will enable joint customers to move seamlessly between the enterprise view of network and application performance via NetQoS SuperAgent and retrospective network analysis via Network Instruments GigaStor[TM] for easier and faster problem resolution.

* Expanded international operations by establishing a direct sales presence in the United Kingdom under the leadership of Paul O'Reilly, director of sales for EMEA, who is responsible for direct and channel sales. The expanded operations will help serve a rapidly growing European customer and prospect base. NetQoS also opened a sales office in Singapore to support its growing roster of resellers in Asia.

* Opened a 5,000-square-foot development center in the Research Triangle Park area to advance the company's network and application performance technologies.

* Hired Robert Machnacki as vice president of services to lead the expansion of the company's growing professional services and consulting organization. In 2006, NetQoS' professional services program, which includes product- and vendor-neutral consulting services and training that help organizations get the most value from their network infrastructure, increased revenues 175 percent over 2005.

NetQoS was also the recipient of numerous industry awards in 2006, including:

* Software Magazine's Software 500: NetQoS moved up to 313th on the 24th annual list and was named the fastest-growing company in the IT infrastructure/networking category among companies in the $10 million to $100 million revenue range.

* Deloitte's 2006 Technology Fast 500: NetQoS was listed as the 72nd fastest-growing company in North America. This was the company's third consecutive appearance on the list.

* Inc. 500 List: NetQoS was named to the list of America's fastest-growing private companies for the second consecutive year.

* Ernst & Young Austin Entrepreneur of the Year Award: CEO Joel Trammell was tapped for this prestigious annual award.

* 21(st) Annual Codie Awards: NetQoS ReporterAnalyzer([TM]) was named the Best Systems Management Solution finalist for products that best assist IT professionals to manage and monitor networks.

About NetQoS Inc.

NetQoS software and services help large organizations - including 8 of the Fortune 12 - improve the delivery of applications over wide area networks by enabling them to monitor application service levels, troubleshoot problems quickly, and plan for change. Representative NetQoS customers include Chevron, Lockheed Martin, American Express, Hilton Hotels, Siemens, Boeing, Deutsche Telekom, NASA, and Barclays Global Investors. Headquartered in Austin, Texas, NetQoS has R&D centers in Austin and Raleigh, N.C., and regional sales offices in London and Singapore. For more information, visit www.netqos.com or call 877-835-9575.