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Partner program targets increased profitability and growth for solution providers. Includes new certification program for complete line of data protection solutions and proactive lead management

Paris, France – June 4th, 2007 – FalconStor Software, Inc. (NASDAQ: FALC), the leader in disk based data protection solutions, today announced major enhancements to its EMEA Solution Provider Program. The enhancements focus on increasing partner enablement: providing solution providers with a new certification program, joint marketing initiatives, and new sales rebates to increase profitability and growth with FalconStor.

FalconStor’s first certification program will certify partners on its market-leading VirtualTape Library, Continuous Data Protection and complete line of disk-based data protection solutions. Certification will enhance end user’s confidence in the partner’s ability to sell, design and install FalconStor data protection solutions. In turn, increased training will allow FalconStor partners to offer professional services based on FalconStor’s solutions, enhancing customer satisfaction. FalconStor has invested in this important program by expanding its training staff and integrating state-of-the-art training methodologies and delivery systems.

FalconStor will also offer more proactive lead management. In the last few months the company has invested in new lead generation campaigns with the objective of providing more qualified leads tailored to the partners.

“FalconStor is a channel-focused company. It’s imperative we make it easy for our solution provider partners to succeed with FalconStor, so we constantly listen and adapt our practices to develop a program that helps them become more successful,” said Danielle Gauthier, FalconStor Vice President, EMEA Marketing. “To generate growth for FalconStor and exceed the requirements of solution providers in the dynamic storage marketplace, we are delivering new tools, incentives, and program features to address a wide range of partner needs at all levels.”

“As a channel-based company, FalconStor has taken care to design a program to ensure its partners’ success,” said John Woolley, Sales Director at Cristie, a FalconStor partner in the UK. “Its training and education programs enable us to effectively position their software solutions to our customers and help us to drive profitable hardware sales. Overall, the company’s model and programs make it easy for us to lead with FalconStor.”

“When it comes to storage solutions, we rely on FalconStor not only for its superior technology, but also for its commitment to partnership,” said Steve Whitfield, Sales Director at Intercept IT. “The partner program is structured to ensure not only our profitability, but also our clients' success: the program helps us add value to our clients, has strategic sales and marketing initiatives and channel-dedicated sales and consulting resources.”

The new partner program provides FalconStor’s solution provider partners with the keys to growing their businesses and increasing sales. From its inception, FalconStor has believed in a channel-only sales strategy and has designed its programs on the basis of its deep channel expertise. In the USA, the program has been recognized two years in a row as a VARBusiness 5-Star Business Partner Program and the additions keep the company at the forefront in reseller-focused strategies for success.

“The worldwide enhancements to the FalconStor Solution Provider Partner Program show our commitment to partners and recognize the great work our resellers do in connecting customers with our data-protection solutions, including the industry leading VTL,” said Guillaume Imberti, President and General Manager, FalconStor EMEA. “With the growth we are seeing in Europe and other geographies, being driven by the demand for our disk-based data protection, our solution providers can confidently add to their bottom line profitability with further investments in FalconStor.”

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Notes to editors

New and upgraded partner benefits
The FalconStor Solution Provider Program now has a three-tiered structure, comprising Elite, Premier and Associate. The higher the tier, the greater the revenue and training commitments to FalconStor, and the greater sales and marketing benefits for the solution provider. The key benefits and changes made to the FalconStor Solution Provider Program are high on partners’ lists of requests: training, leads, marketing funds, and rebates.

For partners who invest in sales and certification and reach Elite level membership, FalconStor has expanded its Market Development Fund (MDF) program. The MDF program targets one-on-one development initiatives with dedicated marketing assistance for key Solution Providers. .

Additionally, FalconStor has implemented a quarterly-rebate incentive program that rewards Solution Providers that qualify through revenue and certification targets. The incentives are based on linear, quarter-over-quarter growth, rewarding base and stretch goals

More extensive partner communications
FalconStor has always placed strong emphasis on enhancing communications with its partner base. In the last six months it has implemented a “frequent touch” initiative that delivers information and updates to partners via a partner web portal, monthly webinars, newsletters, and a corporate-visit program. FalconStor is further expanding its partner communications through a Partner Advisory Council and quarterly Channel Forum — a “state-of-the-business” webinar for FalconStor partners.

The programs and benefits discussed in this release are examples and are offered at FalconStor’s sole discretion.

Press contacts:
Danielle Gauthier
FalconStor Software, Inc.
danielle.gauthier@falconstor.com
+33 1 39 23 95 50

Tim Donnelly Smith
Both Barrels Communications Ltd
timds@bbcomms.co.uk
+44 7801 755495

About FalconStor Software, Inc.
FalconStor Software, Inc. (NASDAQ: FALC) is the premier developer of proven data protection solutions that optimize data center efficiency and business continuity for all IT infrastructures. The company’s award-winning 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. Its products are available from major OEMs, system integrators, and resellers, and 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, N.Y., with offices throughout Europe and the Asia Pacific regions including Paris, Tokyo and Taiwan. For more information, visit www.falconstor.com.

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FalconStor is a registered trademark FalconStor Software, Inc.

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