Microsoft Completes Acquisition of Secure Remote Access Technology Leader Whale Communications

REDMOND, Wash., July 26, 2006 —Microsoft today announced that it has completed the acquisition of Whale Communications Ltd., a leading provider of Windows-based Secure Sockets Layer Virtual Private Network (SSL VPN) technology for secure remote access to corporate applications and data.

To get an idea of what this deal means for Microsoft and Whale customers and industry partners and the broader implications for Microsoft’s security and access product offering and roadmap, PressPass spoke with Bob Kelly, general manager of Infrastructure Marketing at Microsoft.

PressPass: Why did Microsoft acquire an SSL VPN technology company?

Bob Kelly: Our customers today are being challenged to address the business need for faster, easier and more broadly available remote access to corporate applications and data from a growing base of mobile workers and partners. At the same time, application-layer security threats continue to rise, and organizations are exposed to exploits and attacks from many different sources.

Balancing the tensions among security, application functionality and broader access requires a flexible solution that provides rich application security and granular policy-based access. SSL VPN and Web application protection are integral parts of Microsoft’s secure access vision, delivering support for both full Web application functionality and network resource access to users on managed and unmanaged devices. While we at Microsoft have developed many complementary technologies and have built a strong solution with our ISA Server, we wanted to provide our customers greater choice in addressing a wide range of remote access scenarios.

This acquisition is a key part of delivering on our promise to protect information and control access. With that, we are committed to providing a comprehensive secure access platform that helps customers extend and manage the reach of their information systems.

PressPass: Why did you acquire Whale Communications specifically?

Bob Kelly: Based on our vision and strategy for secure access, Whale’s technology and people were the perfect fit. Whale is a technology leader in the SSL VPN and Web application firewall markets and is widely considered to be best-of-breed in the industry. Whale’s competitive differentiation in the SSL VPN market has been to provide more value to customers in the areas of end point security, customizability and full-featured remote access. The company distinguished itself in the marketplace with its early focus on application-level security, enabling policy enforcement down to the application level. The work Whale has done to optimize a broad set of Microsoft and third-party enterprise applications adds real, measurable value to business information systems. In addition, the fact that their solutions are Windows-based enables us to deliver a high level of native integration with Microsoft technologies, such as Windows Active Directory, authentication services and Microsoft applications. This technology brings integrated application protection and comprehensive policy enforcement to all customers.

PressPass: What does this news mean for customers and partners?

Bob Kelly: The completion of this acquisition means more customers can benefit from Whale’s best-of-breed technology through the scale and breadth of the Microsoft sales and support channels. Already available through Whale’s existing channel partners, Microsoft field sales professionals are now able to sell and support Whale’s products, making it easier for customers to purchase and deploy. In addition, Microsoft’s worldwide community of 300,000 plus partners and solution providers will be able to sign up for Whale’s partner program so that they, too, can build and sell secure access solutions.

Customers and partners now have a one-stop shop for products that enable a wide range of remote access scenarios. With Microsoft Internet Security and Acceleration (ISA) Server 2006 and the Whale Intelligent Application Gateway (IAG), businesses can extend access to key business applications and data to branch offices, partners, teleworkers and other users with ease of management and use, and a strong return on investment.

Today, we are also providing customers the opportunity to deploy Whale’s technology at a great value, by offering a 25 percent discount on Whale products through December 31, 2006. This six-month promotion includes the Intelligent Application Gateway, which incorporates Microsoft’s ISA) Server, Whale’s Application Optimizers, and their additional access methods, such as Network Connector. The promotion is for both new and existing Whale customers.

This promotion is in line with our aim of helping a much broader range of customers address a wide variety of remote-access scenarios with a single solution, so that more businesses are able to provide employees, partners and customers security-enhanced, policy-based remote access to networks, applications and data from more locations and devices.

PressPass: How will Whale’s products be offered to customers now that the acquisition is complete?

Bob Kelly: Microsoft and the new Whale subsidiary are continuing to make available Whale’s products and services on the same terms that Whale did before the acquisition, and customers can be assured of Microsoft’s commitment to continue to support and invest in this technology. Customers will be able to acquire existing products directly through both Whale and Microsoft sales teams, as well as through Whale’s global channel of Value Added Resellers.

Until now, this technology has primarily been acquired and deployed by enterprise customers. We are looking to drive adoption across a wider range of businesses, making remote-access technology simpler to obtain, deploy, manage and use. We will be relying on existing Whale partners as well as members of the Microsoft Security Partner Competency to help us do just that.

I think the partner opportunity here is enormous. There are some 600 million mobile workers worldwide, who would enjoy increased productivity and business impact if given greater access to critical business applications from remote locations and unmanaged devices. Our partners will benefit from this customer demand.

From today, Microsoft partners will be able to sign up for training on Whale technologies, so they can deploy and provide services around our broader remote-access offering. We also encourage Whale partners to become part of the broader Microsoft Partner Program.

We will also work with our ISA Server OEMs to provide the richest possible set of solutions built around these offerings.

PressPass: How do Whale technologies complement Microsoft ISA Server? Which remote access scenario does each solution address for customers?

Bob Kelly: I think there are three things that any customer currently evaluating an SSL VPN or remote access deployment should consider.

First, the incorporation of Microsoft ISA Server in Whale’s IAG delivers a comprehensive solution for providing security-enhanced access for a variety of scenarios.

Second, ISA Server itself is ideally suited for situations requiring a branch office gateway for site-to-site connectivity and security, data center Internet access control and Web caching, full network connectivity for managed PCs (via IPsec VPN), and advanced security with an inbound / outbound firewall.

Third, customers would deploy IAG when they need browser-based clientless access, more granular policy and control with strong end point security verification, and broader access for unmanaged PCs or mobile devices on unknown or un-trusted networks.

Importantly, Whale’s Application Optimizers add the benefits of customized policy and content inspection for Microsoft applications and third-party CRM, ERP and collaboration platforms. If customers have custom business applications, they can use the Optimizer Toolkit to instrument IAG for specific security and policy needs.

PressPass: What will you do with the products in the future?

Bob Kelly: As I mentioned, Whale technology is a key part of our secure access strategy.

We will have several phases of product availability over the next 18 months. We will continue to offer the broad selection of Whale’s products, including the IAG, Application Optimizers and network connectors. We are also working with our OEM partners to release an updated Whale and Microsoft ISA Server 2006 appliance, which we plan to bring to market in early 2007. At the same time, we will be integrating Whale technologies into the next release of ISA Server itself (after ISA Server 2006), with the intent to release shortly after Windows Server codename “Longhorn.” This new release will fall under the new Microsoft Forefront brand of security and secure-access solutions.

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