Ipswitch, Inc. Announces Record-Breaking Fiscal-Year 2004 with Renewed Focus on Small and Medium Businesses

Double-Digit Sales Growth for Fourth Quarter Caps Stellar Year

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Lexington, Mass. – January 24, 2005 – Ipswitch, Inc., the leading developer of network management, messaging and file transfer solutions for small and medium businesses, today reported a record-breaking year for both revenue and sales growth. The privately held company reported an 11 percent revenue increase for the year, continuing over a decade of uninterrupted profits and steady growth. Ipswitch’s product lines performed better than many others because of the high returns they deliver to the company’s core small and medium business customers.

Ipswitch Collaboration Suite (ICS), an integrated e-mail, instant messaging, and shared calendaring solution announced in October 2004, was quickly accepted by the SMB market and contributed heavily to Ipswitch’s strong Q4 finish. Also announced in fourth-quarter 2004 was the latest version of Ipswitch’s popular network monitoring solution, WhatsUp ® Professional, which secured 800 new customers during its first week of availability and was another substantial contributor to the company’s record quarter. ICS and WhatsUp Professional, like all of the company’s solutions, are purposely designed to meet the unique technology requirements of small and mid-sized businesses (SMB). The releases helped Ipswitch realize its best-ever sales month in December and strongest quarter ever in the fourth quarter of last year.

“Our record-breaking year validates the success of our strategic commitment to serving the SMB market and demonstrates the depth of our company’s vitality and staying power. Ipswitch is a reliable, stable company and is well-positioned for continued success in 2005. Customers embraced our new products at the end of 2004. Combined with a strong base of new OEM deals, customer wins, and product releases scheduled throughout the year, we have tremendous momentum built up for 2005,” said Roger Greene, president of Ipswitch.

Other milestones of the year include:

Technology and corporate awards, including the Mass High Tech New England Tech Citizenship Award, Windows IT Pro “Readers’ Choice Award” for WhatsUp Gold, and CMP Media’s Network Computing “Well-Connected Award” for WhatsUp Gold.

• Ipswitch WS_FTP ® Professional and Ipswitch WS_FTP Home released at the end of the second quarter with a major refresh to the user interfaces to make them more contemporary. The releases helped solidify and retain Ipswitch’s market leadership position in the FTP market space.

• In May 2004, Ipswitch unveiled the newest version of its market-leading file transfer solution, Ipswitch WS_FTP Server 5.0, which communicates critical business data in real time. That award-winning product line surpassed more than 40 million users in 2004.

• Ipswitch’s European business, located in Amsterdam, was a significant contributor to Ipswitch’s success with significant increases in sales among its distributor partners in all of the major European markets.

About Ipswitch, Inc.

Ipswitch develops and markets software that works for small and medium businesses worldwide. More than 100 million people use Ipswitch software every day to collaborate via Ipswitch Collaboration Suite, monitor their networks with Ipswitch WhatsUp ®, and transfer files over the Internet using the market leading Ipswitch WS_FTP ® Professional client and Ipswitch WS_FTP Server. Ipswitch values community involvement. Visit icare.Ipswitch.com to find out how to become involved. For product and sales information, write to or visit http://www.ipswitch.com.

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ICS, WS_FTP and WhatsUp are registered trademarks of Ipswitch, Inc. All other product names are property of their respective owners.