Financing enables Ellacoya to capitalize on the fast-growing Deep Packet Inspection (DPI) equipment market

Ellacoya Networks™, Inc. a leading provider of carrier class broadband service optimization solutions based on deep packet inspection (DPI) technology, recently announced it has closed a funding round of $13 million. The funding was provided by Ellacoya’s syndicate of existing investors, including Atlas Venture, BCE (Bell Canada Enterprises) Capital, Canaan Partners, Lightspeed Venture Partners and Presidio Venture Partners. It will be used to support the company’s continued market share growth in the worldwide DPI service provider equipment market, accelerating product development and expanding Ellacoya’s presence in every major region.

“The market for deep packet inspection technology is quickly approaching an inflection point, evolving from a technology primarily deployed in North American cable and ISP networks to a critical network element in the Tier 1 worldwide telco and mobile wireless industries,” said Gerald Wesel, CEO and Chairman of Ellacoya Networks. “The new funding enables us to fully capitalize on the demand for our carrier-class, line-rate products in this fast-growing and exciting market.”

Various financial and industry analysts estimate the market for DPI service provider equipment to be up to $250M in 2006 and to grow to more than $1B in 2010. Ellacoya’s e30 platform and new industry leading e100 platform, the only custom-designed 20 Gbps wire-speed DPI network hardware element, enable service providers to effectively identify and manage network traffic dynamically by subscriber, service type, time-of-day, and more. Together with its rich suite of software applications, Ellacoya’s hardware platforms can: provide granular reports on network usage; manage traffic dynamically with precision; ensure VoIP quality; identity and prevent network threats; and provide the basis for quota management, differentiated service plans and quality-assured premium services (IPTV, VoIP, streaming video). The company has products installed at more than 150 service providers worldwide; including tier 1 telco and mobile wireless operators in each major region, and a recently announced deployment at SmarTone Vodafone in Hong Kong.

“With the best product for carrier-class and carrier-scale installations, as well as significant experience deploying system-wide in large telco and wireless networks, Ellacoya is well positioned to capture market share in this fast growing segment,” said Barry Fidelman, partner at Atlas Venture. “We are excited about Ellacoya’s position at this important stage of the market’s development.”

Ellacoya Networks is a leading provider of carrier-grade Broadband Service Optimization solutions that leverage deep packet inspection (DPI) technology to give broadband service providers the visibility and control necessary to optimize Internet services for their subscribers. The Ellacoya e30 and e100 hardware platforms and rich suite of software applications identify subscribers, classify and control applications on a per-subscriber basis, improve performance and customer satisfaction, and deliver revenue-generating IP services. Deployed in some of the world’s largest carrier IP networks, it is the only company that provides the scalability and functionality necessary to enable more compelling applications and competitive service offerings -- and to profit from them. Ellacoya Networks is privately held and based in Merrimack, New Hampshire with offices in London, Tokyo and Singapore.

For more information, please visit www.ellacoya.com