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Mailshell Grows Record Revenues, Profits And Margins In 2007 100% OEM Renewals And New Partnerships

Market for Email Reputation, Spam and Phishing Control Engines Will Expand in 2008

SAN FRANCISCO, CA - February 5, 2008 - Mailshell Inc., the leading provider of email reputation, anti-spam and anti-phishing AI engines for OEMs grew revenues by more than 30% in 2007, grew profits by more than 35% and generated more than 30% profit margins for the year, according to Tonny Yu, CEO of Mailshell. The company maintained its 100% renewal rate among OEM partners, grew its full-time work force by more than 50% and was awarded the first of many filed US patents. Mailshell's engines and SDKs are embedded by more than 30 OEMs including service providers, networking providers, enterprise software solutions, messaging platforms, SAAS platforms, desktop security suites, web browsers, hardware appliances, firewalls and small USB device manufacturers.

In addition to the continued global increase in the volume and scope of email-borne threats, Mailshell's growth was driven by the launch of LiveFeed, its highly scalable and reliable real-time reputation data service, and by its SDK Lite, which creates subscription revenues for OEMs by adding filtering to USB, networking and/or mobile devices.

"We finalized several major new OEM agreements in 2007, and saw new product launches from several others that will contribute significant recurring revenue and income in 2008 and beyond," said Tonny Yu, CEO of Mailshell. "We also successfully initiated sales of LiveFeed as a stand-alone service, as many security providers and networking companies look to increase throughput and decrease load on their existing filtering solutions."

Mailshell's solutions are built using the Mailshell AI Engine, a state-of-the-art artificial intelligence (AI) engine that is the cornerstone of the company's filtering technologies. The architecture of Mailshell's engine and SDK enable integration anywhere in the mail flow including service providers, networking providers, messaging platforms, SAAS platforms, workstation security suites and low-memory edge devices. OEMs configure the SDK to balance their goals of memory usage, throughput and accuracy.

2008 Focus: Grow the Core Business and Use AI to Fight Emerging Threats

"2008 will be a very exciting year as we release our most accurate, fastest, smallest, and most reliable AI engine after eight years of development," said Tonny Yu. "We will leap-frog the competition."

While the Company is primarily focused on the booming email reputation and network security markets, its next-generation applications of the Mailshell AI Engine will include optimizing ad targeting, search engine spam, IM spam, SMS spam, and network security. The Company has begun R&D projects with some existing OEM partners about extending its Mailshell AI Engine and reputation data beyond email filtering.

"Our core OEM business is all recurring revenue so we expect increased profitability this year," said Tonny Yu. "The market for our OEM solutions is still growing as companies add new subscription-based revenue."

The Mailshell AI Engine currently identifies spam, fraud and phishing and Mailshell is also working to also identify virus, malware, spyware and content type. The Company is also integrating the Mailshell AI Engine with more end-user applications to increase ease of use for OEMs.

About Mailshell Inc.: Mailshell is the leading provider of email reputation, anti-spam and anti-phishing engines for OEMs. Mailshell's software helps its OEM partners immediately generate new anti-spam revenue, up-sell existing products to new anti-spam customers and minimize anti-spam engineering and support costs. More than 6,000 companies and more than 15 million consumers rely on 'Powered by Mailshell' filters to protect them from email-borne threats worldwide. For more information: http://www.mailshell.com.

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Mailshell Inc., 695 Fifth Street, Suite #3, San Francisco, CA 94107, tel: 415.348.8728