COUNTERPANE INTERNET SECURITY CLOSES STRONGEST QUARTER EVER WITH RECORD GROWTH THROUGH YEAR END

Company sees consecutive growth exceeding 30% each quarter through calendar year 2002

CUPERTINO, Calif., January 14, 2003 - Counterpane Internet Security, Inc., developer and acknowledged leader of Managed Security Monitoring (MSM) services, today announced record revenue and bookings through December and the fourth consecutive record quarter of growth over 30%.

"Our impressive growth through 2002 was a key contributor in securing our recent $20 million round of financing, " said John Bruce, Executive Vice President of Sales, Marketing and Business Development at Counterpane. "We'll invest these funds to drive growth of the business."

"The channel strategy we launched last year continues to be a winning one for us," continued John Bruce. "We're not only seeing impressive growth, but a decrease in our sales cycle from 6 months to less than 90 days."

"Counterpane is an excellent partner for NEC BNS. We see significant growth opportunities in managed security monitoring with Counterpane," said William J. Holman, Senior Vice President of Sales for NEC Business Network Solutions, Inc.

About Counterpane

Counterpane Internet Security, Inc., is the innovator and acknowledged leader in providing Managed Security Monitoring (MSM) services. MSM combines people and technology to safeguard businesses. Working from a network of technically sophisticated Secure Operations Centers (SOCs) and using progressive analysis tools, Counterpane has built the most advanced analysis, correlation, detection, and diagnosis technology, comprising a Sentry monitoring probe on the customer's network and the Socrates knowledge base inside the SOCs. Using this technology, Counterpane's expert Security Analysts are able to detect security incidents-both external intrusions and insider attacks-in real time, and tailor immediate, effective responses for its customers. The company is funded by Accel Partners, Amerindo Investment Advisors, Inc., Comcast Interactive Capital, LP, Bessemer Venture Partners, Dell Ventures, LP, Meritech Capital Partners, LP, Morgan Stanley Venture Partners and Symphony Technology Group. Headquarters are located at 1090 La Avenida, Mountain View, California, USA. Phone: 650-404-2400, Fax: 650-903-0461, Website: www.counterpane.com.

###

Counterpane is a trademark of Counterpane Internet Security, Inc. All other companies, brand names or products are trademarks or registered trademarks of their respective companies.