As 2009 begins to unfold and 2008 comes to a close, I thought I would share with you a summary of how things turned out for us at GigaSpaces this last year.

On the positive side ??? we have seen a great surge of interest from customers in industries that were not our usual profile in the past. More than 50 new customers to be exact. In particular ??? I want to mention web-commerce as a rapidly growing application profile we are seeing emerging as well as new OEM deals where were seeing GigaSpaces embedded with other product such as the integration with Mule-ESB. This may very well be related to the other great development of 2008 ??? The release of version 6.6 and our built-in support for seamless web application scaling. We just launched a new quick-start-guide that provides a complete walk through example on how to scale an existing web application here. This release was also marked by what we believe to be the biggest potential for GigaSpaces moving forward ??? Cloud Computing. Release 6.6 added a host of new features in this area ??? with more to come in our upcoming 7.0 release. .In particular I'd like to point to our continued support for web application with major enhancement to our Local-Cache support, Session replication and load-balancer integration that will fit better with web application behavior. 7.0 release will also add support for Sun Glassfish along side of our existing Jetty support. This will enable users to deploy a full JEE compliant application on our SLA driven environment and benefit from the self-healing, auto-scaling, and performance as well as from our built-in cloud-enablement along side other enhancement .This is quite exciting if I add to that our recent announcement with MySQL as well as our integration with Sun Grid Engine and Java Real Time. Were progressing full speed ahead with other areas as well such as .Net where we added support for Native Local cache as well as support for Event Driven development. On the cloud front as some have you noticed we've made quite a progress this year. We've been chosen as Best Cloud Application Provider 2008, top 100 cloud players. I'm also happy to announce that we already have more than 25 new customers using GigaSpaces on Amazon-EC2 coming from both Enterprise and Startups. And this is even before we declared a public-beta of our new cloud-framework. We also planning a series of new updates on that front ??? stay tuned.

Towards the end of 2008, and given the deteriorating macro economic situation, we have decided to accelerate what we believe will be the 2 pillars of our strategy moving forward: indirect sales through partners (regional/domain specific System Integrators) and the Cloud. This means we are significantly shifting our go-to-market towards activities that will extend our reach beyond the direct sales we have done until now. We are already heavily engaged in joint sales (including some closed deals) with more than 20 regional (across most of APAC, Western, Northern and Eastern Europe to Brazil and of course the US) as well as domain-specific (in the areas of Grid, Cloud, Fin Svcs and Telecom) SIs that form the backbone of our tier-1 SI and go-to-market partners. This change will allow us to achieve our last key objective for 2009 ??? ensure profitability even in the face of the unpredictable market condition.

This last objective became more important as the full impact of the economic crisis hit in mid-2008. It became evident that 2008 will not be the kind of growth year that the market had planned for a year earlier (GigaSpaces Ranked Third in Deloitte Israel Technology Fast 50). Further more it is clear that 2009 may even be a worse year in terms of the general macro-economic conditions. Given these economic conditions, we have reassessed our aggressive growth targets, and accordingly adjusted the size of our organization to ensure the company is profitable moving forward even under the worsening economic scenarios. Should market conditions prove us wrong over the next couple of quarters, we plan to go back to our original growth plans. However - this has lead to what I consider the hardest part for me in 2008. We have had to let go some good people and good friends who have been with us for some time. It is never easy to part ways with friends ??? but like everyone else (including some of our customers???) we had to take the steps necessary to ensure profitability given that the short term future market conditions are very unpredictable. I???m glad that at least this change hardly affected our R&D and support teams ??? and we are continuing to invest in both product enhancements and customer satisfaction.

So all in all ??? not a terrible year ??? but could have been better. I look forward with anticipation for 2009 to see how the recent changes we???ve made in strategy and go-to-market will play out. We all remain strong in our belief that directions we have taken recently, coupled with the very powerful and mature technology we???ve created and the Cloud Computing model, have the potential of addressing the market needs even more in these times.

I'd like to close by one of my favorite quotes this days from Tim Oreilly:

???if you look at history, you see that this has always and everywhere been true. (???) Great problems are also great opportunities for those who know how to solve them. And looking ahead, I can see great opportunities.???

Tim O???Reilly, Thoughts on the Financial Crisis, O???Reilly Radar

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