VMware Completes Acquisition of B-hive Networks

PALO ALTO, Calif., July 2008 — VMware, Inc., (NYSE: VMW), the global leader in virtualization solutions from the desktop to the datacenter, today announced it has completed the acquisition of B-hive Networks, a privately-held application performance management software company with headquarters in San Mateo, California, and principal R&D facilities in Herzliya, Israel. VMware announced a definitive agreement to acquire B-hive on May 28, 2008. Financial terms of the deal were not disclosed.

With this acquisition, VMware will leverage the B-hive team and technology to enhance the VMware portfolio of application and infrastructure management products by offering proactive performance management and service level reporting for applications running within virtual machines. B-hive technology brings insight into the performance of applications and the ability to automate changes using VMware’s industry-leading datacenter virtualization and management suite, VMware Infrastructure, to reallocate resources as needed to ensure service level objectives. In addition, with this acquisition, B-hive’s R&D facility and team will form the core of VMware’s new development center in Israel.

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Forward-Looking Statements

Statements made in this press release which are not statements of historical fact are forward-looking statements and are subject to the safe harbor provisions created by the Private Securities Litigation Reform Act of 1995. Such forward-looking statements relate, but are not limited, to the timing and consummation of the B-hive acquisition, customer adoption of new virtualization software and establishment of our new development center in Israel. Actual results could differ materially from those projected in the forward-looking statements as a result of certain risk factors, including but not limited to: (i) anticipated benefits from the B-hive acquisition and the R&D facility in Israel; (ii) adverse changes in general economic or market conditions; (iii) delays or reductions in consumer or information technology spending; (iii) competitive factors, including but not limited to pricing pressures, industry consolidation, entry of new competitors into the virtualization market, and new product and marketing initiatives by our competitors; (iv) our customers’ ability to develop, and to transition to, new products, (v) the uncertainty of customer acceptance of emerging technology; (vi) rapid technological and market changes in virtualization software; (vii) changes to product development timelines; (vii) our ability to protect our proprietary technology; (viii) our ability to attract and retain highly qualified employees; and (ix) fluctuating currency exchange rates. These forward looking statements are based on current expectations and are subject to uncertainties and changes in condition, significance, value and effect as well as other risks detailed in documents filed with the Securities and Exchange Commission, including the report on Form 10-Q for the fiscal period ended March 31, 2008, which could cause actual results to vary from expectations. VMware disclaims any obligation to update any such forward-looking statements after the date of this release.