SOFTWARE VALUE MANAGEMENT

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SOFTWARE VALUE MANAGEMENT
Dan Stickel EVP General Manager Software
Technologies Group Macrovision
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AGENDA

• Software Pricing Licensing Study
• Software Value Management
• Case Studies
• How Do You Rate?

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MACROVISION BACKGROUND

• Digital product value management (software,
  movies, music)
• NASDAQ MVSN 170M estimated 2004 revenues
• 500 million desktops 70,000 customers 85B
  software protected
• 700 patents worldwide in licensing DRM
• IDC names Macrovision clearly the leader in
  licensing
• Worldwide support professional services

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SIIA BACKGROUND

• The Software Information Industry Association
  (SIIA)
• Principal trade association for software and
  digital content industry
• Global services in government relations,
  business development, corporate education and
  intellectual property protection
• More than 600 leading software and information
  companies

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METHODOLOGY SAMPLE
Email Survey in September 2004

• 396 Software Vendors
• Typical titles were CEO, CMO, VP Product
  Marketing, and VP Product Management
• SIIA, 3rd party databases

• 100 Enterprises
• Typical titles were CTO, VP Development, and IT
  Director
• InformationWeek, 3rd party databases

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Perpetual versus Subscription Today
Two-thirds of publishers focus on perpetuals
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Perpetual versus Subscription Tomorrow?
Publishers planning to increase subscriptions
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Perpetual versus Subscription Enterprise View
But enterprises prefer perpetuals
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Publisher License Metrics Today
Diverse mix reaches diverse buyers
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Publisher Licensing Metrics Tomorrow?
New metrics gaining ground
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Publisher License Metrics Enterprise View
But enterprises still prefer concurrent user
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License Compliance Today
Mix of techniques
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License Compliance Tomorrow?
Migration to automated software compliance
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License Compliance Enterprise View
Enterprises prefer centralized licensing
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Software Maintenance by Customer Type
Average 21 maintenance
Consumers pay less and get less.
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Software Maintenance by Publisher Size
Average 21 maintenance
Fairly uniform across publishers
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Study Key Findings

• Perpetual versus subscription
• Software publishers moving strongly to
  subscription
• Enterprise respondents prefer perpetual to
  subscription 21
• Licensing enforcement going digital
• New licensing models based on metrics gaining
  popularity
• Concurrent and per user pricing models still
  preferred
• Buyers still comfortable with no (paper)
  compliance, but prefer network licensing and
  product activation to audit teams or hardware
  dongles
• Maintenance fees
• Overall average 21
• Enterprises demand more, and pay more

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AGENDA

• Software Pricing Licensing Study
• Software Value Management
• Case Studies
• How Do You Rate?

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SOFTWARE VALUE MANAGEMENT
Software Value Management is a set of activities
during the software lifecycle that are focused
explicitly on maximizing the value of ones
software.
It begins once engineering is ready to release
the software that they have built. It ends when a
customer retires the application.
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SOFTWARE VALUE MANAGEMENT (SVM)
SVM activities are undertaken by BOTH software
publishers AND their customers.
Software Publisher
Define
Build
Market
Sell
Distribute
Service
Retire
Renew
Software Customer
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AGENDA

• Software Pricing Licensing Study
• Software Value Management
• Case Studies
• How Do You Rate?

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SOFTWARE VALUE MANAGEMENTVENDOR CASE STUDIES
Price License
Productize
Distribute
Evaluate
Purchase
Prepare
Maintain
Deploy
Re-Purchase
Market segmentation and better enforcement with
licensing technology helped us create a
substantial new revenue stream.
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SOFTWARE VALUE MANAGEMENTVENDOR CASE STUDIES
Price License
Productize
Distribute
Evaluate
Purchase
Prepare
Maintain
Deploy
Re-Purchase
Customers had to guess how many seats they
needed It really comes down to making sure
that customers have access to our software.
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SOFTWARE VALUE MANAGEMENTVENDOR CASE STUDIES
Price License
Productize
Distribute
Purchase
Prepare
Maintain
Deploy
Re-Purchase
Evaluate
Sometimes we do business with companies we dont
know well, in other parts of the world. Its
nice to be confident that after the evaluation
they really do have to pay us to continue using
the software.
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MOST ENTERPRISES ARE NOT TRACKING LICENSE
COMPLIANCE
What types of software license information do
you track?
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SOFTWARE VALUE MANAGEMENTENTERPRISE CASE STUDIES
Price License
Productize
Distribute
Evaluate
Purchase
Maintain
Re-Purchase
Prepare
Deploy
Before we had problems with conflicting
installs, which we had to resolve through a
lengthy trial error approach. Now we
proactively identify those problems upfront
before we deploy our applications.
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SOFTWARE VALUE MANAGEMENTVENDOR CASE STUDIES
Price License
Productize
Distribute
Evaluate
Purchase
Prepare
Deploy
Re-Purchase
Maintain
5.3 million customers needed to have the most
up-to-date software Today it is easy for us to
deliver software and data updates to all our
users thereby increasing customer satisfaction
and eliminating costly support calls.
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SOFTWARE VALUE MANAGEMENTENTERPRISE CASE STUDIES
Price License
Productize
Distribute
Evaluate
Purchase
Prepare
Deploy
Maintain
Re-Purchase
Software from 32 vendors supporting 18,000 people
globally We now understand exactly what our
license requirements are for the whole
corporation. With that information we can make
better, more informed and more strategic
decisions.
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SVM THE BOTTOM LINE FOR THE SOFTWARE VENDOR

• Increased Revenues through
• Better Pricing
• Differentiated Products
• Broader market penetration
• Deeper account penetration
• Greater customer serviceand satisfaction

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SVM THE BOTTOM LINE FOR THE ENTERPRISE

• Increased Productivity with
• Broader software distribution rights
• Greater uptime
• Optimized license purchasing
• Reduced Support Costs through
• Easier software deployment
• Easier license support
• Reduced crashes

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AGENDA

• Software Pricing Licensing Study
• Software Value Management
• Case Studies
• How Do You Rate?

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SVM HOW DOES YOUR COMPANY RATE?
?
?
?
?
?
?
?
?
?
Price License
Productize
Distribute
Evaluate
Purchase
Prepare
Maintain
Deploy
Re-Purchase

• Vendors
• Are you maximizing your revenue potential?
• Are you able to reach every potential user of
  your application?
• Are end-users instantly aware of new releases?
• Enterprise
• Are you maximizing your organizations
  productivity?
• Are you buying too much capacity? Too little?
• Can you quickly deploy new software with little
  effort or conflict concerns?

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SVM Stage DISTRIBUTE
Software Vendor Scorecard
Price License
Productize
Evaluate
Purchase
Prepare
Maintain
Deploy
Re-Purchase
Distribute

TOTAL
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SVM Stage PURCHASE
Software Vendor Scorecard
Price License
Productize
Distribute
Evaluate
Prepare
Maintain
Deploy
Re-Purchase
Purchase

TOTAL
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SVM Stage PURCHASE
Enterprise Scorecard
Price License
Productize
Distribute
Evaluate
Prepare
Maintain
Deploy
Re-Purchase
Purchase
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SVM Stage MAINTAIN
Enterprise Scorecard
Price License
Productize
Distribute
Evaluate
Purchase
Prepare
Deploy
Re-Purchase
Maintain
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SOFTWARE VALUE MANAGEMENT
SVM is a set of activities during the software
lifecycle that are focused explicitly on
maximizing the value of ones software.
Is your company extracting the maximum value from
its software?
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FOLLOW-UP

• SVM Scorecards?
• Send email to cbuk_at_macrovision.com
• Pricing Licensing report?
• Download at www.SoftSummit.com
• Sell SVM software?
• If your company contributes to the Software Value
  Management chain, we'd like to invite you to a
  special consortium on Jan 25. Please contact
  David Rowley at drowley_at_macrovision.com.