1. Open standards and open source A view on the market trends Open source Applications and Standards Workshop ETSI 16/12/04 Chandra De Keyser EU Business Development Director

2. Slide 2 Agenda Software AG, the XML Company Mixed revenue model Services trends Open standards versus Open Source Testing Open Source

3. Slide 3 Agenda Software AG, the XML Company Mixed revenue model Services trends Open Standards versus Open Source Testing Open Source

4. Slide 4 1979 First Mainframe 4GL 35 Years History of Technological Leadership 1971 First Mainframe Database developed by Peter Schnell 1969 Company founded 1985 Established First Platform Independent Language 1983 TAPS (Trade Analysis & Process System) Worlds Largest Clearing House System 1999 IPO – Frankfurt Stock Exchange MDAX Germanys Top 50 Stock 1998 Introduced First XML Server 1997 First company to port DCOM to Mainframe 2000 First Mobile Fleet Mgmt System 2002 SCP Award Outstanding service award received 6 years in a row 2002/2003 Company to Watch Intelligent Enterprise Magazine 1991 Introduced First Service Broker for Distributed Applications 2001 First Database to Utilize IBMs New 64 bit Virtual Storage Architecture for Mainframe 2003 Winner of 14 Readers Choice Awards in the XML / Web Services Journal Q4/2003 New strategic focus 2001/2002 Named Global Market Leader for XML Servers, IDC 2003 CIO 100 - Honoree CIO Magazine 2003

5. Slide 5 Computerworld – 2002 Innovative Technology Winner of six XML / Web Services Journal, Readers Choice Awards 2003 Awards Technology Tamino XML Server. EntireX XML / Web Services Journal, Readers Choice Awards 2003 Winner of eight Readers Choice Awards Intelligent Enterprise Magazine 2002/2003 Company to Watch CIO Magazine 2003 - CIO 100: HONOREE Company

6. Slide 6 Revenue & regional structure Region North Region South Region Central/Asia Approx. 39% Approx. 27% Approx. 34%

7. Slide 7 Agenda Software AG, the XML Company Mixed revenue model Services trends Open Standards versus Open Source Testing Open Source

8. Slide 8 More than 3500 Customers across all Industries worldwide Media & TelecommunicationsRetail & Manufacturing Government Transport & LogisticsFinance

9. Slide 9 Revenue 2003 (in M) 2003 Product Revenue License Maintenance 295.5 104.3 191.2 70% 25% 45% Services 124.3 30% Other 2.4 TOTAL 422.2

10. Slide 10 Example of Clients deals L&M: Delta: all core apps ADABAS/NATURAL FBI: core apps ADABAS/NATURAL Lufthansa, Deutsche Bahn, Crédit Lyonnais, Dexia Services: Spain Taxes: 15 yrs / 750 man years: NAT/ADA + DB2 + Java + XML + zOS + UNIX Spain Police: 12 yrs / 100+ man years NAT/ADA + Informix + Java + XML + zOS EU OPOCE: 12 yrs – 18 M XML + Java + Jboss + Oracle + Solaris BE PCF: 20 man years– 2 M XML + Java + python + PostgreSQL + Linux

11. Slide 11 Agenda Software AG, the XML Company Mixed revenue model Services trends Open Standards versus Open Source Testing Open Source

12. Slide 12 What Our Worldwide Customers Expect Protect mainframe investments Integrate business processes Cost savings Single Customer View Integration for real-time information

13. Slide 13 Transformation Routing Messaging Storage Indexing Querying Data Dictionary Business Terms Users & Roles Service Registry Aggregation Filters Distribution Other CustomersSuppliersPartnersEmployeesUsers XML / Web Service Interfaces Enterprise Communication Todays Customer Requirements Business view: Service Oriented Architecture (SOA) ERPCRM SCM B2B Communication Mainframe Legacy Integration Adapters Process Design Process Documentation Business Process Rules Process Flow Process Monitoring Application Services Information Services Process Services Custom Metadata Enterprise Services Business Data Business Functions EAI EII BPM

14. Slide 14 Service trend People do not want a fragmented view of (customers/partners/suppliers) from different heterogeneous systems (ERP, CRM, B2B, B2C, SCM, Call Center…) People want adaptable solutions to their business needs People want customization and services to integrate components, commercial and open source (the best mix) People cant accept (anymore) to give it all to a sole IT vendor: budgets are tight, cost cutting, strategic independence, negotiating leverage, plus… it does not work with just 1 supplier !

15. Slide 15 Agenda Software AG, the XML Company Mixed revenue model Services trends Open standards versus Open Source Testing Open Source

16. Slide 16 Open Standards versus Open Source Distinguishing Open Standards and Open Source People demand Open standards in order to: guarantee information perenity Interoperability avoid vendor lock in maintain low costs Open Standards: Formal bodies, international, industry consensus W3C, CEN, ETSI, ISO, IETF, IEEE, … Outcome : royalty – free consensus specifications, prototype demonstration

17. Slide 17 Open Standards versus Open Source Open Source: Informal initiatives. Sometimes solid industry backing. Main successes: Apache, Linux, Open Office, JBoss, MySQL, Eclipse… Business model (if any): Give source, sell service Joint development saves R&D costs Generate goodwill/marketing image by contributing

18. Slide 18 Benefits from Open Source Overall Benefit to Industry Open Source complements Open Standards Network effect from rapid dissemination of new technology Build consensus on best practices Commodity infrastructure allows companies to focus on their areas of real expertise and differentiation Benefits to Software AG (Services) Build flexible & more competitive solutions Customers demand Lower cost of products -> increase sales of services Benefits to Software AG (R&D) Benchmark our products vis à vis Open Source products Contribute -> get support from developers

19. Slide 19 Software AG involvement Active Contribution to Open Source Projects SAXON XSLT/XQuery Processor (Michael Kay) Jakarta-Slide (4 people) WEBDAV API Software AG – Novell: SuSE + Tamino + Novell sw Industry Standards Committees W3C XQuery (Walter Waterfeld, Thorsten Fiebig ) W3C XSLT (Michael Kay) W3C SOAP and WSDL (Dietmar Gaertner, Mike Champion) W3C Web Services Architecture (Mike Champion) JSR 170 Repository API (Juergen Pill) IETF WebDAV DASL (Martin Wallmer)

20. Slide 20 Agenda Software AG, the XML Company Mixed revenue model Services trends Open standards versus Open Source Testing Open Source

21. Slide 21 Testing Testing process, organization. Standards - compliant products Not just open source ! Also commercial products

22. Questions? Comments? Thank you ! chandra.de_keyser@softwareag.com +32 494 632300 chandra.de_keyser@softwareag.com