André Bakken Macrovision Senior Product Manager Logo Area for Speaker Five Best Practices for Streamlining Licensing Operations

2 2 IMAGINE…

3 3 AGENDA  Operational Challenges  5 Best Practices  Case Studies  Why Automate Your Operations Applications  Q & A

4 4 INEFFICIENT LICENSING OPERATIONS NEGATIVELY IMPACTS VALUE CHAIN “It takes too many steps to generate licenses for orders” “I handle too many support calls for incorrect keys and license changes” “Supporting new packaging, pricing, promos, demos require costly customizations” “I could sell more if our packaging & pricing was more flexible… or If I could do more demos.” “I cannot introduce new pricing, packaging, demos, promotions because our systems & operations are inflexible” How do I streamline operations to cost- effectively respond to business and end user needs? VP Operations Marketing Sales Customer Support Fulfillment Inside Sales IT  60% of software vendors made licensing changes in 2003*  60% of software vendors are considering changes in 2004*  33% of software vendors that made licensing changes in 2003 are considering changes in 2004 as well* * Source: IDC’s Future of Software Licensing Study, 2004 “I think I’m losing money on renewals & upgrades because I don’t know when licenses expire or what product version a customer is on”

5 5 VP Operations INEFFICIENT LICENSING OPERATIONS NEGATIVELY IMPACTS PROFITABILITY Sources: (1) McKinsey & Co (2) “Technical Support Cost Ratios”, Soft Letter & The Association of Support Professionals (3) Macrovision customer surveys Inside Sales 5-10% missed renewal & upgrade revenues (3) Customer Support $36 per licensing related support call (2) …lost keys …incorrect keys …license changes Fulfillment 1-2% of gross revenues spent …in product fulfillment & generating licenses (3) Marketing Sales 5-10 percentage points lower profits (1) …inflexible pricing & packaging IT % of gross revenues to customize inflexible systems (3) …to keep up with new pricing/packaging

6 6 INEFFICIENCIES RESULT FROM BROKEN LICENSE LIFECYCLE PROCESSES License Lifecycle 2. Lack of ERP/CRM integration …manually entering order information to create licenses-- -time consuming & error prone 3. Poor design of install & activation experience …multiple installations & keys …error-prone user inputs (e.g. what is a HOSTID? Where is it?) 5. Manual tracking of installed base …for upsells and renewals 4. Lack of self-service …for license and entitlement changes 1. Inflexible systems …for handling new packaging or pricing

7 7 AGENDA  Operational Challenges  5 Best Practices  Case Studies  Why Automate Your Operations Application  Q & A

8 8 1.Ensure Change-Readiness Assume license changes are inevitable Expect changes on a continuous basis Operational applications must be flexible for changes in Business requirements Promotions Marketing campaigns New products Licensing Processes

Automate Handoffs Eliminate manual handoffs between ERP & CRM applications Integrate you Operations Application into ERP & CRP applications Minimize impacts along value chain Sales Operations Order Entry Fulfillment Product Management Marketing Operations

10 3. Enable self-service  Create usable web interface for license support activities –Track & Manage Entitlements –Renewals –Returns –Rehosts –Merge  Help customers –Track what they bought –Stay in compliance

11 4. Make licensing invisible  Create an end-user experience that enables “hands-free” license activation –End users should not know about licenses –Customers just want to order, install and use –Turn on software without customers knowing they received a license

12 5. Track license & entitlement histories As licenses generate, accumulate & report on customer purchases What versions customers actually install? Which customers have Product A, version 6.5? Which platforms are most in use? What have they bought vs. what have they installed? Maximize revenues from renewals and upgrades

13 AGENDA  Operational Challenges  5 Best Practices  Case Studies  Why Automate Your Operations Application  Q & A

14 OPERATIONS MODULE ENABLES WEB BASED SELF-SERVICE Self-service for end users and channel partners to: View entitlements Activate licenses Manage license changes Returns Rehosts Manage entitlement changes Transfers Splits Merges

15 TRACK AND AUTOMATE RENEWALS AND UPGRADES Track expiring licenses: – by date – by customer, – by product & version Automate renewal and upgrade processes

16 macromedia MAKING LICENSING INVISIBLE Publisher Enterprise Customer Software Operations Application Activation request License

17 CASE STUDY Business Challenge Streamline electronic licensing operations while… …supporting channel-centric selling model… for Internet appliance and Network Management software Solution Operations Module automates license lifecycle processes:  Demo/Evals  Synchronizes orders from SAP  Web self-service activation, return/rehost of licenses  Automates upgrade e.g. more seats for same product  Synchronizes Vantive (CRM) installed base Benefits  Minimize costs: –license activation costs via self-service & SAP integration –support costs for return/rehosts via self service –IT costs to adapt systems and processes  Maximize revenues: – by pricing and packaging what customers want to buy –upgrade revenue (e.g more seats of same product)

18 HOW IT WORKS FLEXnet Publisher Operations Module Installed base records Orders Self-service

19 VP Operations Marketing Sales Customer Support Fulfillm ent Inside Sales IT SELECT CUSTOMERS WHO AUTOMATE OPERATIONS

20 AGENDA  Operational Challenges  5 Best Practices  Case Studies  Why Automate Your Operations Application?  Q & A

21 Cost savings Upsell & Renewal revenues LOWER IT COSTS & INCREASE PRODUCT REVENUES Financial Benefit Capabilities Bottom Line Impact Fulfillment costs Support costs Track upsells and renewals Inside Sales IT costs Current Costs Reduced Costs Revenues from new packages One stop solution – maximize revenues from & lower costs for changing packaging/licensing IT Sales, Marketing Automate 100% of license lifecycle (activate, return/rehost, update, upsell/renew) Fulfillment, Support Support Fulfillment

22 OPERATIONS APPLICATION: STREAMLINED & SYNCHRONIZED. VP Operations Marketing Sales Customer Support Fulfillment Inside Sales IT

23 IMAGINE…Complete!  Accomplished: –30 Products in 30 Days  Go home early: –Have fun!