Domino vs. Exchange - Business, technical, and political considerations

1. Domino vs. Exchange - Business, technical, and political considerations Ed Brill Senior Manager, Lotus Solutions Marketing July 24, 2002

2. Marketplace update • Understanding Exchange's Weaknesses • Understanding Domino's Strengths • Q&A Agenda

3. Messaging reaches the entire organization • 24x7 operation • Increasingly used for operations, not just communication • User Segmentation • Knowledge Workers = Collaboration • Productivity Workers = Rich messaging • Traveling Users = Mobile access • Focus on cost as well as value Trends in the Messaging Market

4. Total Cost of Ownership • Best of breed enterprise messaging capabilities • Scalability, reliability, manageability • Choice of platforms and deployment architectures • Wide array of client support, including mobility • Value beyond pure e-mail • Collaborative applications built-in or buildable • Integration with existing business applications • Vendor strength and expertise Typical Decision Criteria

5. IDC Market Share report, June 2001 IDC, June 2001: Worldwide Integrated Collaborative Environment Software -- Revenue

6. Microsoft's competitive positioning • Claim many of Domino's competitive differentiators as their own • Scalability, availability, security, enterprise integration and workflow, web application development, ad-hoc teams • Outlook is a better client than R5 • R5 migration just as expensive as move to E2K • Lower TCO • Enterprise Agreement covers all you need for mail and collaboration • Domino's dead, Notes is dead, Lotus is dead and Exchange is the market leader

7. Less than 20% of Exchange 5.5 customers upgraded in first 18 months (Ferris, Radicati) • Gartner says it's even less -- 5%! (April 2002) • This is why Microsoft is after Lotus customers! • Active Directory is an expensive deployment challenge • Server consolidation needed to drive down costs • with lots of cheaper "mail only" solutions in market • Exchange 2000 • Huge technical deficiencies in messaging alone • Not a collaboration platform • $400+ per user to upgrade!!!! (Ferris 2002) • Wondering about Exchange's future in a .NET world Exchange customer's grass isn't necessarily greener....

8. "Clarifying the Fuzzy Future of WSS" [Web Storage System] May 2001 • "If Microsoft plans to make Yukon the back end of the future, should we bother expending considerable time and effort building on the WSS today?" • "[T]he future of Exchange and the WSS appears to be toounstable for us to make long-range plans for systems and applications based on these technologies." • "[T]he current state of migrating apps to .NET doesn't bode well for our future. "

9. Reliability • Clustering requires shared disk, no "hot site" config. • Clustering model recommends <1500 users per server or active/passive configuration • No individual mailbox backup and recovery Key Exchange 2000 Technical Deficiencies Scalability • Shared data store is a single point of failure • Limited by Windows32 architecture -- MS internal deployment only 3000 users per server • No integrated PKI -- two additional servers required, few users • API open to "Outlook Transmitted Diseases" • No concept of an execution control list Security Mobility • 20-80% more bandwidth required • Doesn't do true replication • No offline browser support • No dedicated tools for apps • Distributed public folders almost never used • No deployment model • Write separate for web and Outlook Applications

10. So why does Domino beat Exchange? "From a quality-of-life perspective, puttingtechnology like Domino on the ships is the best thing we've done in the last 100 years" Sam Katz Information Technology Director Atlantic Fleet, US Navy

11. Unmatched Security No virus attacks End-to-end encryption Local data protection Unsurpassed Reliability Availability Scalability Consistent Architecture True Collaboration Developer friendly Open and "integrat-able" Evolving with the market Key Domino differentiators Enterprise Strength User Flexibility Eight server platforms Rich clients or browsers Full range of mobility and off-line support Completely customizable

12. Lotus Domino 5.05 vs. MS Exchange 2000 Radicati Group, December 2001 Comparing Total Cost of Ownership Per user per year Average costs Lotus Microsoft Acquisition Costs $145.93 $148.40 Maintenance Costs $29.43 $32.72 Installation and Configuration $17.94 $41.15 Administration $93.04* $25.54 Downtime $20.73 **

13. Lotus Domino 5.05 vs. MS Exchange 2000 Radicati Group, December 2001 Comparing Total Cost of Ownership * Putting aside the study's assertion that Notes admins work 80 hours per week... "Lotus Notes is particularly tailored to support messaging-based applications, therefore, environments running Notes typically deploy a greater number of messaging-based applications than any other messaging environment. This accounts for the higher time spent by Notes administrators on managing messaging-based applications." ** "The fairly high amount of downtime for Microsoft was due largely to unscheduled downtime. Lotus downtime, on the other hand, was largely for scheduled downtime."

14. Microsoft Exchange is More Expensive than Lotus Domino FERRIS INSIGHT BULLETIN January 25, 2002 "Our belief is that you could at least half the reported administration cost for a Lotus Domino deployment in orderto get a fairer comparison between the lifecycle cost of Exchange and Domino for e-mail. Overall, this change gives a per user saving of $4.80 per month with Domino vs. Exchange, making Domino 22% cheaper to run." Comparing Total Cost of Ownership

15. Usability • Feature differences go both ways • Only Lotus offers a full-featured Web client • Notes 6 designed to conform • Use iNotes Outlook if you have to • Or check out OpenNTF.ORG's work on "Lookout" • Integration • IBM is Microsoft's largest ISV! • R5 features MAPI support, Office Doc Library, Wordmail, more • Domino can run with IIS, Domino 6 even more flexible • Active Directory and MMC management in Domino 6 • Keeping Notes/Domino current • Manage your deployment effectively • Stay current on releases Overcoming common concerns

16. "The license for Outlook is included in the site license for Office, so it may seem at first blush to be cheaper. But the license cost is generally 5 percent of the total cost of ownership. Enterprises should keep looking for the systems and people costs that make up the other 95%" • "The Notes client uses the same messaging API (MAPI) compatibility with Office ... so most interactions with the Office suite are, in fact, available in the Notes client" • "Synchronization of Outlook with Exchange is significantly less efficient than replication of Notes with Domino. No improvement to this situation is expected from Microsoft until at least 2003 (.8 probability)" • "Lotus does...provide a better base for development of a browser client, and is expected to maintain that lead for at least the next two years" "Desktop clients: Lotus Notes vs. Microsoft Outlook" DF13-2894, May 2001

17. Over 150 companies took advantage of our Exchange/Groupwise buyback program in 2001 • Easier for smaller organizations, of course • Migration tool built into Domino R5 Admin • iNotes Access for MS-Outlook available to ease the transition • Coexistence tools available from MS • Third party partner tools also available • Specially enabled "Move2Lotus" business partners Migrating from Exchange to Domino

18. Understand Lotus' current and future strategy • Be proactive at communicating the benefits of your environment to your end users • No viruses, less downtime, better offline productivity • "The Truth is Out There" - Be vigilant against false claims and conjecture • Visit http://www.lotus.com/compare • Be friends with your Lotus and IBM sales teams • and don't feed the FUD! Call To Action

19. Questions? • Submit your questions now by clicking on the “Ask A Question” button in the bottom left corner of your presentation screen. Thank you! ed_brill@us.ibm.com