IBM Software Group

IBM Software Group Build with the Best A Strategy For Jointly Growing Revenue Glenn Newlove Lotus SWG May 2009

Key Discussion Points • Increase your margins with integrated solutions and faster implementations • IBM has a spectrum of partnering choices to match your business model • Influence • Resell • Software as a Service (SaaS) • We can build a plan to move quickly and attack the market together

So Which Partnering Option is Best for Me? … fundamental points to ponder… • Am I prepared to take a more proactive stance in recommending IBM SW with my solution? • Do I prefer getting a sales referral fee or bundling and reselling? • If I bundle/resell IBM SW, how can I get predictable pricing at lowest cost? • Do I want to be the single point of contact for my entire solution stack? • Could my customer call me for basic L1/L2 support? • Do I prefer to have a single WW contract with IBM? • Do I have SaaS in my go-to-market offerings portfolio?

SW Partnering Options with IBM

BENEFITS Rewards partners for influence Deal registration system protects partners’ registered opportunities Can be combined with VAP Delivers payments of: 10% of net customer invoice for Large Enterprise Deals 20% of net customer invoice for SMB Deals Software Value Incentive (SVI) • Rewards partners for successfully influencing IBM SWG deals to close • Rewards opportunity identification and selling • Partners receive SVI payments direct from IBM - no need to resell • No restrictions on use of payments • SVI membership requires IBM software certifications • Software is fulfilled through standard distribution processes

BENEFITS Customers familiar with PPA model Unrestricted use licenses: Customer can use licenses with other apps in their enterprise No L1/L2 support required Can add substantial margin beyond standard PPA resell Up to 40% available when combined with SVI incentives Value Advantage Plus • Reselling IBM middleware with your value add solution • Pricing determined by end customer’s Passport Advantage (PPA) discount level • A PPA reseller contract is required for each country in which you sell • You purchase the IBM SW via Value Added Distributor (VAD) • IBM provides support for its middleware • Customer receives unrestricted license for the SW • Rebates available for sale of your approved value added solutions

BENEFITS Simple WW contract eases paperwork Partner is single face to the customer More revenue through annual renewal streams Customer receives pre-integrated solution Application Specific License (ASL) • Allows ISVs to embed/bundle IBM middleware with their application • Can go to market with a total solution • End users may or may not know IBM middleware is included • All solution support, including L1/L2 support for the IBM SW, is provided by the ISV • The IBM license warranty is held by the ISV • The end user’s “right to use” allows only restrictive use of the code • Costs are predictable • Partner determines end-user pricing • Annual revenue commitment determines discount

BENEFITS Pricing models mirror typical SaaS (Annual contracts / no commitments) Significant discounts to ISV for providing Level 1 and Level 2 support to end user Use of IBM SW in conjunction with either IBM HW or IBM Managed Hosting qualifies ISV for SaaS Specialty Partner SaaS Specialty Partners receive go-to-market and demand generation support Software as a Service (SaaS) • ISVs embed IBM middleware into their remotely delivered service • ISV goes to market with a total solution • End users may or may not know IBM middleware is included • Solution support is provided by the ISV including L1/L2 support for the IBM SW,- No relationship between IBM and end user • IBM license warranty is held by the ISV • End user contracts directly with ISV via a subscription model • Costs are predictable • Partner determines end user pricing • Flat, annual billing model helps tie IBM SW costs to SaaS solution revenue stream

Recap

What the analysts are saying… “IBM’s efforts are a ‘best practice’ in the industry.” IDC, Worldwide Independent Software Vendor Programs, March 2006 “The best overall Business Partner Program.” Site IQ, IBM PartnerWorld Portal Best Practice Assessment, 2008 IBM was recently named best in class in 28 out of 31 categories as rated by Forrester Research. Forrester, Choosing an ISV Program, June 2008

Forrester names IBM Partner Programs Best in Class "ISV partner programs are a great resource for creating compelling offerings, taking them to market, and deploying them, sometimes in cooperation with other partners. IBM’s program is one of the most mature, with the global scope of a firm that has been a leading enterprise computing supplier for decades.” “Choosing an ISV Partner Program” June 2008

IBM ISV and Developer Relations(IDR) • Building an Ecosystem of Business Partners, IT professionals and academic leaders Renate Maier Manager of ISV and Developer Relations IBM Central and Eastern Europe, Middle East and Africa (CEEMEA) Renate_maier@at.ibm.com

ISV & Developer Relations (IDR) • What is IBM ISV & Developer Relations? • The Center of the Ecosystem: IBM Innovation Centers • IBM Academic Initiative • IBM developerWorks • PartnerWorld Industry Networks

IBM ISV & Developer Relations: Innovation powered by community We aspire to drive market leadership for IBM by building a community of partners, IT professionals and academic members, who passionately use, recommend and add value to our products and solutions. 14

ISV & Developer Relations • What is IBM ISV & Developer Relations? • The Center of the Ecosystem: IBM Innovation Centers • IBM Academic Initiative • IBM developerWorks • PartnerWorld Industry Networks

Over 40 centers worldwide! IBM Innovation Centers The heart of the ecosystem • Why they matter • Provide a place where Partners, IT professionals, and academics can find answers to everyday questions, build cutting edge skills, and explore the latest open-standards-based and open source technologies. • Unite a community impassioned about building faster, smarter solutions for business, and create cooperative selling relationships across the globe. • What they are • IBM Innovation Centers are the physical and virtual gathering places for business, academic and technology innovators. • Support locally and reach globally: Provide expertise in your local market while extending your reach worldwide.

HELSINKI Full Service IBM Innovation Centre (Hub) MOSCOW LONDON OSLO STOCKHOLM IBM Innovation Centre (Base) WARSAW eArchitects / Events DUBLIN COPENHAGEN HURSLEY PRAGUE BUDAPEST PARIS STUTTGART MILAN BRATISLAVA LA GAUDE MADRID BARCELONA TEL AVIV JOHANNESBURG IBM Innovation Centre (Satellite) KIEV Centre Project in progress BUCHAREST ZURICH LJUBLJANA ISTANBUL CASABLANCA

Launching local presence in emerging markets:Expanding IBM’s global footprint 41 centers worldwide! • Coming in 2009: • Bucharest, Romania • Ljubljana, Slovenia • Ho Chi Minh City, Vietnam • Just launched 2008: • Johannesburg, South Africa • Zurich, Switzerland • Istanbul, Turkey 18

IIC Activities - Workshops and Seminars • Grow your fundamental skills and in-depth knowledge • Worldwide delivery of technical and sales enablement education • Personalized learning • Web-based courseware training • Rich interactive simulations • Remote and hands-on classrooms • Host developerWorks workshops 19

ISV & Developer Relations • What is IBM ISV & Developer Relations? • The Center of the Ecosystem: IBM Innovation Centers • IBM Academic Initiative • IBM developerWorks • PartnerWorld Industry Networks • IBM Venture Capital Group

IBM Academic Initiative Building a pipeline of skilled students for the IT jobs of tomorrow • What it is • No charge access to IBM software and hardware systems to help academic leaders create a powerful and dynamic classroom experience. • Skills, certifications, contests and more to help students get real world experience and accreditation in IBM’s leading edge technologies. ibm.com/university/academicinitiative

developerWorks: IBM’s community of developers, IT Professionals, & students What we offer • IBM developerWorks is the destination on the web for developers and IT professionals to stay on the cutting edge and develop their skills on open standards technologies and IBM products. • Delivers the deep technical code, content, and community you need and depend on to get answers to your tough technical questions. • Delivers unparalleled content in over 4 languages, including articles, tutorials, demos, events and more. Key Statistics: Over 1M skill activities per year 34 industry awards Serves 200 countries 4 local language sites ibm.com/developerWorks/aboutdW

developerWorks has a wide breadth of technical content and community offerings for many IT roles Student Architect Analyst Developer & DBA Project Manager Application support Consultant Tester

Need to evaluate an IBM product or technology? We’ve got you covered with trial code & more • Standard trial code downloads • Online/hosted sandboxes • Beta code • Updates & fixes • NEW! IBM products are available on the Amazon Web Services Cloud. • Plus additional services to help you evaluate – demos, tutorials, forums, etc. Example: Try WebSphere Portal Express to see if it’s the best product to create a rich internet application

Bringing developerWorks to you • Follow us on Twitterwww.twitter.com/developerworks • developerWorks gizmos iGoogle, Yahoo, Netvibes • Learn more at ibm.com/developerworks/dwgizmos • Download the Google desktop gadget • developerWorks iPhone app ibm.com/developerWorks/iphone • Mobile developerWorkswireless.ibm.com/developerWorks • developerWorks on Facebook www.facebook.com/apps/application.php?id=5663866319

IBM PartnerWorld Industry Networks It’s what we do together that sets us apart • What it is • Education, assistance, and expertise to help Business Partners build and test solutions. • Resources to help Business Partners collaborate across the industry. • A Virtual Marketing Department: personalized help to Business Partners create and implement campaigns—and close deals today. ibm.com/partnerworld/industrynetworks

IBM PartnerWorld Industry Networks It’s what we do together that sets us apart • Why it matters Business Partners can: • Get to market fastwith technical resources and programs. • Uncover more opportunities and close deals fasterwith marketing and selling resources. • Expand their reach, engage new opportunities, and increase sales revenue through collaboration. • Leverage IBM leadership in new and emerging markets—like SaaS, Business Continuity, and more. ibm.com/partnerworld/industrynetworks

Thank you! 30

Discussion

BACKUP SLIDES

Bridging to Success – Essentials to Partnering Successful Partnerships Partnerships that Fail • Benefit/cost ratio is significant • Hard commitments on both sides • Sales and technology alignment • Close synchronization of product plans/strategy • Small business benefit for 1 or both parties • Limited commitment to success • Lack of clear incentives/penalties • Desire to compete, rather that partner • Pure technology partnership • Pure sales/GTM partnership

Empowering People to share their passion and expertise, foster collaboration and innovation, and improve business efficiency, decision-making and responsiveness Lotus Domino WebSphere Portal Server Lotus Quickr Lotus Sametime Lotus Connection • Business Process Flexibility • To develop and rapidly deploy innovative business models with flexible, optimized processes • WebSphere Business Modeler • WebSphere Business Monitor • WebSphere Process Server • WebSphere Integration Developer Industry’s Broadest Middleware Portfolio… delivering proven value to solve real business problems Information on Demand to optimize enterprise performance by unlocking the business value of information IBM DB2 IBM FileNet IBM Information Server IBM Identity and Relationship Resolution Service Oriented Architecture Service Management to enable innovation by reducing operational labor, and improving asset productivity and quality of service Tivoli Unified Process Tivoli IT CAM Tivoli Access Manager Tivoli Identity Manager Tivoli Compliance Insight Manager Software Lifecycle Management to better govern the business process of software and systems delivery enabling innovation at lower cost Rational Application Developer Rational Portfolio Manager Rational Asset Manager

Software Value Incentive (SVI) Business Partner Highlights: • Incremental incentives for: • Identifying new opportunities, and… • Active sales engagement • Focusing on the SMB market • Selling Solutions through VAP • Opportunity registration system: • Protects partners’ registered opportunities • Protects partner margins • Maximizes partner benefits received. • Single framework: • Covers all SWG brands • Applicable to multiple Business Partner types • (VARs, ISVs, Consultants & Integrators) Rewards Value Protects Contribution Reduces Complexity

Potential Revenue for SW Transaction – SVI Only ID and Sell activities must accompany each other “LE” = Large Enterprise

Potential Revenue for SW Transaction – VAP + SVI LE = Large Enterprise

SVI Call To Action • Visit: www.ibm.com/partnerworld/softwarevalueincentive • Review requirements for Certifications and Online Certification Opportunities • Make sure certifications are up to date and captured within IBM PartnerWorld databases. Questions? Contact IBM PartnerWorld Contact Center: 1-800-426-9990 • Join SVI Program • Upon notification of approval, begin submitting deals for SVI credit via Global Partner Portal

So Which Partnering Option is Best for Me? … fundamental points to ponder… • Am I prepared to take a more proactive stance in recommending IBM SW with my solution? • Do I prefer getting a sales referral fee or bundling and reselling? • If I bundle/resell IBM SW, how can I get predictable pricing at lowest cost? • Do I want to be the single point of contact for my entire solution stack? • Could my customer call me for basic L1/L2 support? • Do I prefer to have a single WW contract with IBM? • Do I want a ‘deep embed’ of the middleware in my solution? • Do I see value in working exclusively with IBM offerings? • Do I have SaaS in my go-to-market offerings portfolio?

IBM Software Group