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Welcome to

SoftSummit 2010!

October 11 – 13, 2010

Hilton San Jose

San Jose, CA

Flexera Software

Overview and Vision

Mark Bishof

President and Chief Executive Officer

Flexera Software

Agenda

• Flexera Software Business Update

• The World is Changing

• Flexera Software’s Role

Flexera Software

Business Update

Flexera Software Summary

Industry Leadership

Strong Management

Broad Growth

Opportunities

Blue Chip Customers

Strong Financial Profile

Application Usage Management

Leading supplier of solutions enabling software producers to

optimize revenues and enterprises to maximize value

Seasoned, experienced management team

• Software Entitlement Management Solutions

• Installation & Packaging Solutions

• Enterprise License Optimization

• $140m in revenue

• $50m in EBIDTA

• Strong run-rate revenue profile

Forces Driving Application Usage ManagementApplications Have Turned Strategic

Producers of

Applications• Drive revenue &

protect assets

• Mature

monetization

• Position for

usage-based

future

Consumers of

Applications• Avoid surprises

• Step beyond

discounts

• Globalize usage

• Rationalization

of supplyTipping

Point

Application Usage Management “System”

Strategic

Solutions for

Application

Usage

Management

Producers of

Applications• Drive revenue

& protect

assets

• Mature

monetization

• Position for

usage-based

future

Consumers of

Applications• Avoid surprises

• Step beyond

discounts

• Globalize

usage

• Rationalization

of supply

Applications Have Turned Strategic

Software & Hardware Producers Enterprises & Government

Application Readiness• Application discovery and

identification

• Compatibility testing

• Planning

• Fixing & Packaging

• Deployment

Enterprise License

Optimization• Application discovery

• Inventory

• Entitlement management

• Usage collection/aggregation

• Reconciliation

• Optimization

Entitlement & Compliance

Management• Entitlement management

licensing

• Electronic software delivery

• Compliance

• Analytics

Installation• Windows installation

development

• Cross-platform installation

development

Flexera

Software

SolutionsFlexera

Software

Solutions

Market Leading Brands in Each Segment

#1 Market share

Entitlement & Compliance Management

• 3,000+ ISVs and Device Manufacturers

• 200,000,000 PC’s Receiving Software

Downloads and Updates

• 250,000,000 Installations Licensed

#1 Market share

Enterprise License Optimization

• 8 of top 10 Aerospace & Defense

• 6 of top 12 Semiconductor

• 5 of top 10 Oil and Gas

• Over 500 Enterprise Customers

#1 Market share

Software Installation

• 30,000+ Enterprises

• 30,000+ ISVs

• 500,000,000 Installations

#1 Market share

Application Packaging

• Over 1 million applications reliably and rapidly

packaged

• Distributed by 3 of the top 4 PC Life Cycle

Configuration Management Vendors

• 10,000+ Enterprises

The World is Changing

Source: IBM

Source: IBM

Source: IBM

Source: IBM

Source: IBM

What Does This Mean to You (and Us)?

• Implications on applications• Applications everywhere—the cloud, virtual

environments, on-premises

• Smarter applications that connect with and

obtain more timely and complete

information from other apps, sensors, etc.

• Customer expectations for greater

flexibility—subscription, pay-per-use, etc.

• Strategic enablers• Protection of intellectual property

• Flexibility to quickly adapt business models

and deployment methods

• Greater insights into who owns what—

promote cross-/up-sell, maintenance

• Help customers achieve

continuous compliance

Software VendorMarket Trends & Business Challenges

• Market Trends• Mergers & acquisitions on the rise

• New license revenues declining leading to

increase in audits

• Compliance concerns

• Don’t know who their customers are and

what they are entitled to

• Customers increasingly interested in

usage-based models

• Business Challenges• Maximizing revenues

• Ensuring compliance across increasingly

global customer base

• Delivering a consistent experience to

customers

• Managing operating costs

High-Tech ManufacturersMarket Trends & Business Challenges

• Market Trends• Hardware commoditization

• Value migrating to applications

• Devices becoming internet connected

• Functional convergence –

multi-function devices

• Configure-to-order postponement

strategies

• Business Challenges• Monetizing applications and protecting

intellectual property

• Managing a software business in a

manufacturing company

• Delivering customers an excellent

experience

2008 201420122010

18,000

0

2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000

Mobile Devices, Consumer Electronics,

Automobile,

Industrial Machines, Appliances, Toys,

and Other

Embedded Equipment

Traditional Computers & Communications Equipment

Millions of Communicating Devices WW*

* Excludes voice- and SMS-only phonesSource: IDC Device Base Model, 2009

Enterprises & GovernmentsMarket Trends & Business Challenges

Market Trends• Don’t know what apps are owned/used

• Software audits are increasing

• No controls over software spend—ad

hoc contracts and purchases

• Compliance risk—made worse by M&A

• Reduced headcount and budgets

• SaaS, virtualization, cloud

Business Challenges• Buy what you need, use what you have

• Continuous compliance

• Optimize applications at usage level

• Maximize value

Flexera Software’s Role

Applications Have Turned Strategic

Software & Hardware Producers Enterprises & Government

Application Readiness• Application discovery and

identification

• Compatibility testing

• Planning

• Fixing & Packaging

• Deployment

Enterprise License

Optimization• Application discovery

• Inventory

• Entitlement management

• Usage collection/aggregation

• Reconciliation

• Optimization

Entitlement & Compliance

Management• Entitlement management

licensing

• Electronic software delivery

• Compliance

• Analytics

Installation• Windows installation

development

• Cross-platform installation

development

Flexera

Software

SolutionsFlexera

Software

Solutions

Continuous Compliance & Optimization Platform

Producers of

Applications

Portal

Consumers of

Applications

Portal

Contracts & Entitlements

Inventory & Usage

Continuous

Compliance &

Optimization

Portal

SaaS Business Challenges and Strategies

SaaS providers are losing 40-60% of

potential revenues to credential sharing

abuse

SaaS providers have a “one size fits all”

approach to licensing, leaving potential

customers and revenues out

License (e.g. annual, concurrent use etc)

service according to how customers want

to pay for access

Example: ESRI offers a day-pass

for some products

Protect service against revenue leakage

to credential sharing

Many pure-play SaaS companies have

“one-size fits all” packaging resulting in

missed revenues. SaaS business models

need to change on a dime to address an

evolving market.

Example: NetSuite has only two options:

NetSuite and NetSuite CRM+

Package and price offerings to match

what customers want to buy WITHOUT

involving engineering

CHALLENGES STRATEGIES

Announcing: Flexera Software Solutions for SaaSGrowing SaaS Revenues

• Define service bundles based on features

• Create entitlements for service bundles

• Provision SaaS users based on entitlements

• Automate subscription management, up-

/cross-sells

• Gain customer insights on products and version

• Define and enforce license models (e.g.,

concurrent use, annual, trials) and usage policies

• Augment user credentials with machine

identities to formulate license usage policies

• Available today via market leading and proven

FlexNet Publisher (licensing) and FlexNet

Operations (entitlement and subscription

management) solutions

SaaSServices

Sue Jan

High-Tech Mfr Business Challenges & Strategies

Service providers need to provision capacity

to meet peak demand which leads to

unused capacity during off-peak periods

Service providers and branch office

locations need to reduce power

consumption, space and administrative

costs

Consolidate many capabilities into one

device

Allow service providers to dial up/dial

down capacity on-demand without

deploying hardware, eliminating unused

hardware

Device manufacturers face eroding

margins on hardware products

Push hardware costs to end customers

by making device capabilities available as

pure software

Enable up- and cross-sell revenues by

delivering capabilities as software add-ons

or on a trial basis

CHALLENGES STRATEGIES

Announcing: Flexera Software Solutions for Virtual AppliancesProtect Margins, Enable Cross-/Up-sells and Flexible Capacity Models

• Protect intellectual property

• Automate capacity and capability

provisioning and de-provisioning

• Enable field-upgrade of capacity and

capabilities for virtual appliances

• Report deployment of virtual appliances

provisioned to FlexNet Operations

• Automate cross-/up-sells of capabilities

• Compare capacity and capabilities owned

versus deployed by an end customer

• Available today via market leading and proven

FlexNet Embedded (licensing) and FlexNet

Operations (entitlement management) solutions

For more information on our

cloud/SaaS offerings

Tuesday, October 12th

Technical Track – Licensing

11:30 am – 12:30 pm

Taking on the Cloud!

Thank You for Coming!

Please welcome…

Tom Reilly

Chief Executive Officer

ArcSight