1. Leveraging CRM as a Platform to Grow Your Business Frank Falcone Senior Product Manager Microsoft Dynamics CRM

2. Truly a ‘Software+Services’ Opportunity - CDN On-Premise 5 year CAGR = -2.0% SaaS 5 year CAGR = 56.0% Projected CRM Spending in Canada (Millions) (SaaS vs. On-Premise CRM Growth) CRM ‘Software as a Service’ continues to gain momentum in Canada and is projected to grow from $13M in 2006 to over $100 M by 2011, a 5-year (‘06-’11) CAGR of 56%. IDC expects that by 2010, over half of all CRM spend will come from SaaS CRM.

3. Truly a ‘Software+Services’ Opportunity - US Sources: *Gartner Dataquest 2006, **Forrester Research, 2007 SaaS CRM revenue projected to grow to 22% of total CRM software revenue by 2010*

4. What this means for you… The market is shifting -From large-scale implementations to agile solutions that drive immediate benefit S+S is a catalyst for change -Perception for buyers is that S+S is more affordable with less risk “Choice” is the best strategy for long-term success -On premise, partner hosted, or Microsoft hosted

5. Monetizing Microsoft Dynamics CRM SoftwarePlusServices Advertise Refer Host Resell Customize Design & Develop Consult Support & Train adCenter Partner Referral Program adCenter Partner Referral Program Live subscriptions Live subscriptions Managed infrastructure and applications Managed infrastructure and applications CRM Licenses CRM Licenses Partner-hosted solutions Partner-hosted solutions Tailored solutions to specific customer needs Tailored solutions to specific customer needs Packaged ISV solutions Packaged ISV solutions Business process and implementation consulting Business process and implementation consulting User/help desk support User/help desk support Training Training

6. PARTNER BUSINESS MODEL Independent Software Vendor

7. Microsoft Partner Business Models VARs add value to hardware and software products by providing consulting, customization, development, integration and support services. Value-Added Reseller SIs create customized solutions by integrating disparate systems and technologies. SIs typically have functional and domain expertise. System Integrator ISVs develop unique intellectual property that they package in a custom application and repeatedly sell to specific industry verticals or customers. Independent Software Vendor Service Providers offer infrastructure and/or application hosting and other services to customers. Service Provider System Builders specialize in assembling complete computer systems based on components from multiple vendors. System Builder Small Business Specialists have expertise in marketing, selling, planning and implementing solutions for small businesses. Small Business Specialist

8. ISV – Example James founded a 25 person software development shop about 7 years ago, based in Calgary, Canada, servicing enterprise and mid-market companies in the oil & gas industry. The company recently released a front-office solution based on Microsoft Dynamics CRM. Partner Level: Certified Number of CRM Customers: 48 CRM Experience: Developing competency Core Strengths:.Net development, oil & gas, back-office systems Focus: Mid-market, enterprise, oil & gas Amount (USD) Oil and Gas Solution - 25 seats$55,000* ISV Royalty Fees($10,500) Software maintenance & support$11,000* Implementation and training (100 hrs) $20,000* TOTAL:$86,000 Seats: 25 Time To Implement: 1 month Why James likes to work with Microsoft CRM: Great revenue and margin opportunities – Attractive royalty schedule based on volume Solid product –Rich platform, takes advantage of.Net, Office Client and Server, SQL for reporting, and business intelligence –Ease of development (Visual Studio,.Net, Workflow) –Flexibility of deployment (on-premise and hosted) Great support – Training, certifications *88% of revenue flows directly to ISV

9. PARTNER BUSINESS MODEL Service Provider

10. Service Provider – Example Claus works for a 250 person infrastructure and application hosting company based in Denmark. His company hosts and manages email and business applications on behalf of companies based in Denmark, UK and the Netherlands. He partners with SIs for the consulting and customization work, as well as ISVs. Partner Level: Gold Certified Number of Customers: 1,500+ CRM Experience: 4 years Core Strengths: Infrastructure and application hosting, hosted Microsoft Exchange, Microsoft SharePoint and Microsoft Dynamics CRM Focus: Mid-market, manufacturing, financial services Amount Private Label – 50 seats@€68 per seat, per month, 24 months contract €81,864 Hosting Fees€42,978* Microsoft SPLA Fees(€24,559) Implementation and training by CRM Partner (200 hrs) €27,288 TOTAL:€109,152 Why Claus likes to work with Microsoft CRM: Great revenue opportunities – Recurring fees from customers/private-label partners Solid product – Built on Microsoft stack with multi-tenant capabilities – Common application platform for ISV solutions – Integration with SharePoint, Exchange Great support – Large partner ecosystem, hosting documentation and tools ** In this example, CRM Partner sourced the deal, owns the customer and invoices them. CRM Partner pays the Service Provider a recurring monthly fee for hosting services. Currency conversion rate of.6822 used on invoice example. Seats: 50 Time to implement: 30 days Private Label Model** Seats: 50 Time to implement: 30 days Amount Hosted CRM – 50 seats@€68 per seat, per month, 24 months contract €81,864* Platinum support – 20 seats@€10 per seat, per month, 24 month contract €4,800* Microsoft SPLA Fees(€24,559) TOTAL:€86,664 Direct Model *53% of hosting revenue flows to SP *72% of hosting revenue flows to SP

11. Rapid implementation Anywhere-access Low, per user monthly fee CRM Online Control & ownership Technology investments Advanced integration On-Premise Partner Hosted Outsourced IT Industry / Vertical configuration Packaged solutions The Power of Choice

12. Dynamics CRM: The Power of Choice On- premise CRM Online Partner Hosted Single code-base across all offerings! Single code-base across all offerings!

13. Microsoft Dynamics CRM Online 5 – 25 users 26 – 150 users 151 – 250 users NO-IT Organizations WorkgroupsDepartments Small Businesses Resource Constrained IT DepartmentsDivisions Mid-market Organizations Resource Constrained IT DepartmentsDivisions Enterprise S+S Pioneers Pilots “Perfect Fit” “Great Fit” “Good Fit”

14. The Partner Opportunity Be part of the transition from on-site to S+S –Sell and service Microsoft CRM on-site while you learn the new market for CRM Online Diversify Revenue Sources –Microsoft Services Annuity –Partner Services –Standard license margin for on-premise

15. The Partner Financial Model The Partner Financial Model Annuity-based model for partners Partners will receive recurring annual compensation for customers that they deploy on the Live CRM platform Partners will receive 10% of the service revenue for each user, with a special rate of 15% per user in 2008 Payments will be made in advance on the first year of 12 & 24 month contracts In addition, partners can also receive standard software margin if the customer chooses to move on-premise

16. Innovation, Investment & Partners Microsoft Dynamics: 291,000+ customers 10,000+ partner ecosystem Footprints in 132+ countries 20+ years experience Microsoft Dynamics: 291,000+ customers 10,000+ partner ecosystem Footprints in 132+ countries 20+ years experience Microsoft: Three Aligned Business Units Delivering Integrated Innovation 57,000 Employees 27,000 designers and developers $7.6B in R&D History of Pioneering Software Innovation Microsoft: Three Aligned Business Units Delivering Integrated Innovation 57,000 Employees 27,000 designers and developers $7.6B in R&D History of Pioneering Software Innovation

17. Microsoft Data Center

18. 30 Day Free Trial of CRM Online https://offers.crmlive.com/canadapromo

19. DEMO The Power & Flexibility of the Dynamics CRM Platform

20. Thank you!