1. Microsoft Confidential RMS Vertical Bundles Maureen Mascaro RMS Channel Marketing Manager Microsoft Corporation James Watkins Senior Product Manager, Retail Management System Microsoft Corporation

2. Microsoft Confidential Vertical Market Approach  Background  Why Vertical Markets  What we did to validate  Microsoft Response  Marketing  Product  Bundled Solutions  Distribution  ScanSource  Tech Data  Q&A

3. Microsoft Confidential Why Vertical Markets?  Retailers think of themselves as specialized, not general  Results oriented success in vertical marketing  Direct Marketing campaign 2003  Targeted Vertical Trade Show Success  Thriving VARs are able to scale in vertical markets  Repeatable, scalable solutions

4. Microsoft Confidential Sub-Vertical New Lanes Radio, television, other electronics 22,172 Household appliance 19,934 Hobby, toy & game stores 13,872 Convenience, Snack, Specialty Food 84,506 Nursery & garden centers 71,275 Auto and Tire 83,184 Pharmacy & drug stores 50,136 Furniture37,520 Hardware stores 28,964 Books-CD-Music Stores 31,082 Other Specialty NA Sub-Vertical New Lanes Clothing & clothing accessory stores 157,710 Gift, novelty & souvenir 77,996 Beer, wine & liquor 82,046 Sporting goods 43,594 What We Did to Validate  75% to 100% of functionality required is already in RMS  Value in providing sub- segment functionality through ISVs and VARs  Strong sub-industry associations & communities  RMS Partners successful in these sub-verticals   30% of addressable opportunity in the U.S.   Extensive Independent Merchant focus group validation

5. Microsoft Confidential Microsoft Response  Marketing  Targeted Top 4 Vertical Markets  Initial efforts in apparel and sporting goods  Campaigns kick off 11-26  Direct Mail  Industry Publication Advertising  Trade Show Support  Partner Marketing Tools  Key influencer partnerships

6. Microsoft Confidential  Product  Build out bundled solutions  Pilot and test in market  Distributor Input  Service Pack Upgrade (available on PartnerSource)  Major Bug Fixes  Operational Efficiencies  Payment Processing  Bundled Solutions in Market  Standard and Deluxe Bundles for each Vertical Market  Customization and Implementation Guides by market Microsoft Response

7. Microsoft Confidential Bundle Configuration  ScanSource  Standard Bundle  $2999 Suggested Retail  4 Deluxe Bundles  By Vertical Market  Tech Data  Standard Bundle  DigiPOS  Deluxe Bundle  DigiPOS Touch

8. Microsoft Confidential ScanSource Standard Bundle  Sporting Goods Standard Bundle Includes:  Pioneer POS retail specific computer with a Celeron 1ghz processor, 256mb RAM, 20gb hard drive and Windows XP Professional  SAMPO 15 inch LCD display  Cherry 104 key compact keyboard  Epson T88 Receipt printer  MMF Val-U Line Cash drawer  Metrologic Voyager 9520 Barcode scanner  ID Tech Magnetic stripe reader  Cherry Two button power wheel optical Mouse  Required cable/accessories  Microsoft Store Operations single user software  Installation of peripherals and software  VAR Price - $2299  ScanSource Part # MIC-SPORT-S

9. Microsoft Confidential ScanSource Deluxe Bundle  Beer-Wine-Liquor Deluxe Bundle (Pictured)  Includes:  Pioneer POS computer terminal with an integrated 12” LCD touch screen, integrated Magnetic Strip Reader, Pentium III 1Ghz processor, 512mb RAM, 20gb Hard Drive, Windows XP Professional  Cherry 104 key compact keyboard  Epson T88 Receipt printer  APG Vasario Cash Drawer  Epson DM-D110 Pole display  Symbol LS9208 Omni- directional Barcode scanner  Required cable/accessories  Microsoft Store Operations single user software  Installation of peripherals and software  VAR Price - $3546  ScanSource Part # (MIC-BWL- D)

10. Microsoft Confidential Tech Data Standard Bundle  DigiPOS Main System Unit  thermal receipt printer  Metrologic hand-held scanner  15" LCD monitor  customer pole display  cash drawer  Programmable 128 position matrix keyboard  All required cables  Microsoft Store Operations single user software  VAR Price - $2810  Freight Included

11. Microsoft Confidential Tech Data Deluxe Bundle  DigiPOS Main System Unit  thermal receipt printer  Metrologic wireless hand- held scanner  15" resistive touchscreen monitor with mag stripe reader  customer pole display  cash drawer  Standard 104 keyboard  Microsoft Store Operations single user software  All required cables  VAR Price - $3245  Includes Freight

12. Microsoft Confidential Call to Action  Educate Yourself  Implementation Guides  Webinars  Review Distributor Materials  Download SP2 for customers on Software Assurance  Check out the GTM on PartnerSource

13. Microsoft Confidential Questions ?