1. Unified Pricing Across Product Lines: Detail or Driver? Erik Larson Director of Product Management and Marketing Macromedia

2. Handhelds (19m WW) Cell Phones (1b WW) Consumers 1 billion Mobile and Device Users 68 million Business Communicators Presenters & Publishers (35.3m) Meeting & Training Participants (30m) Subject Matter Experts (2.4m) Business Users 5 million Creative Pros Graphic Designers (2.7m) Web Developers (1.8m) Multimedia (0.5m) 8 million Pro Developers 3G Coding (4.7m) Scripters (1.3m) G4 (2.3m) Designers & Developers *WW seat estimates Sources: Gartner, IDC, MetaFacts, Macromedia Market Research Macromedia Target Markets

3. Macromedia Pricing Models Offerings Tools, Suites, Servers, Installed Solutions, Hosted Solutions Models Per PC, Per CPU, Per Named User, Per Concurrent User, Capacity Perpetual, Subscription, Maintenance 12, 24, 36 months Programs Commercial, Education, Government, Non-Profit, Japan, Europe Channels Direct, Disti-Reseller, Reseller, Online-Store

4. Pricing Drivers Customer Desire Business Model Business Strategy

5. Source: IDC, April 2003, N=280, Quicklook Licensing Study, April 2003 Allows me to pay for what I use Allows me to pay for the value I derive Includes large up- front fee plus recurring fee Evenly distributes costs over time 0200400600800100012001400 PLEASE RANK THE FOLLOWING SOFTWARE PRICING MODELS IN ORDER OF ATTRACTIVENESS.

6. Unify Pricing and Business Model Consumer $0$200 Pro Tool $200$2,000 Dev Server $1,000$20,000 Departmental $15,000$50,000 Enterprise $50,000 ConsumerMos to YearsValue AddResellersWks to Mos

7. Death to Line Extensions – Consolidate and Dominate Dreamweaver $299 + UltraDev $599 = ??? Business Performance – Strong Competitive Landscape – On the Verge Business Strategy – Dominate Decision – Results

8. Death to Line Extensions – Consolidate and Dominate Dreamweaver $299 + UltraDev $599 = ??? Business Performance – Strong Competitive Landscape – On the Verge Business Strategy – Dominate Decision – Dreamweaver MX $399 Results

9. Long Live Line Extensions – Go Pro When You’re Already There Flash $399 = Flash $399 + ??? Business Performance – Dominant and Steady Competitive Landscape – Empty Business Strategy – Extend and Grow Decision – Results

10. Long Live Line Extensions – Go Pro When You’re Already There Flash $399 = Flash $399 + ??? Business Performance – Dominant and Steady Competitive Landscape – Empty Business Strategy – Extend and Grow Decision – Flash Professional $699 Results

11. Where Bundles Work – Suites to Raise Share of Wallet 4 Separate Products for $1,596 = ??? Business Performance – Strong Competitive Landscape – On the Verge Business Strategy – Dominate Decision – Results

12. Where Bundles Work – Suites to Raise Share of Wallet 4 Separate Products for $1,596 = ??? Business Performance – Strong Competitive Landscape – On the Verge Business Strategy – Dominate Decision – Studio MX $799 Results

13. Where Bundles Don’t – Tag-Alongs Don’t Grow Share Studio + Contribute = ??? Business Performance – New Product Competitive Landscape – Established and Crowded Business Strategy – Enter and Grow Decision – Results

14. Where Bundles Don’t – Tag-Alongs Don’t Grow Share Studio + Contribute = ??? Business Performance – New Product Competitive Landscape – Established and Crowded Business Strategy – Enter and Grow Decision – Studio Plus with No Price Increase Results

15. Buy Low – Going Low to Enter and Grow Contribute v1.0 = ??? Business Performance – New Product Competitive Landscape – Established and Crowded Per User Discrepancy: Interwoven for $250K or FrontPage for $189 Business Strategy – Enter and Grow Decision – Results

16. Contribute Pricing Data (Per User)

17. Buy Low – Going Low to Enter and Grow Contribute v1.0 = ??? Business Performance – New Product Competitive Landscape – Established and Crowded Business Strategy – Enter and Grow Decision – $99 per seat Results

18. Unify Pricing and Business Model Consumer $0$200 Pro Tool $200$2,000 Dev Server $1,000$20,000 Departmental $15,000$50,000 Enterprise $50,000 ConsumerMos to YearsValue AddResellersWks to Mos

19. Sell High – Pricing to Enter and Expand Contribute + Enterprise = ??? Business Performance – Existing Product, New Market Competitive Landscape – Established and Crowded  Per User Discrepancy: Interwoven for $25K or FrontPage for $189 Business Strategy – Enter and Grow Decision – Web Publishing System  $229 per seat  $2,499 starter pack  $50K + site license Results

20. Sell High – Pricing to Enter and Expand Contribute + Enterprise = ??? Business Performance – Existing Product, New Market Competitive Landscape – Established and Crowded  Per User Discrepancy: Interwoven for $25K or FrontPage for $189 Business Strategy – Enter and Grow Decision – Web Publishing System  $229 per seat  $2,499 starter pack  $50K + site license Results

21. Unify Pricing and Business Model Consumer $0$200 Pro Tool $200$2,000 Dev Server $1,000$20,000 Departmental $15,000$50,000 Enterprise $50,000 ConsumerMos to YearsValue AddResellersWks to Mos

22. Summary Price to Customer Desire Price to Business Model Price to Business Strategy