Presented by:Ahmar Abbas, Director, Blackboard ASP Services

Managing Mission Critical Applications

Blackboard ASPSM Perspective

April 13, 2005

A word from our lawyers…

• Any statements in this presentation about future expectations, plans and prospects for Blackboard and other statements containing the words "believes," "anticipates," "plans," "expects," "will," and similar expressions, constitute forward-looking statements within the meaning of The Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those indicated by such forward-looking statements as a result of various important factors, including the factors discussed in the "Risk Factors" section of our most recent 10-K filed with the SEC. In addition, the forward-looking statements included in this press release represent the Company's views as of April 11, 2005. The Company anticipates that subsequent events and developments will cause the Company's views to change. However, while the Company may elect to update these forward-looking statements at some point in the future, the Company specifically disclaims any obligation to do so. These forward-looking statements should not be relied upon as representing the Company's views as of any date subsequent to April 11, 2005. Blackboard, in its sole discretion, may delay or cancel the release of any product or functionality described in this presentation.

Agenda

• Requirements of the Networked Learning Environment™

• Five Reasons to Choose Blackboard ASP Services– Reliability– Security– Scalability– Fully Managed Service– Cost Control

• Strategic Role of Blackboard ASP• Summary

The Networked Learning Environment

A true networked learning environment exists when any student or teacher can:

– view instructional content

– collaborate with educators

– evaluate academic performance

– access any learning resources at any time

to achieve their educational objectives.

MISSION CRITICAL

EXPLORATORY

TIME

SUPPORTED STRATEGIC TRANSFORMATIVE:THE NETWORKED

LEARNING ENVIRONMENT

Phase I Phase 2 Phase 3 Phase 4 Phase 5

INS

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ION

AL

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The Blackboard® Applications for aNetworked Learning Environment

Blackboard Learning System

Blackboard Learning System

Blackboard Community System™

Blackboard Learning System

Blackboard Community System

Blackboard Content System™

Blackboard Learning System

Blackboard Community System

Blackboard Content System

BlackboardAcademic Suite™

Blackboard Learning System™–

Basic Edition

Why Consider ASP Services?

MISSION CRITICAL

EXPLORATORY

TIME

SUPPORTED STRATEGIC TRANSFORMATIVE:THE NETWORKED

LEARNING ENVIRONMENT

Phase I Phase 2 Phase 3 Phase 4 Phase 5

INS

TIT

UT

ION

AL

GR

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• Blackboard Applications are no longer “optional”

• 24/7/365 Availability & Support is Mandatory

• Allows Institutions to Focus on Teaching and Learning

• Detailed Risk Assessment

Technology Risk Factors

CostControl

SecurityReliability

ScalabilityFully

ManagedService

Reliability: Build Redundancy & Stability

ASP Infrastructure located in Tier-1 Datacenters at the heart of the Internet (MAEast in Virginia)

Multiple ISP connections to three Tier-1 ISPs for redundant access to Internet & aggregate 2.4 Gbps capacity

Multiple, Redundant Routers, Firewalls, Load Balancers, Switches & Servers

4 levels of power backups for 100% power availability

Climate control for optimal network environment

CostControl

SecurityReliability

ScalabilityFully

ManagedService

Reliability - Network Design

Private Zone Public Zone

Blackboard ASP VA1 Facility

Private Zone Public Zone

Blackboard ASP VA2 Facility

Optical Fiber Ring Connection Between Facilities

Scalability: Build an Environment to Support Growth

• Bandwidth and Storage is Never Capped• Additional Bandwidth on Demand

– Available in 1 Mbps increments• Additional Storage on Demand

– 10 GB unit increments for Learning System– 1 TB unit increments for Content System

• Additional Servers Added as Needs Grow• Additional Active Users Support

– Includes incremental bandwidth, storage and hardware

• Software Updates/Upgrades Made EasyCost

Control

SecurityReliability

ScalabilityFully

ManagedService

Scalability: Add Additional Services as Needed

• Staging Environment– Designed for new release/updates simulation in production

environment before migration to production– Production Environment with full SLA guarantee & backup– 20 GB Storage space– 24 x 7 monitoring & management– No root access allowed

• Test & Development Environment– Designed for “test & development”– Full root access given to clients– Not in production environment– 9 GB storage space– No backup guarantee

• SSL & VPN Services Also Available

Scalability: Complex Hosting Service for High Availability Environments

• Developed for clients requiring high availability and performance oriented solutions: Oracle RAC & Mirrored Dedicated Arrays

• Three Components:– High Availability Infrastructure Design and

Deployment– Dedicated Complex Hosting Engineer/Manager– Business Continuity Service

Scalability: Supporting Growth

Scalability: Business Continuity Service Levels

Recovery Time Objective (RTO)

Recovery Point Objective (RPO)

Customization & Configuration

Locally hosted client:

Weekly backup service 24 hours Last backup less than 8 days

Fully backed up(if possible)

Monthly backup service 72 hours Last backup less than 32 days

Rebuild

Incident-based service 120 hours Latest backup received N/A

Blackboard ASP hosted client:

Level 3 Service 6 hours Last backup less than 3 hours

Fully backed up

Level 2 Service 24 hours Last backup less than 12 hours

Fully backed up

Level 1 Service 72 hours Last backup less than 24 hours

Rebuild

Security: Protect Network and Backup Data

• Physical Security: Tier-1 datacenter security including:– limited access to authorized personnel– identification badges– security cameras– 24x7 on-site security

• Network Security: Including – Firewall & Intrusion Detection System – Full-time Security Engineer – Third Party Audit

• Data Security: Multiple levels of database and file backup

CostControl

SecurityReliability

ScalabilityFully

ManagedService

Security: Data Backups

• 1st level backup:using snapshot technology, file systems & database backed up daily

• 2nd level backup:using NetApp filers, 1st level backups are stored online at separate datacenter for 30 days

• 3rd level backup:weekly backups are stored in tape, off-site for 30 days

Fully Managed Service: 24x7 Operations and Support

• One Stop Client Support from experts who design and host the software

• Services backed up by 99.7% Availability Guarantee – credit issued for violations

• 24 x 7 ASP Support– Dedicated Application Support Manager– Single Point of Contact for Blackboard Software and

Hosting – Two Designated Client System Administrators– Phone, Web and Email based Ticketing System– Escalation and Response Time based on Severity– All Upgrade and Patch Applications Provisioned by

Experienced ProfessionalsCost

Control

SecurityReliability

ScalabilityFully

ManagedService

Fully Managed Service: Backed by Team of Experts

ASP Operations Team: Constantly Expanding in Depth and Breadth of Talent and Skill Set

US Europe Asia

Time01234567891011121234567891011

35 Member Strong Dedicated to only Blackboard ASP Clients Includes DBAs, Network Engineering, Storage Engineers, Operating System Specialist, Backup Technology Specialists 25 Different Technology Certifications including:

Linux OSOracle DBA, Tuning, High PerfApplication AccelerationStorage and Backup MgmtF

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Fully Managed Service: Infrastructure Monitoring and Management

• Key Performance Metrics polled every 5 minutes

– cpu = 5-minute load average– disk = % free on local mount

points– nfs = % free on NFS mount

points– msgs = scanning syslog for key

words– memory = real, virtual and

swap– procs = scanning ‘ps’ output– Obak = Oracle backup status– ofiles = Oracle data/index file

sizes– files = other file/directory sizes– svcs = Windows Services

checking– Application Check for

Response Time

Fully Managed Service: Bandwidth Utilization Report

Cost Control: Lower Costs than Self-Hosted

• By hosting their Blackboard systems through Blackboard ASP Services, institutions realize significant savings when compare to hosting the systems on campus.

• Baseline 3 year savings depend on the type of implementation:– Blackboard Learning System – Basic Edition:

$120,600– Blackboard Learning System: $392,200– Blackboard Academic Suite: $439,200

CostControl

SecurityReliability

ScalabilityFully

ManagedService

Cost Control: Lower Costs than Self-Hosted

One-Time Implementation Costs 36,600$ Service Setup Fee 0$ Server hardware 6,000$ Network hardware 12,000$ Backup hardware 6,000$ Database software license 0$ Monitoring system software 5,000$ Backup system software 5,000$ Implementation personnel $ Staff training 1,000$

Annual Management Costs* 58,000$ Annual Subscription Fee 30,000$ IT Management 30,000$ Application Administration -$ System Administration -$ Database Administration 25,000$ Hardware Administration -$ Bandwidth & Network 3,000$

TOTAL COST OF OWNERSHIP (3 YEAR PLAN)$158,600 + (3 x $126,000) = 210,600$ $20,000 + (3 x $42,000) = 90,000$

TOTAL SAVINGS BY CHOOSING BLACKBOARD ASP SOLUTION: 120,600$

Self-Hosted Blackboard ASP

Includes dedicated application & database servers, network infrastructure, backup infrastructure, monitoring software and systems, Tier-1 data center and professional implementation

Includes 24 x 7 customer support and management, dedicated Application Support Manager, team of database administrators & network engineers

3 Year Total Cost of Ownership Analysis: Blackboard Learning System – Basic Edition

*Assumes a Red Hat Linux/Oracle implementation on Dell Hardware*Assumes 20% of time of personnel is used for ongoing management

1,600

Cost Control: Lower Costs than Self-Hosted

One-Time Implementation Costs 160,200$ Service Setup Fee 0$ 20,000 Server hardware 12,000$ Network hardware 47,000$ Backup hardware 12,000$ Database software license 12,000$ Monitoring system software 20,000$ Backup system software 50,000$ Implementation personnel 3,200$ Staff training 4,000$

Annual Management Costs* 126,000$ Annual Subscription Fee 42,000$ IT Management 30,000$ Application Administration 25,000$ System Administration $ 20,000 Database Administration 25,000$ Hardware Administration $ 20,000 Bandwidth & Network 6,000$

TOTAL COST OF OWNERSHIP (3 YEAR PLAN)$160,200 + (3 x $126,000) = 538,200$ $20,000 + (3 x $42,000) = 146,000$

TOTAL SAVINGS BY CHOOSING BLACKBOARD ASP SOLUTION: 392,200$

Self-Hosted Blackboard ASP

Includes dedicated application & database servers, network infrastructure, backup infrastructure, monitoring software and systems, Tier-1 data center and professional implementation

Includes 24 x 7 customer support and management, dedicated Application Support Manager, team of databse administrators & network engineers

3 Year Total Cost of Ownership Analysis: Blackboard Learning System

*Assumes a Red Hat Linux/Oracle implementation on Dell Hardware*Assumes 20% of time of personnel is used for ongoing management

Cost Control: Lower Costs than Self-Hosted

One-Time Implementation Costs 180,200$ Service Setup Fee 0$ 35,000 Server hardware 18,000$ Network hardware 47,000$ Backup hardware 24,000$ Database software license 12,000$ Monitoring system software 20,000$ Backup system software 50,000$ Implementation personnel 3,200$ Staff training 6,000$

Annual Management Costs* 158,000$ Annual Subscription Fee 60,000$ IT Management 37,500$ Application Administration 31,250$ System Administration $ 25,000 Database Administration 31,250$ Hardware Administration $ 25,000 Bandwidth & Network 6,000$

TOTAL COST OF OWNERSHIP (3 YEAR PLAN)$180,200 + (3 x $158,000) = 654,200$ $35,000 + (3 x $60,000) = 215,000$

TOTAL SAVINGS BY CHOOSING BLACKBOARD ASP SOLUTION: 439,200$

*Assumes a Red Hat Linux/Oracle implementation on Dell Hardware*Assumes 25% of time of personnel is used for ongoing management

Self-Hosted Blackboard ASP

Includes dedicated application & database servers, network infrastructure, backup infrastructure, monitoring software and systems, Tier-1 data center and professional implementation

Includes 24 x 7 customer support and management, dedicated Application Support Manager, team of database administrators & network engineers

3 Year Total Cost of Ownership Analysis: Blackboard Academic Suite

Build-out with Max Headroom

RawNumber Max Space Purchased Raw

EOY of Clients Capacity (TB) Space (TB) Space Used (TB)2004 400 76 24 112005 550 76 24 19.252006 700 76 24 27.5

RawNumber Max Space Purchased Raw

EOY of Clients Capacity (TB) Space (TB) Space Used (TB)2004 400 108 36 14.852005 550 108 36 25.98752006 700 108 36 37.125

Number Max Backup PurchasedEOY of Clients Capacity (TB) Capacity (TB) Capacity Used (TB)2004 400 878 44 442005 550 878 44 772006 700 878 44 110

Number Max # Contracted # Racks AvailableEOY of Clients of Racks of Racks for expansion2004 400 67 10 57 2005 550 67 15 52 2006 700 67 20 47

Blackboard Learning & Content System Storage Outlook

Blackboard Learning & Content System Nearline Storage Outlook

Blackboard Learning & Content System Tape Backup Outlook

Blackboard ASP Co-Location Facility Outlook

Summary: Blackboard ASP Core Offerings

Blackboard Learning System - Basic Edition

Description

• Intel Xeon 3.1 GHz

Multiprocessor Application /

Database Server

• 10 GB of Storage

• 256 Kbps of Bandwidth

• Up to 3,000 Users

• 99.7% Availability SLA

Blackboard Academic Suite

Description

• Intel Xeon 3.1 GHz Multiprocessor

Application Server

• Intel Xeon 3.1 GHz Multiprocessor

Database Server

• Oracle Standard Edition

• Advanced Reporting System

• 20 GB of Storage

• 512 Kbps of Bandwidth

• Up to 8,000 Users

• 99.7% Availability SLA

Blackboard Learning System

Description

• 2 Intel Xeon 3.1 GHz

Multiprocessor Application Servers

• Intel Xeon 3.1 GHz Multiprocessor

Database Server

• Oracle Standard Edition

• Advanced Reporting System

• 40 GB of Storage

• 1 Mbps of Bandwidth

• Up to 8,000 Users

• 99.7% Availability SLA

Summary: Blackboard ASP Value Added Services

Staging Environment Hosting System hosted in production datacenter 99.7% Availability Daily Backups

Test and Development Hosting System hosted in non-production datacenter Client has root access to system No SLA

Virtual Private Network VPN configured and managed by Blackboard 128 Bit Encrypted communication between

Institution and the ASP hosted site

SSL SSL key provided Encrypted access to web pages

High Availability Hosting Oracle 9i RAC based Hosting Redundant Database Servers

Business Continuity Service Host locally or ASP but use Blackboard

ASP services for peace of mind Guaranteed Mean Time to Recover

Complex Hosting Technical Management

Dedicated technical management and support for complex clients

On-Demand Storage/BW Additional Storage and BW service

units

Summary: Blackboard ASP Services Fast Facts

• Over 300 Customers from All Market Sectors

• Over 3 Million Users in our Systems – Over 2 Million Enrolled Users

• 500,000+ Courses

• 1000+ Servers

• 11 Terabytes of Storage Capacity & Growing

• 7 Terabytes of Data Transferred Daily

• 72,000,000 + HTTP Requests Served Per Day

• 99.7% or Better Uptime Guarantee

Expanding & Global Customer Base

Blackboard ASP Institutions

MA

VA

CA

TX

DC

NY IL

FL

PA

MD

NC

LA

WA

OH

NJ

UT

MI

WI

AL

MN

CO MO

OK

TN

GA

NH KS IN

MS DE

NE

AR SC AZ ME

ID CT OR AK

AP

EU

Can

LAC

0

5

10

15

20

25

30

35

State / Region

Insti

tuti

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Summary: Blackboard ASP Services Supporting Key Global Blackboard Clients since 1999

•Pearson plc•Houghton Mifflin•Reed Elsevier•LexisNexis•Thomson Learning

•Mitsubishi Corporation•Morgan Stanley•Manulife Financial•American Bankers Association•Marsh, Inc.

•National Defense University•Naval Postgraduate School•USDA Graduate School•Naval War College•FAO Chile

•Voyager Expanded Learning•KC Distance Learning•Spectrum Pacific Learning•Laureate, Inc.•Kaplan

•Embry Riddle Aeronautical University•University of Miami•San Francisco State University•Georgia Virtual Technical Colleges•Lakeland College

•Fairfax County Public School•Columbus Public Schools•Idaho Digital Learning Net•Second Baptist School•Wichita Public Schools

Publishers Higher Education Government

Corporate Commercial K-12