wind river
TRANSCRIPT
Gareth NoyesDirector, Corporate Operations
Wind River Systems, Inc.
Next Generation Pricing Next Generation Pricing StrategiesStrategies
Vision, Challenges and Best PracticesVision, Challenges and Best Practices
What We Do: Device Software OptimizationWhat We Do: Device Software Optimization
Wind River enables companies to develop and run device software faster, better, at lower cost and more
reliably.
Customer MomentumCustomer Momentum
Networking Industrial & Automotive Aerospace & Defense Digital Consumer
AlcatelCiscoEMCEricssonFujitsuHitachiHewlett-PackardHuaweiIntelJuniperLG ElectronicsLucentMarconiMotorolaNECNokiaNortelSiemens
ABBAgilentBoschFanucGEHitachiHoneywellMitsubishiNational InstrumentsOmronRockwell AutomationSamsungSchneiderSiemensTektronixTokyo ElectronYokogawa
BAE SystemsBoeingEADSEuropean Space AgencyGeneral DynamicsHarrisHoneywellIAIKHILG InnotekLockheed MartinL3NASANECNorthrop GrummanRaytheonThalesSmiths Aerospace
AlcatelBMW CanonEricssonFujitsuHewlett-PackardHitachiHondaKonica MinoltaLG ElectronicsMatsushitaMotorolaPhilipsPioneerSamsungSeiko EpsonSonyThomsonToshiba
300 Million devices worldwide use Wind River technology
37% 20% 24% 19%
Wind River Offering Circa 2002Wind River Offering Circa 2002
Challenges for GrowthChallenges for Growth
PRODUCTS– “Chinese Menu” commoditise value
SALES– Transactional, project-based approach
BUSINESS MODEL– Rigid: perpetual, project-based– Unpredictable, difficult to forecast
OPERATIONS– Transactional
Horizontal,“One-size-
fits-all”
Our ResponseOur Response
Market-specific product offering
Focus on Enterprise-level standardisation
Expanded business model, licensing options– Subscription business model– Unique-User licensing option
Operational focus on ease of doing business– Assist customers with compliance– Entitlement varies over time
Today:Today: Wind River Business Model Choices Wind River Business Model Choices
Business Model License ManagementOptions
Production LicenseOptions
Subscription
Perpetual
Node-Locked
Floating
Unique User *
PL-FREE
Quarterly in Arrears
Block Purchase
Block Purchase
Per Unit
Node-Locked
Floating
* Utility pricing, requires reporting
Business Model AdoptionBusiness Model Adoption
Launched November 2003
FY05 revenue of $235.4 million– Revenue growth of 15% year-over-year– Record subscription revenue of $49 million—
156% growth year-over-year
Deferred revenue balance of $77.1 million– Increase of 97% vs. ending FY 2004 balance
Insights / Lessons LearnedInsights / Lessons Learned
Treat business model & licensing options as you would a product line– Roadmap, transitions, migration paths
Align pricing / licensing with value
Understand the implications– Revenue– Company-wide commitment– Change Management– Reporting trepidation
Operationalise business model: process integration– Many more licensing touch-points
New Challenges: New OpportunitiesNew Challenges: New Opportunities
A new business era– Compliance & controls
Open Source– Changes vendor value proposition– Community licensing terms
Innovation vs. standardisation
Accelerating software commoditisation– Open source & standards
Operational best practiceOperational best practice
Overview of Wind River operations
Licensing / Packaging TenetsLicensing / Packaging Tenets
Installation / use to match business model
Make licensing transparent to developer
Restrict enable & control
Make compliance easy
Self-service licensing cycle
Product Installation ParadigmProduct Installation Paradigm
Developer
System Administrator
ServerWind River
License Servers
DeveloperDesktop
1 INSTALL & DEVELOP
Select either temporary or permanentEnter installation code (LAC) & user detailsReceive automatic 30-day licenseUp & Running
2 COMPLETE SETUP
Migrate to license server when readIssued new license file: port@server
3 UPDATE
Download patches, updates
1 LICENSE SETUP
Receives entitlement certificate w/ shipmentUse PAWS to generate license filesCommunicate availability to installed developers
2 ENTITLEMENT
Redeploy licensesManage renewals, upgrades
3 COMPLIANCE
Report usage
ESD
MediaKit
Developer: Installer OptionsDeveloper: Installer Options
Activate your products
View software entitlement
Customer BenefitsCustomer Benefits
Reduction in licensing administration
Improved time to productivity for developers
Greater visibility / control over software deployment– Track and manage licenses– Measure compliance
Insights / Lessons LearnedInsights / Lessons Learned
Standard ERP & CRM packages do poor job of managing intangibles– Entitlement = tangible x licensing
Customer role segmentation– OOB lifecycle analysis post shipment
Customer self-serve when they can
Gain greater insight into software deployment habits
Next Generation Pricing Strategies
Vision, Challenges and Best Practices