SMB Partner Incentives. Level 100 Speaker:

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1 SMB Partner Incentives Level 100 Speaker:

2 Agenda What You Will Learn Topics Understanding of the incentives available to Commercial Distributors in FY15 Insight into the incentive framework and the components within the framework Guidance regarding the usage of earned incentives to drive growth SMB Channel Incentive Strategy The SMB Channel Incentive Framework The Business Opportunity Incentive Rates & Accelerators Coop as a Key Enabling Component Alignment with Microsoft Priorities

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4 FY15 SMB Licensing Incentives Framework SMB incentives. serve as a catalyst for solid growth worldwide for both commercial & public sector business support the various partner communities that most impact the SMB business incorporate coop funds to provide an attractive investment opportunity for the BGs and support partner profitability combine corporate-defined and locally-chosen elements to provide consistency as well as flexibility Globally- Applied Incentive Components Managed Resellers Incent on all Open Revenue Rebate and Coop Elements Open VL Core Growth Incubation Cloud via Open Attractive rates for both Growth & Incubation products Open Annuity contracts incented at >3X Open L for Growth & Incubation products Attractive rates for Cloud products via Open Commercial Distribution Incent on SMB Open Revenue (except Cloud Revenue) Rebate and Coop Elements Open VL, Office FPP/ ESD Core Growth Incubation Cloud via Open Rates increase for both Growth & Incubation products Open Annuity contracts incented at >3X Open L for Growth & Incubation products Attractive rates for Cloud products via Open Corporate IT Academy Accelerators Incremental Incentive for select IT Academy product sales Solution Workload Accelerator Incremental Incentive for Certified DISTIs Locally Chosen Accelerators Cloud Open Reach Open Renewals Cloud Open/ESD Reach Cloud Growth Selected At Area Level (or EU/EFTA) Cash Back Windows Server GeoX Pilot Open Renewals

5 FY15 SMB Partner Incentives Focus Strategy Evolution Cloud Acceleration Scale Reach & Open Renewal Focus Key FY15 Incentive Highlights Increase Year-over-Year SMB CI budget Maintain Global Incentive Framework Maintain Strong Cloud Incentives Best Rates for Growth & Incubation in Annuity Maintain DISTI Solution Accelerator for Cloud Align Accelerators to Cloud Business Strategy Maximizing SMB Incentives in FY15

6 Maximizing Distribution Incentives in FY15

7 Partner Participation in Commercial Distribution Incentives Get More Value Out Of Your Microsoft Partner Network Competency Broaden partner Cloud/Solution offerings into high-growth market segments Use Coop to grow top-line revenue with increased demand creation activities

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9 Eligibility Requirements for Commercial Distribution competency Earn Microsoft Partner Network requirements as defined for authorization as a Microsoft Distributor. additionally Have a Distribution agreement with Microsoft Channel authorization specifying entitlement to sell finished goods products Authorization agreements detailing the licenses for products (Open, FPP, ESD) it is allowed to sell. Earn Microsoft Partner Network requirements as defined for authorization as a Microsoft Distributor. Once a partner has been designated by Microsoft as a Commercial Distributor, they automatically become eligible to earn incentives as soon as the program letter is signed by the partner.

10 Eligible Revenue-DISTI (On-Premise) core Office Office for Mac Exchange Server & CAL Other MOD MOD CAL Suites Core CAL CnE CAL Suites Core CAL Windows Client Windows Legalization Windows Server Other Windows Server Standard Windows Server CAL Windows Remote Desktop Services growth BizTalk Server Developer Tools Dynamics CRM MOD CAL Suites ECAL MS Learning and IT Pro Subscripts (IT Academy) Project SharePoint Server and CAL SQL Server Standard and CAL SQL Server Premium STB CAL Suites ECAL Visio Windows Server Datacenter Incubation Lync Server & CAL Lync Plus CAL System Center Client System Center Server Identity and Access Windows MDOP commercial/govt academic Incentives are based on the following pricing levels and licensing types: Open L or L&SA Open Upgrade Open SA Renewal Open Value - new, renewal OVS - new, renewal Office 365 Open Academic OVS-ES - new, renewal School new, renewal

11 Cloud via Open Offers Plans License Type Length of Subscription SKU Bundle 5 Incentive Rate (Based On Billed Revenue) Lync Online Plans 1 & 2 Exchange Online (including Protection& Archiving) Plans 1 & 2, Commercial, Government, Faculty and Student, Archive, Encryption, Protection, Forefront Online Protection Office 365 Enterprise Plans E1, E3, E4, A2-A4 Commercial, Faculty and Student, E1 Archiving Office 365 Midsize Business Office 365 Pro Plus Project Online M All seat definitions Commercial, Faculty, Government and Student Project Online, Project Lite, Project Online with Project Pro O365, Project Pro for O365, Project Online for Students and Faculty Open, Open Value, Open Value Subscription, Campus/School 12 months (Paid Up-front) Single User 8% SharePoint Online Plans 1 & 2 with Yammer, One Drive Business w/office Online, Extra File Storage, Yammer Enterprise Visio Online Visio / Visio Pro Commercial, Faculty and Student Power BI Commercial, Faculty and Student Azure via Open Commercial, Government, Faculty and Student Enterprise Mobility Services Windows Intune, Enterprise Mobility Suite Office 365 Small Business Premium Office 365 Small Business Premium ESD

12 Commercial Distribution Grow Top-Line Open Revenue and Improve profitability through coop funds corporate-defined component global accelerators IT Academy Legend Non-Annuity rate locally-chosen accelerator list 2.5% Annuity 1.5% 7% Annuity 2% 12% Annuity 4% Core Growth Incubation 8% Cloud Annuity Rate Coop/ Rebate split 50%/50% Coop/ Rebate split 33%/67% Cloud Revenue Growth Cloud Partner Reach Open Renewal All Tiers GeoX Reach Paid on New & Renewal Open License agreements On-premise incentives paid on revenue sold to SMB customers Cloud incentives paid on revenue sold to customers in all market segments Open on-premise revenue excludes Tier 1 Reseller Revenue

13 Azure via Open Incentive & Promotion Announcing For FY15 Microsoft Azure Base Channel Incentive 8% + Special FY15 Incentive 12%* Total of 20%* * Until 3/31/2015, for Commercial Distributors and eligible Managed Resellers. Special 12% promotional incentive paid on sales to SMB customers only.

14 Global IT Academy Accelerator Global accelerator of 7% on sales of defined IT Academy products sold via Open Commercial Distributor Measurement Rate Rebate Portion Coop Portion IT Academy OVS and Open Academic revenue sold to Tier 2-4 resellers of IT Academy part numbers 54R-00141, 54R-00142, 54R-00159, and 54R % 100% 0% Microsoft Academic Certifications Site pack of 500 Microsoft Office Specialist (MOS) exams Site pack of 250 Microsoft Technology Associate (MTA) exams OVS-ES (Level E) H5T % 100% 0% OVS-ES (Level F) H5T % 100% 0% OVS-ES (Level E) H5T % 100% 0% OVS-ES (Level F) H5T % 100% 0% Class pack of 30 Microsoft Certified Professional (MCP) exam vouchers OVS-ES (Level E) H5T % 100% 0% OVS-ES (Level F) H5T % 100% 0% Open Academic H5T % 100% 0%

15 FY15 H1 DSA Program DISTI attains Eligible Competency by Jun 13 th 2014 DISTI sells solution workloads through Resellers DISTI is enrolled in DSA for FY15 (Done by Ops) DISTI receives DSA incentive (10% of invoice value for eligible products) - 50/50 Rebate/Coop Workload Disti Competency (Silver or Gold) Eligible Products Min Required Products in an single order (Invoice) Virtualization and Management Virtualization and Management Windows Server Datacenter System Center Server 3 Servers (any mix) from: Windows Server Datacenter System Center Server Standard System Center Server Datacenter Virtual Desktop (BYOD) Server Platform Windows Remote Desktop Services Windows Server Standard Windows Server Datacenter 1 Windows Server Standard OR 1 Windows Server Datacenter AND 25 Windows Remote Desktop Services CALS Business Analytics (On-Premise) Business Intelligence SQL Server BI Edition SQL Server Enterprise Core ALM Solutions Pro Developer Tools SharePoint Server, SharePoint CAL Windows Server Datacenter Windows Server Standard 1 SQL BI or 2 SQL Enterprise Core (4 Cores) AND 1 of the following servers:- - Windows Server Standard - Windows Server Datacenter - SharePoint Servers Business Analytics (Online) Power BI in Open: Power BI in Open: 5 users Unified Communications Communications Lync Server, Lync CAL SharePoint Servers, SharePoint CAL 1 Server (Lync or SharePoint) AND 25 CALs (Lync or SharePoint) Important: A product qualifying for multiple DSA workloads on a single order will only be paid once for incentive earnings. CALL TO ACTION Use the DSA Incentive Estimation Tool to determine potential incentives your DISTI can earn Work with your DISTI to get MPN Certification on or before Jun 13 th 2014 (no exceptions) Build a plan to drive execution using the DSA Execution Guide and Playbook

16 Understanding Coop Coop Activities FY15 Incentives

17 Earning and Usage Periods Earn DISTI & Managed Reseller Incentive programs run on a 6 month program period. Accrued funds are calculated based on eligible revenue from previous fiscal half, and calculated per the rates and terms of the program agreement. Per program calculation against eligible revenue Rebate + Coop Distributor Incentives Managed Reseller Incentives H1 Program Period (1 JUL -31 DEC) Jul Aug Sep Oct Nov Dec Q1 15 August Q2 Funds Available = Rebate Payment and Coop available for Previous Fiscal Year s H2 earnings H2 Program Period (1 JAN -30 JUN) Jan Feb Mar Apr May Jun Q3 15 February Q4 Funds Available = Rebate Payment and Coop available for Previous Fiscal Half earnings Extends to next fiscal year H1 Program Period Partner is eligible to earn rebates and coop funds through sales of eligible licenses and products during the Earning period (6-month) When partner meets all requirements, rebate and coop funds are then AWARDED for Payment & Usage. Rebates are paid automatically and coop funds are paid against eligible activity claims. Partner claims earned coop funds after an eligible market development, demand generation, or readiness activity is performed during the 6-month USAGE period.

18 Eligible Coop Activities Commercial Distributors demand generation Online Advertising Web Advertising Direct Mail Direct Mobile SMS market development Customer Offers & Incentives Telemarketing Services On-site Champs Tradeshows Internal incentive & SPIFFs E-Commerce Proof of Concept Services Bootcamps Seminars Multi-Vendor Expositions Social Media or Mobile Commerce Web Syndication Search Engine Optimization partner readiness Microsoft Training Tuition fees MPN Registration Fees Microsoft Exam Fees Microsoft conference registration fees Microsoft On-site Sales Training, including Floor Day Expenses Microsoft Conference Travel & Hotel Product Demo/Seed Units

19 Principles of Coop Pay for Performance Earn funds then use funds Conduct activity then claim reimbursement Predictable Funds grow as business grows Clear performance lever computation of funds earned Support Business Goals Gain Channel mindshare and preference for Microsoft Accelerate Sales Span Partner Engagement Lifecycle Many Coop eligible activities such as readiness and enablement, demand generation and selling Leverage Distributor s Capabilities DISTIs have existing assets to reach and activate resellers: Web and Telesales engine, In-house licensing and sales expertise, Reseller database, etc.

20 Guidelines for Coop Prominently displayed Coop tagline in Demand Generation and some Market Development activities Prominently displayed Company/Brand name and Contact information In Demand Generation and some Market Development activities. Minimum 30% Microsoft content that furthers the marketing and promotion of Microsoft software in Demand Generation and Market Development activities Key Exclusions Promotion of Competitors Capital Expenditures Administrative Costs/Overhead T&E (except as outlined for limited events such as WPC)

21 Field Partner Ops/IT/Claims Corp Prepare & Plan DPAM/PSMM Take Training Develop Quality Mktg Plans On-boarded to CHIP Contracts in place On-boarded to CHIP Trained on Program/Tool Coop Funds Visibility Quality of Marketing Plans Contracts/Notices in place Funds Calculation and CHIP Upload/Configuration. Timely Onboarding of Partners and Field. Program Design Program Guideline Dev t Marketing Plan Guidance Readiness Content and Delivery Approve Plan Get CHIP Access DPAM Timely plan approval PSMM drive plan quality Encourage Program compliance Submit MD Plan for review Execute After Approval Follow Program Guidelines Use Preapproval Option CHIP Issue Resolution CHIP Activity Reporting Notifications/Override on plan approvals Creative Piece Pre-approval Funds Tracking Execute Activity PSMM Ensure Execution plan is delivered. Provide resources/templates and program guideline consultations. Execute according to approved plan and program guidelines Gather POE materials Respond to program guideline questions Notices/Reminder on Claim Submission Campaign Resources Program Clarification Encourage immediate claim. Review Claim Rates in DHI, QBR or Monthly Reviews Submit claims on CHIP as soon as activity is completed CHIP Issue Resolution CHIP Activity Reporting Reminders -Claim Submission Funds Tracking Program Status Reporting Submit Claims Offer clarifications/context or exception justification when necessary. Provide adequate POE to prove guidelines have been met. Review/Audit of Claims and POE Handle Exceptions Evaluate Exception Cases Program Status Reporting Validate Claims Review ROI Impact of execution as part of monthly reviews and QBRs with DISTI Review ROI Impact of execution and adjust activity mix as needed. Approved Claim Payments CHIP Issue Resolution CHIP Activity Reporting All up ROMI/ROI Analysis Program Status Reporting Results Review Note: Figures exclude North America; Legend: Green DISTI Action; Blue Field action; Purple Corp Action

22 SMSP Disti Coop Category Recommendation Category Activity Examples % Coop MPN Gold Membership fee Partner Readiness WPC Conference Fee 10% Demand Generation Market Development Tuition and Certification Exams Web Advertising* Campaign* Boot camp Events/Seminars 20% Internal Spiff Online Syndication* E-Commerce* Social Media and Mobile Commerce* On-Site Champs Telemarketing campaign Promo Offer/Reseller Contests 20% 50% SMSP Disti Coop Product Recommendation Products % Coop Windows 20% Office % Server & Tools 30% SMSP Disti Coop Digital Marketing

23 Attach O365 Continue Windows XP Upgrade Land Cloud SureStep Drive Cloud Renewal, Cross Sell/Upsell & CLTV Launch Azure in Open Land Cloud SureStep Drive WinSvr 2003 EoS Upgrade Windows Server Hyper-V Deployment Azure Billed Revenue Drive SQL Server through Power BI SQL Server Premium Billed Revenue Office 365 Pro Plus Deployments Open Renewal Rate

24 Q & A

25 Thank You!

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