CRN | Keep It Simple: Microsoft Draws Up New Licensing, Financing Policies: "Changes are afoot for Microsoft's SMB licensing and financing policies. And the common theme is simplification.
Among other things, the vendor is collapsing best practices from multiple regional efforts into a single, worldwide Open Value licensing program.
Moreover, Microsoft is streamlining its license ordering process. That includes a move away from a controversial program adopted several years ago under which traditional resellers (dubbed Microsoft Software Advisers) were required to work with Authorized License Providers, typically distributors, on licensing deals and were paid a fee for that work. Now, partners can resell Open Value contracts and set their own margins again. Open Value contracts apply to deals of 250 desktops or fewer.
>> 'Licensing terms and complexity affect us. If [Microsoft] can simplify licensing, it will make it easier for customers to buy software through partners.'
�YACOV WROCHERINSKY, INFINITY INFO SYSTEMS
'If you look at some of the things we had in the past, a lot of these one-off singular vertical decisions absolutely made sense either for the customer segment or the business we had. And then over time, the cumulative effect of that is not necessarily great,' said Brent Callinicos, corporate vice president of Worldwide Licensing and Pricing at Microsoft, Redmond, Wash"
Friday, July 15, 2005
Europe's Patent on Failure
Europe's Patent on Failure: "Europe's Patent on Failure
EU legislators' inability to find common ground on protecting software innovation will do serious harm to the Continent's tech sector
A proposed law to create Europewide rules for patenting software was soundly defeated July 6 in Strasbourg, France, after five long years of wrangling among the European Commission, the European Parliament, and aggressive lobbyists. In the wake of 'no' votes in France and the Netherlands on the proposed European Constitution, and a bitter rift over the European Union budget in Brussels, the patent fiasco fuels a deepening sense of crisis in Europe. Advertisement"
EU legislators' inability to find common ground on protecting software innovation will do serious harm to the Continent's tech sector
A proposed law to create Europewide rules for patenting software was soundly defeated July 6 in Strasbourg, France, after five long years of wrangling among the European Commission, the European Parliament, and aggressive lobbyists. In the wake of 'no' votes in France and the Netherlands on the proposed European Constitution, and a bitter rift over the European Union budget in Brussels, the patent fiasco fuels a deepening sense of crisis in Europe. Advertisement"
The Sarbanes-Oxley Software Race
The Sarbanes-Oxley Software Race: "The Sarbanes-Oxley Software Race
Providing companies with advanced programs for keeping tabs on financial activity is as hot as a market gets. And so far Virsa is in the lead
Sarbanes-Oxley compliance may be costing the average large company $7.8 million, 70,000 man hours, and countless headaches. But one company's nightmare is another's gold mine.
When entrepreneur Jasvir Gill first heard "
Providing companies with advanced programs for keeping tabs on financial activity is as hot as a market gets. And so far Virsa is in the lead
Sarbanes-Oxley compliance may be costing the average large company $7.8 million, 70,000 man hours, and countless headaches. But one company's nightmare is another's gold mine.
When entrepreneur Jasvir Gill first heard "
Wednesday, July 13, 2005
ROI Analysis Tools
Integration Technology ROI Financial Analysis Tool by Nucleus Research Featured Sponsorship - KnowledgeStorm: " ROI Financial Analysis Tools "
SandHill.com | Sales & Marketing | Software that Makes CIOs Happy
SandHill.com | Sales & Marketing | Software that Makes CIOs Happy: "Software that Makes CIOs Happy
Software that Makes CIOs Happy
Top IT executives from Unilever, BP, Lockheed Martin and Kaiser Permanente provide insights on what software vendors can do to improve their product offerings.
Maryann Jones Thompson, Sand Hill Group
Jul 05, 05
Most I.T. buyers would say that software vendor behavior has improved over the past 5 years. Since the recession when businesses dramatically slashed I.T. budgets, software companies have had no choice but to improve customer relations and product quality in order to remain competitive.
But CIOs speaking at Software 2005 say there is still much room for improvement in software buyer-vendor relations. The panel consisted of the key I.T. executives from major corporations:
* Neil Cameron, CIO, Unilever
* John Leggate, Group VP for Digital Business, BP
* Ed Meehan, COO Information Services, Lockheed Martin
* David Watson, CTO, Kaiser Permanente
Moderator Ernest von Simson, senior partner at Ostriker von Simson, prompted the panelists to speak on "hot button" issues such as consolidation and pricing. The discussion identified a list of "to-dos" for vendors which would make CIOs worldwide "happier" with software products.
Improve Quality
The panel was unanimously unimpressed with product quality. "The quality of software I receive from you is abysmal," says Kaiser's Watson. "I'm in a business where if I put in a bad piece of software, I can actually kill people. We take patient safety and software quality extremely seriously. I need partners that take it just as seriously as we do."
Hospitals are not the only clients with life or death accountability. "At Lockheed Martin, we have more lines of code than Microsoft in the products we deliver," says Meehan, complaining that the enterprise software vendors he purchases from do not have the same standards of quality. "The difference is that our products have to work because we have lives at stake, missions at stake."
Add Value, Not Complexity
"Most software adds complexity," says BP's Leggate, speaking for many critics of the enterprise software business. "We're looking for software that adds unique value to our corporation."
"The complexity forces companies to invest in maintenance and integration work which seems to have no return for the business. This places the CIO in a bad position," says Unilever's Cameron. "All other parts of the business can negotiate away expenses with no ROI... It makes me not want to buy software."
Build Dialogue
Software vendors have long been criticized for a lack of strategic, consultative selling. The CIO comments seem to indicate that vendors are trying to be true business partners - but not quite there yet. "Please don't tell me you're going to solve all my problems. Vendors are continually using that pitch," says Cameron. "Ask me what my problems are."
Adds Leggate, "If you're going to set out to build good stuff, come and talk to me first," We want to work with companies at a level of strategy, not at a level of selling boxes and disks."
Be Flexible
All panelists expressed an interest in new vendor business and pricing models. "The ASP model was static," says Watson. Buying software as a service allows enterprises to purchase more than just an application; it can also come with an additional piece of intellectual property. "Software as a service is more flexible."
As vendors increasingly focus on service or subscription models, it is important to remember that all customers may not want the same model - or the same model every time. Adaptability is key. "We like to go to our vendors and say, 'Can you do it this way?'" says Meehan. "Most of the time, it works out."
Embrace Reality
Even at companies with large IT budgets, funds available for new initiatives are still scarce. Meehan explains Lockheed Martin has grown 13 percent over the past 10 years but the IT budget has only grown 1 to 1.5 percent.
BP has a similar situation. "The headroom for new software is only $10, $20, $30 million a year," says Leggate of BP's budget. "We care deeply about innovation. But we need things that fit our business and take our company forward but not cause integration problems."
Smooth Merger Impact
Too often, customers are bearing the brunt of industry consolidation. "I don't know how many times I've been negotiating for a product, purchase one and then end up with the other because of an acquisition. You think you know what you're buying but then you have to factor in what's going to change as a result of the acquisition," says Meehan. "We look for value, ease of use, ease of dealing with company and flexibility in our deals. The consolidation going on in the industry adds another layer of complexity."
Enhance Security
IT security remains a tremendous challenge for enterprises. Software vendors need to do more to help fight the battle. "Today I am spending tremendous amounts of money to protect the business environment," says Meehan. Lockheed Martin tracked 56,000 viruses two years ago. Last year that figure hit 10 million. The ramifications of the situation are huge. "How can we get 130,000 people patched against a vulnerability before the hacker community figures out how to exploit it?"
Share Responsibility
"I'm looking for [vendors] to have some skin in the game," says Watson. "When it works, I'm happy to pay you because I like 'win-wins.'" But too often when it doesn't work, vendors wrap themselves in warranty provisions and eliminate their downside. "I don't believe that is a fair exchange in value."
Speed Industry Evolution
Buyers appreciate that the software industry is maturing and evolving. But the dynamics and timing of the evolution are frustrating. "We're all looking to see the future and bring the future forward," says Cameron. "When we see the future, our biggest frustration is 'How do we get there faster?' What we've got is SOA and I won't live to see it - and I'm young... So we have to get after these things faster so that we can bring them to the business and see the benefit."
"If you can [provide a solution] in 4 months for less than a million dollars, I'm ecstatic," says Meehan. "I think the technology is moving in that direction. We don't have time for the two-to-three year, multimillion dollar engagement anymore. We're expecting quick solutions to real business problems."
Maryann Jones Thompson is editor of SandHill.com. To view the entire Software 2005 CIO panel, visit the post-conference video page click here.
Software that Makes CIOs Happy
Top IT executives from Unilever, BP, Lockheed Martin and Kaiser Permanente provide insights on what software vendors can do to improve their product offerings.
Maryann Jones Thompson, Sand Hill Group
Jul 05, 05
Most I.T. buyers would say that software vendor behavior has improved over the past 5 years. Since the recession when businesses dramatically slashed I.T. budgets, software companies have had no choice but to improve customer relations and product quality in order to remain competitive.
But CIOs speaking at Software 2005 say there is still much room for improvement in software buyer-vendor relations. The panel consisted of the key I.T. executives from major corporations:
* Neil Cameron, CIO, Unilever
* John Leggate, Group VP for Digital Business, BP
* Ed Meehan, COO Information Services, Lockheed Martin
* David Watson, CTO, Kaiser Permanente
Moderator Ernest von Simson, senior partner at Ostriker von Simson, prompted the panelists to speak on "hot button" issues such as consolidation and pricing. The discussion identified a list of "to-dos" for vendors which would make CIOs worldwide "happier" with software products.
Improve Quality
The panel was unanimously unimpressed with product quality. "The quality of software I receive from you is abysmal," says Kaiser's Watson. "I'm in a business where if I put in a bad piece of software, I can actually kill people. We take patient safety and software quality extremely seriously. I need partners that take it just as seriously as we do."
Hospitals are not the only clients with life or death accountability. "At Lockheed Martin, we have more lines of code than Microsoft in the products we deliver," says Meehan, complaining that the enterprise software vendors he purchases from do not have the same standards of quality. "The difference is that our products have to work because we have lives at stake, missions at stake."
Add Value, Not Complexity
"Most software adds complexity," says BP's Leggate, speaking for many critics of the enterprise software business. "We're looking for software that adds unique value to our corporation."
"The complexity forces companies to invest in maintenance and integration work which seems to have no return for the business. This places the CIO in a bad position," says Unilever's Cameron. "All other parts of the business can negotiate away expenses with no ROI... It makes me not want to buy software."
Build Dialogue
Software vendors have long been criticized for a lack of strategic, consultative selling. The CIO comments seem to indicate that vendors are trying to be true business partners - but not quite there yet. "Please don't tell me you're going to solve all my problems. Vendors are continually using that pitch," says Cameron. "Ask me what my problems are."
Adds Leggate, "If you're going to set out to build good stuff, come and talk to me first," We want to work with companies at a level of strategy, not at a level of selling boxes and disks."
Be Flexible
All panelists expressed an interest in new vendor business and pricing models. "The ASP model was static," says Watson. Buying software as a service allows enterprises to purchase more than just an application; it can also come with an additional piece of intellectual property. "Software as a service is more flexible."
As vendors increasingly focus on service or subscription models, it is important to remember that all customers may not want the same model - or the same model every time. Adaptability is key. "We like to go to our vendors and say, 'Can you do it this way?'" says Meehan. "Most of the time, it works out."
Embrace Reality
Even at companies with large IT budgets, funds available for new initiatives are still scarce. Meehan explains Lockheed Martin has grown 13 percent over the past 10 years but the IT budget has only grown 1 to 1.5 percent.
BP has a similar situation. "The headroom for new software is only $10, $20, $30 million a year," says Leggate of BP's budget. "We care deeply about innovation. But we need things that fit our business and take our company forward but not cause integration problems."
Smooth Merger Impact
Too often, customers are bearing the brunt of industry consolidation. "I don't know how many times I've been negotiating for a product, purchase one and then end up with the other because of an acquisition. You think you know what you're buying but then you have to factor in what's going to change as a result of the acquisition," says Meehan. "We look for value, ease of use, ease of dealing with company and flexibility in our deals. The consolidation going on in the industry adds another layer of complexity."
Enhance Security
IT security remains a tremendous challenge for enterprises. Software vendors need to do more to help fight the battle. "Today I am spending tremendous amounts of money to protect the business environment," says Meehan. Lockheed Martin tracked 56,000 viruses two years ago. Last year that figure hit 10 million. The ramifications of the situation are huge. "How can we get 130,000 people patched against a vulnerability before the hacker community figures out how to exploit it?"
Share Responsibility
"I'm looking for [vendors] to have some skin in the game," says Watson. "When it works, I'm happy to pay you because I like 'win-wins.'" But too often when it doesn't work, vendors wrap themselves in warranty provisions and eliminate their downside. "I don't believe that is a fair exchange in value."
Speed Industry Evolution
Buyers appreciate that the software industry is maturing and evolving. But the dynamics and timing of the evolution are frustrating. "We're all looking to see the future and bring the future forward," says Cameron. "When we see the future, our biggest frustration is 'How do we get there faster?' What we've got is SOA and I won't live to see it - and I'm young... So we have to get after these things faster so that we can bring them to the business and see the benefit."
"If you can [provide a solution] in 4 months for less than a million dollars, I'm ecstatic," says Meehan. "I think the technology is moving in that direction. We don't have time for the two-to-three year, multimillion dollar engagement anymore. We're expecting quick solutions to real business problems."
Maryann Jones Thompson is editor of SandHill.com. To view the entire Software 2005 CIO panel, visit the post-conference video page click here.
M&A activity by industry and SIC code, including valuation multiples and buyer activity.
Mosaic Capital - Industry Reports: "M&A activity by industry and SIC code, including valuation multiples and buyer activity."
Monday, July 11, 2005
State of the Venture Capital Industry; Analysis of Data Shows That Who You Know is Top Driver of VC Returns
PALO ALTO, Calif.--(BUSINESS WIRE)----An overview of the current state of the venture capital industry shows that some of the common perceptions about the factors that drive profit for the top firms are outdated.
Steve Bird, a general partner at leading Silicon Valley-based venture capital firm Focus Ventures today published a white paper titled "Private Equity or Personal Equity: Why Who You Know Still Drives Venture Capital Returns." Focus Ventures provides expansion-stage capital for leading software, communications and semiconductor companies.
By combining the data of industry watchers, such as VentureOne and Thomson Venture Economics, with Focus Ventures' analysis of returns from more than 8,000 venture financings from 1980-2003, the new white paper debunks, confirms, and forces caveats on some of the prevailing myths about the venture industry.
There were three major findings from Focus' research:
-- Despite the proliferation of VC firms, only 40-50 VC firms still create the bulk of industry value. The same small group of firms has consistently created the majority of value in the VC industry over the last 20 years, and their share of total industry profits has increased, not decreased, over time.
-- Stage doesn't matter... much. Perhaps the biggest myth in venture capital is that only early stage investors earn high returns. Focus Ventures found that if you take out the aberrant "bubble" year of 1999, when a substantial disparity in returns for early versus late stage skews the comparison, late-stage firms' internal rate of return (IRR) matched that of early-stage firms over the last 20 years. The report also found that, while late stage investors pay about twice as much for their equity, they also nearly double the odds of a pay-out, hold their investments half as long as early stage investors and enjoy more predictable returns.
-- Who you know is everything. The quality of the relationships that general partners build over years in the business influences VC fund returns the most, more so than sector, stage and geography. High returns and long-standing relationships with the financial community, entrepreneurs, customers, suppliers and scientists earn a firm access to the best deals, and ultimately to better performance.
"Together, these findings reinforce a notion that is intuitive, but bears repeating: that it is the quality of the startups that drives VC returns," said Bird. "And since only a handful of firms and general partners get to invest in the best startups, success in venture capital still boils down to one thing: relationships."
The findings show that only a handful of initial public offerings (usually 30 or fewer) account for the bulk (70%) of industry profits in most years. The grip of the top 50 or so venture capital firms that have invested in those IPOs is tightening, not loosening.
That research presents a quandary for limited partners: if they can't directly access the best deals through top-tier early-stage funds, should they go to other avenues such as seed and angel investments (highly risky), late-stage funds (the best of which invest later in the life of the highest quality startups), or even funds of funds to get into the most desirable investments?
"If none of these options are possible, or palatable, limited partners should avoid compromise," said Bird. "History has shown that, unless you can capture a piece of the very best deals in venture capital, your money may be better off in the public markets," Bird concluded.
To view a copy of Focus Ventures' white paper, go to: www.focusventures.com/whitepaper_who_you_know
About Focus Ventures
Focus Ventures is the leading expansion stage venture capital firm that invests in emerging market leaders in the software, semiconductor and communications industries. Focus Ventures currently manages $570 million, having closed its first fund in October 1997 and Focus Ventures II in December 1999. Focus Ventures offers its portfolio companies access to high quality partners in Asia and an extensive network of resources focused specifically on driving top line revenue growth through customer introductions and by establishing distribution channels, joint ventures and licensing arrangements. Since the firm's inception, Focus Ventures has invested in 83 companies and has had 20 IPOs and seven acquisitions by public companies. A select number of portfolio companies that have gone public include: Active Software, Agile Software, Alteon WebSystems, BroadBase Software, Chordiant Software, Commerce One, Copper Mountain Networks, Corio, CoSine Communications, Interwoven, Loudcloud, Niku, Pixelworks, and Verisity. For more information on Focus Ventures or to read Steve Bird's full white paper, visit www.focusventures.com.
The Blueshirt Group for Focus Ventures Jenny Spitz, 415-217-7722 jenny@blueshirtgroup.com
07/11/2005 10:00 ET
Steve Bird, a general partner at leading Silicon Valley-based venture capital firm Focus Ventures today published a white paper titled "Private Equity or Personal Equity: Why Who You Know Still Drives Venture Capital Returns." Focus Ventures provides expansion-stage capital for leading software, communications and semiconductor companies.
By combining the data of industry watchers, such as VentureOne and Thomson Venture Economics, with Focus Ventures' analysis of returns from more than 8,000 venture financings from 1980-2003, the new white paper debunks, confirms, and forces caveats on some of the prevailing myths about the venture industry.
There were three major findings from Focus' research:
-- Despite the proliferation of VC firms, only 40-50 VC firms still create the bulk of industry value. The same small group of firms has consistently created the majority of value in the VC industry over the last 20 years, and their share of total industry profits has increased, not decreased, over time.
-- Stage doesn't matter... much. Perhaps the biggest myth in venture capital is that only early stage investors earn high returns. Focus Ventures found that if you take out the aberrant "bubble" year of 1999, when a substantial disparity in returns for early versus late stage skews the comparison, late-stage firms' internal rate of return (IRR) matched that of early-stage firms over the last 20 years. The report also found that, while late stage investors pay about twice as much for their equity, they also nearly double the odds of a pay-out, hold their investments half as long as early stage investors and enjoy more predictable returns.
-- Who you know is everything. The quality of the relationships that general partners build over years in the business influences VC fund returns the most, more so than sector, stage and geography. High returns and long-standing relationships with the financial community, entrepreneurs, customers, suppliers and scientists earn a firm access to the best deals, and ultimately to better performance.
"Together, these findings reinforce a notion that is intuitive, but bears repeating: that it is the quality of the startups that drives VC returns," said Bird. "And since only a handful of firms and general partners get to invest in the best startups, success in venture capital still boils down to one thing: relationships."
The findings show that only a handful of initial public offerings (usually 30 or fewer) account for the bulk (70%) of industry profits in most years. The grip of the top 50 or so venture capital firms that have invested in those IPOs is tightening, not loosening.
That research presents a quandary for limited partners: if they can't directly access the best deals through top-tier early-stage funds, should they go to other avenues such as seed and angel investments (highly risky), late-stage funds (the best of which invest later in the life of the highest quality startups), or even funds of funds to get into the most desirable investments?
"If none of these options are possible, or palatable, limited partners should avoid compromise," said Bird. "History has shown that, unless you can capture a piece of the very best deals in venture capital, your money may be better off in the public markets," Bird concluded.
To view a copy of Focus Ventures' white paper, go to: www.focusventures.com/whitepaper_who_you_know
About Focus Ventures
Focus Ventures is the leading expansion stage venture capital firm that invests in emerging market leaders in the software, semiconductor and communications industries. Focus Ventures currently manages $570 million, having closed its first fund in October 1997 and Focus Ventures II in December 1999. Focus Ventures offers its portfolio companies access to high quality partners in Asia and an extensive network of resources focused specifically on driving top line revenue growth through customer introductions and by establishing distribution channels, joint ventures and licensing arrangements. Since the firm's inception, Focus Ventures has invested in 83 companies and has had 20 IPOs and seven acquisitions by public companies. A select number of portfolio companies that have gone public include: Active Software, Agile Software, Alteon WebSystems, BroadBase Software, Chordiant Software, Commerce One, Copper Mountain Networks, Corio, CoSine Communications, Interwoven, Loudcloud, Niku, Pixelworks, and Verisity. For more information on Focus Ventures or to read Steve Bird's full white paper, visit www.focusventures.com.
The Blueshirt Group for Focus Ventures Jenny Spitz, 415-217-7722 jenny@blueshirtgroup.com
07/11/2005 10:00 ET
Tuesday, July 05, 2005
Friday, July 01, 2005
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