Oracle Corporation et al v. SAP AG et al

Filing 657

Declaration of Zachary J. Alinder in Support of 649 MOTION for Partial Summary Judgment filed byOracle International Corporation, Oracle USA Inc.. (Attachments: # 1 Exhibit 1, # 2 Exhibit 2, # 3 Exhibit 3, # 4 Exhibit 4, # 5 Exhibit 5, # 6 Exhibit 6, # 7 Exhibit 7, # 8 Exhibit 8, # 9 Exhibit 9, # 10 Exhibit 10, # 11 Exhibit 11, # 12 Exhibit 12, # 13 Exhibit 13, # 14 Exhibit 14, # 15 Exhibit 15, # 16 Exhibit 16, # 17 Exhibit 17, # 18 Exhibit 18, # 19 Exhibit 19, # 20 Exhibit 20, # 21 Exhibit 21, # 22 Exhibit 22, # 23 Exhibit 23, # 24 Exhibit 24, # 25 Exhibit 25, # 26 Exhibit 26, # 27 Exhibit 27, # 28 Exhibit 28, # 29 Exhibit 29, # 30 Exhibit 30, # 31 Exhibit 31, # 32 Exhibit 32, # 33 Exhibit 33, # 34 Exhibit 34, # 35 Exhibit 35, # 36 Exhibit 36, # 37 Exhibit 37, # 38 Exhibit 38, # 39 Exhibit 39, # 40 Exhibit 40, # 41 Exhibit 41, # 42 Exhibit 42, # 43 Exhibit 43, # 44 Exhibit 44, # 45 Exhibit 45, # 46 Exhibit 46, # 47 Exhibit 47, # 48 Exhibit 48, # 49 Exhibit 49, # 50 Exhibit 50, # 51 Exhibit 51, # 52 Exhibit 52, # 53 Exhibit 53, # 54 Exhibit 54 - 1, # 55 Exhibit 54 - 2, # 56 Exhibit 55, # 57 Exhibit 56, # 58 Exhibit 57, # 59 Exhibit 58, # 60 Exhibit 59, # 61 Exhibit 60, # 62 Exhibit 61, # 63 Exhibit 62, # 64 Exhibit 63, # 65 Exhibit 64, # 66 Exhibit 65, # 67 Exhibit 66, # 68 Exhibit 67, # 69 Exhibit 68, # 70 Exhibit 69, # 71 Exhibit 70, # 72 Exhibit 71, # 73 Exhibit 72, # 74 Exhibit 73, # 75 Exhibit 74, # 76 Exhibit 75, # 77 Exhibit 76, # 78 Exhibit 77, # 79 Exhibit 78, # 80 Exhibit 79, # 81 Exhibit 80, # 82 Exhibit 81, # 83 Exhibit 82, # 84 Exhibit 83, # 85 Exhibit 84, # 86 Exhibit 85, # 87 Exhibit 86, # 88 Exhibit 87, # 89 Exhibit 88, # 90 Exhibit 89, # 91 Exhibit 90, # 92 Exhibit 91, # 93 Exhibit 92, # 94 Exhibit 93, # 95 Exhibit 94, # 96 Exhibit 95, # 97 Exhibit 96, # 98 Exhibit 97, # 99 Exhibit 98, # 100 Exhibit 99, # 101 Exhibit 100, # 102 Exhibit 101, # 103 Exhibit 102, # 104 Exhibit 103, # 105 Exhibit 104, # 106 Exhibit 105, # 107 Exhibit 106, # 108 Exhibit 107, # 109 Exhibit 108, # 110 Exhibit 109, # 111 Exhibit 110, # 112 Exhibit 111, # 113 Exhibit 112, # 114 Exhibit 113, # 115 Exhibit 114, # 116 Exhibit 115, # 117 Exhibit 116, # 118 Exhibit 117)(Related document(s) 649 ) (Howard, Geoffrey) (Filed on 3/3/2010)

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Oracle Corporation et al v. SAP AG et al Doc. 657 Att. 60 Case4:07-cv-01658-PJH Document657-61 Filed03/03/10 Page1 of 11 EXHIBIT 60 Dockets.Justia.com Case4:07-cv-01658-PJH Document657-61 Filed03/03/10 Page2 of 11 Ex 60 - Page 1 Case4:07-cv-01658-PJH Document657-61 Filed03/03/10 Page3 of 11 Business Case TomorrowNow 2006 Board Area: Gerd Oswald Status: November 16, 2005 Ex 60 - Page 2 SAP-OR00136760 Case4:07-cv-01658-PJH Document657-61 Filed03/03/10 Page4 of 11 Open Issue Budget Case TNow Within Baseline Budget 2005, TNow committed EUR 15,3 Mill.1 external Revenue planned within GSS (including TNow Stand-Alone as well as SafePassage deals), although SafePassage Revenue is generated in CSO. Based on pipeline 2006 (provided by Andy Nelson), TNow can realize EUR 24,1 Mill. external Revenue in 2006 (Final Budget incl. add. investments of 9,6 M would have a profit margin of 15%) Weighted Pipeline (16.11.2005) Stand-Alone deals: EUR 16 Mill. Safe Passage: EUR 7,6 Mill. Main problem is the missing Budget commitment of CSO for SafePassage Revenue in 2006 (EUR 8,1 Mill.4) Only if CSO would put the missing SafePassage Revenue on top of Budget 2006, TNow would be considered as revenue generating Budget Case and not as a pure Investment Case by Corp. Co. HL2 BUD 2006 (Baseline) TNow Stand-Alone (booked within GSS) H All Values in kEUR FC 2005 ' L2 BUD / FC05 11.685 -7.200 Budget Business Case TNow 2006 Final Provided to Open Commit. Budget Corp. Co by CSO Case 760 8.051 760 -8.918 -9.624 -8.864 8.051 8.051 760 Final Budget 2006 (incl. Safe Passage Rev.) F ' inal BUD / FC 05 12.445 851 3.585 7.200 10.785 -9.291 -10.081 704 15.270 16.030 8.051 24.081 -19.452 -20.517 3.564 Safe Passage (booked within CSO) 4 8.051 8.811 -8.918 -9.624 -813 External Revenue Local Expenses Total Expenses 15.270 -10.534 -10.893 4.377 1 4.485 -1.243 -812 3.673 2 13.296 -10.161 -10.436 2.860 Operating Income Profit Margin in % Headcount (in FTE) 7 102 29 105 3 -1.166 123 -9 123 15 228 126 SAP AG 2005, Thomas Ziemen, Service Solution Management Ex 60 - Page 3 SAP-OR00136761 Case4:07-cv-01658-PJH Document657-61 Filed03/03/10 Page5 of 11 Case4:07-cv-01658-PJH Document657-61 Filed03/03/10 Page6 of 11 Business Outlook Safe Passage Pipeline (bundled deals) 10 30 14 11 Booked TomorrowNow Pipeline (stand-alone deals) 12 7 2 2 Booked 92 Won In Process 108 113 Won 2005 166 2006 145 Dis continued L os t 2005 2006 In Process Dis continued L os t In Total: 298 In Total: 161 Weighted Pipeline Q4 2005 / 2006: In Total: 240 281 In Total: 285 Weighted Pipeline Q4 2005 / 2006: 394 Opport. * 58% Win Rate * 70K Avg. Deal Size = 16.0M 311 Opport. * 18% Win Rate * 138K Avg. Deal Size = 7.6M 2005/2006 Opportunities by Phase: A/B 17%, C/D 44%, E/F 39% Financial View 2006 (in Mn) Q1 TNow stand alone deals Bundled deals* External Revenue Total Expenses Margin FTE Total NA Total LAM Total EMEA Total APA Total 140 80 5 27 28 172 85 8 40 39 200 90 10 50 50 224 99 13 56 56 3.9 1.4 5.3 -4.0 Q2 4.0 1.7 5.7 -4.7 Q3 4.0 2.0 6.0 -5.3 Q4 4.1 2.5 6.6 -6.0 16.0 7.6 23.6 -20.0 15% 224 99 13 56 56 Financial View 2007 (in Mn) Q1 TNow stand alone deals Bundled deals* External Revenue Total Expenses Margin FTE Total NA Total LAM Total EMEA Total APA Total 249 104 15 58 72 266 105 18 67 76 277 107 22 67 81 300 112 24 71 93 5.8 2.9 8.7 -8.3 Q2 7.1 3.5 10.6 -8.7 Q3 8.8 4.3 13.1 -8.9 Q4 9.9 5.1 15.0 -9.4 31.6 15.8 47.4 -35.3 25% 300 112 24 71 93 * Additional budget revenue booked within CSO: Adjustment on bundled deals that were not posted as external revenue in TomorrowNow (but charged internally) SAP AG 2005, Thomas Ziemen, Service Solution Management Ex 60 - Page 5 SAP-OR00136763 Case4:07-cv-01658-PJH Document657-61 Filed03/03/10 Page7 of 11 BC TomorrowNow 2006: Executive Summary, Reason Budget Request 2006 Headcount +123 FTE Investments +9,6 M Ext. Revenue +8,8 M Profit Margin of Request -9% Profit Margin of Final Budget 15% Review 2005 and Base of Operations for 2006: K ey Achievements 2005: Expected growth of TomorrowNow installed base up to approx. 160 customer contracts (started with 68 at beginning of 2005) Expected Maintenance contract volume of approx. 11.5M (doubles to 23M Maintenance contract volume taken away from Oracle). This order entry has to be supplied in 2006 First steps taken to establish TomorrowNow globally according to Business Opportunity (EMEA: UK, NL and APA: Singapore in addition to the existing seven US locations; foundation of TNow subsidiary in Australia in preparation) As a result of the acquisition of PeopleSoft by Oracle, SAP launched the Safe Passage Program for customers also running PSFT and JDE to offer a way out of the uncertainties arisen by this acquisition and has extended it for Siebel customers after the pending acquisition by Oracle The Maintenance offering a key part of the Safe Passage Program and provided by TomorrowNow is used as enabler for future license revenue, to grow maintenance contract volume taken away from Oracle and to generate additional maintenance revenue for SAP PSFT's / JDE's customer base consists of 12,500 customers, approx. 2,000 joint SAP/PSFT customers, Siebel's customer base consists of 4,000 customers including a large number of joint SAP/Siebel customers, which build SAP's market opportunity Student Administration (PSFT) and Customer Relationship Management (Siebel) identified as two new Business opportunities Growth opportunity reinforced by newly announced "Oracle Lifetime Support" with significant uplift of Maintenance fees Motivation for and description of business case (BC): In order to continue the successful establishment of TomorrowNow according to strong expected growth of the Off-Oracle Maintenance Business, the additional Cost Budget ( 9,6M) and FTEs (123) for 2006 have to be approved If Budget Request will be approved TNow shows a 15% profit margin in Budget 2006 (24,1M external revenue; 20,5M Total expenses) Expected revenue growth till 2008 25 15 23.6 2006 47.4 2007 32 61.1 Revenue (in M) Profitability (in %) 2008 Revenue more than doubles in 2006; improve profitability up to 25%, considering initial investments for Siebel maintenance business SAP AG 2005, Thomas Ziemen, Service Solution Management Ex 60 - Page 6 SAP-OR00136764 Case4:07-cv-01658-PJH Document657-61 Filed03/03/10 Page8 of 11 BC TomorrowNow 2006: Executive Summary, Impact How does this BC support SAP's strategy and Board area strategy? Safe harbor for PeopleSoft, JD Edwards and Siebel customers Leverage service as competitive weapon in order to restrict competition Support SAP's strategy to grow and secure Maintenance revenue Strengthen global market position and increase global market share Market Potential of TomorrowNow 160 TNow new customer contracts and renewals expected for 2005 400 TNow new customer contracts and renewals expected for 2006 Appr. 400 TNow stand-alone opportunities after Oracle announcement of Lifetime Support Strategy with significant uplift of Maintenance fees for PSFT and Siebel customers Appr. 300 bundled Safe Passage opportunities (status September 2005) Expected maintenance revenue taken away from Oracle for 2005: approx. 23M Expected maintenance revenue taken away from Oracle for 2006: approx. 66M Bundled Safe Passage Opportunities 10 30 14 11 TNow Stand-Alone Opportunities 12 7 2 2 In Total: 161 Booked Won In Process In Total: 285 Booked 92 108 113 Won 2005 166 2006 145 Dis continued Los t 2005 2006 In Process Dis continued L os t In Total: 298 311 Opport. * 18% Win Rate * 138K Avg. Deal Size = 7.6M In Total: 240 281 394 Opport. * 58% Win Rate * 70K Avg. Deal Size = 16.0M SAP AG 2005, Thomas Ziemen, Service Solution Management Ex 60 - Page 7 SAP-OR00136765 Case4:07-cv-01658-PJH Document657-61 Filed03/03/10 Page9 of 11 BC TomorrowNow 2006: Executive Summary, Impact Committed Revenues by Region/by Product (incremental) No breakdown per region Development/Field Resource Impact (if approved by FLT)(incremental) No Development / Field Resource Impact Other none Impact of "Doing Nothing" Miss the unique increased opportunity to take away Maintenance revenue from Oracle, reinforced by the newly announced "Oracle Lifetime Support Program", and to encounter Oracle's new Maintenance strategy Other software vendors might provide a safe harbor initiative and win advantage over SAP SAP to lose potential maintenance and license revenue as well as customers SAP AG 2005, Thomas Ziemen, Service Solution Management Ex 60 - Page 8 SAP-OR00136766 Case4:07-cv-01658-PJH Document657-61 Filed03/03/10 Page10 of 11 BC TomorrowNow 2006: Incremental P&L overview for 2006 Business Case/ Budget transfer TNow Budget PAC all figures in thousand EURO Maintenance Revenue Product Revenue Consulting Revenue Service Revenue EXTERNAL REVENUE 3rd Party Services Personnel Expenses Travel/Entertainment Marketing Infrastructure Other Inc./Exp., net Local EXPENSES Internal Charges for Bundled Deals, net Building / IT TOTAL EXPENSES OPERATING INCOME Margin HLD number HLD BA GO HL 2 Baseline 15.270,0 15.270,0 0,0 1 5 . 2 7 0 ,0 -778,0 -8.368,0 -333,0 -176,0 -880,0 - 1 0 . 5 3 5 ,0 -470,0 112,0 -10.893,0 4 . 3 7 7 ,0 MPU Controller Joerg Josenhans MPU 257000301 MP U Currency EUR FC 2005 3.500,0 3.500,0 41,0 41,0 3 . 5 4 1 ,0 -1.132,0 -6.036,0 -480,0 -804,0 -724,0 -11,0 - 9 . 1 8 7 ,0 -400,0 -807,0 -10.394,0 - 6 . 8 5 3 ,0 Additional Budget Request 2006 Q1 142,0 142,0 0,0 1 4 2 ,0 -80,0 -694,0 -117,0 -436,0 -122,0 - 1 . 4 4 9 ,0 1.503,0 -78,0 -24,0 1 1 8 ,0 Q2 172,0 172,0 0,0 1 7 2 ,0 -80,0 -1.226,0 -117,0 -436,0 -226,0 - 2 . 0 8 5 ,0 1.825,0 -152,0 -412,0 - 2 4 0 ,0 Q3 203,0 203,0 0,0 2 0 3 ,0 -80,0 -1.579,0 -117,0 -436,0 -274,0 - 2 . 4 8 6 ,0 2.147,0 -211,0 -550,0 - 3 4 7 ,0 Q4 243,0 243,0 0,0 2 4 3 ,0 -80,0 -1.964,0 -117,0 -436,0 -302,0 - 2 . 8 9 9 ,0 2.576,0 -265,0 -588,0 - 3 4 5 ,0 TY 2006 760,0 760,0 0,0 0,0 7 6 0 ,0 -320,0 -5.463,0 -468,0 -1.744,0 -924,0 0,0 - 8 . 9 1 9 ,0 8.051,0 -706,0 -1.574,0 - 8 1 4 ,0 Final Budget 2006 16.030,0 16.030,0 0,0 1 6 . 0 3 0 ,0 -1.098,0 -13.831,0 -801,0 -1.920,0 -1.804,0 - 1 9 . 4 5 4 ,0 7.581,0 -594,0 -12.467,0 3 . 5 6 3 ,0 15% External Rev. Addit.: 8,8 M Final: 24,1 M Total Expenses Addit.: 9,6 M Final.: 20,5 M Budget COS all figures in thousand EURO SW Revenue Maintenance Revenue Product Revenue Consulting Revenue Training Revenue Service Revenue Other Revenue EXTERNAL REVENUE Customer Support Cost of Product COS Expenses TOTAL EXPENSES OPERATING INCOME TOTAL 0,0 88.230,0 88.230,0 0,0 0,0 0,0 0,0 8 8 . 2 3 0 ,0 -54.060,9 -54.060,9 - 5 4 . 0 6 0 ,9 -54.060,9 3 4 . 1 6 9 ,1 Additional Budget Request 2006 HL2 BUD06 15.270,0 15.270,0 0,0 0,0 0,0 0,0 1 5 . 2 7 0 ,0 -10.893,0 -10.893,0 - 1 0 . 8 9 3 ,0 -10.893,0 4 . 3 7 7 ,0 Q1 0,0 142,0 142,0 0,0 0,0 0,0 0,0 1 4 2 ,0 -24,0 -24,0 - 2 4 ,0 -24,0 1 1 8 ,0 Q2 0,0 172,0 172,0 0,0 0,0 0,0 0,0 1 7 2 ,0 -412,0 -412,0 - 4 1 2 ,0 -412,0 - 2 4 0 ,0 Q3 0,0 203,0 203,0 0,0 0,0 0,0 0,0 2 0 3 ,0 -550,0 -550,0 - 5 5 0 ,0 -550,0 - 3 4 7 ,0 Q4 0,0 243,0 243,0 0,0 0,0 0,0 0,0 2 4 3 ,0 -588,0 -588,0 - 5 8 8 ,0 -588,0 - 3 4 5 ,0 TY 2006 0,0 760,0 760,0 0,0 0,0 0,0 0,0 7 6 0 ,0 -1.574,0 -1.574,0 - 1 . 5 7 4 ,0 -1.574,0 - 8 1 4 ,0 Final BUD 0,0 16.032,0 16.032,0 0,0 0,0 0,0 0,0 1 6 . 0 3 2 ,0 -12.467,0 -12.468,0 - 1 2 . 4 6 8 ,0 -12.468,0 3 . 5 6 4 ,0 Budget HC TOTAL Q1 39,0 Additional Budget Request 2006 Q2 71,0 Q3 99,0 Q4 123,0 TY 2006 83,0 Final BUD 184,0 All figures in FTE HL2 BUD06 798,5 101 Busines Support 2005, Thomas Ziemen, Service Solution Management ,0 s SAP AG Ex 60 - Page 9 SAP-OR00136767 Case4:07-cv-01658-PJH Document657-61 Filed03/03/10 Page11 of 11 BC TomorrowNow 2006: Incremental P&L overview for 2007/2008 SAP AG 2005, Thomas Ziemen, Service Solution Management Ex 60 - Page 10 SAP-OR00136768

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