Government Contractor SummitMarch 17, 2011

Greg Myers, General Manager – Civilian Government & HealthcareKent Cunningham, Architect, Public Sector Innovation Unit

Thank you…

90% of Microsoft’s revenue goes through partners

Partners earn $7 for every $1 of Microsoft products sold

Microsoft Partner Ecosystem

• More than 640,000 organizations in Microsoft Partner Ecosystem• More than 390,000 organizations enrolled in the Microsoft Partner

Network

Total US Government Distinct Partners : 12,408

• 1,940 Public Sector partners in the MD, DC, VA area

Microsoft is committed to delivering the tools and resources partner need deliver critical customer solutions

Takeaways for Today

New Insights into Working With Microsoft

Better Snapshot of Key Areas of Focus for Gov Customers

Review of Where Microsoft is Making Big Bets in Innovation & Our Cloud Offerings

Ideas for How Your Company Can Drive New Revenue Opportunities

Snapshot of the Microsoft USPS Organization

4 Major Divisions (Federal, State/Local, Education, Health)

Includes Sales, Technical, Marketing, Biz Dev/Capture ResourcesFederal is Civilian/Health; National Security; DOD; Systems IntegratorsAverage Tenure in Some Divisions 7+ Years

Over 700 Dedicated Employees; $3B OperationLargest Dedicated Vertical in Microsoft Partner Organization Embedded in Each Division

Talking to Microsoft…

sassssssssss

Government Directives: Citizen Services; Cybersecurity; Transparency; Consolidation & Virtualization

Solutions: BI; Dashboards; UC/Collab; Grants/Task/Correspondence Management; FOIA; 311; AFDC; Identity Management

Enterprise Agreements: Drive ValueIncremental Value through SolutionsDeploy: New Products & Upgrades

Build New MarketsConnected Healthcare,

Cloud, Gov 2.0, Financial & Regulatory Solutions

Address Whitespace

Dynamics; SQL: Security; ECAL,

Systems Mgmt.; Azure; Development

DeployDriving the Value of

Office & Win 7

Sales Teams goals: Customer satisfaction, Net New Product growth, EA renewalsJoint Value Proposition: Net New Customer Value, Customer Relationships, Repeatable Solutions, Vehicles, Ambassadorship, SME

What We Hear from Our Customers

Software is the great enabler!

Balance Needs of a Changing GovernmentThe dual challenges of IT in today’s governmental agencies

Implement economic recovery programs.Modernize government processes.Deliver services directly to citizens.Create more jobs, and encourage and enable environmental sustainability.

Broaden access to technology.Consolidate redundant investments.Facilitate transparency, accountability.Help ensure interoperation with LOB systems.Deliver IT innovation.

Support political andbusiness objectives

Maximize impact of IT investmentswith reduced budgets

New Communication MediumsAmerica Speaking Out

Recovery.gov

Treasury.gov

Compliance Trends and MandatesMacro Trends Mandates & Drivers

• Everything from Funding to Project Visibility to Acquisition IT Reform

Transparency

Telework

Regulation

Cloud Computing

• Open Government Directive = CIOs expect 10% of IT budget to be dedicated to transparency• Critical to address Cybersecurity

• Telework Act 2010 = IT orgs increase IT capacity by 30% to meet anywhere• Access requirements so that federal employees can telework 20% of the time.

Data Center Consolidation

Innovation • The President is proposing a 3% budget increase in new innovation investmentsIn science, research, green tech, security, transportation, and education

• Dodd/Frank Act - strengthens oversight of federal regulators with new financial policies which will require new G2B (banks) and G2C (consumer) solutions

• Target of 1300 (from 2100) datacenters by 2015 and movement to Greener Technology Platforms

• ‘Cloud First’ Mandate is at Center of OMB’s Directive for New Implementations; 25% Target Established for all IT Spending

Translate Business Challenges into Technology SolutionsTogether, We Can Have a Major Impact

Modernize Government IT

Increase Government Worker Productivity

Improve Citizen Interaction

Use hardware-based encryption to help protect data saved on USBs and servers.

 DirectAccess securely connects you to internal networks with just an Internet connection.

Improve Security and Data Protection

Manage virtual environments with the same management tools, processes, and procedures used for managing physical environments.

Improve Virtual Management

Sleep/Power management saves >1,000 tons of greenhouse emissions annually for every 10,000 PCs.

Virtualized servers reduce operational expenses around server heat, electricity usage, space, and maintenance.

Reduce the number of machines without sacrificing performance.

Achieveenvironmental stewardship

Modernize Government ITAsset Consolidation and Management

Use virtualization to help you use existing hardware investments more efficiently.

Server virtualization means less money spent on hardware and power, and greater efficiencies in business continuity.

Reduce Costs

Grant IWs easy access to LOB and non-LOB sources. Automate and secure workflow, and create checks and balances.Workflow

Increase energy savings through improved telework and collaboration capabilities.

Reduce physical and carbon-intensive processes through streamlined workflow and communications.

Offer distance eLearning. Support telework to reduce government worker commuting.

Environmental Stewardship

Increase Government Worker ProductivityCollaboration, Workflow, and Telework

Leverage SharePoint® Server, document repositories, and portal sites to facilitate information connectivity.

Maximize resources with increased flexibility using UC Solutions. Provide an adaptable foundation that integrates existing messaging

and voice infrastructure.

Collaboration

Spending Trends

FY2009

Maintenance

Discretionary 22%

FY 2012 Predicted

Maintenance

Discretionary 25.5%

PBR 2/14/11

5 year freeze on non

Maintenance spend

Innovation Spending to increase 3%

Why All the Fuss About the Cloud?

“The bottom line: Early adopters are finding serious benefits, meaning that cloud computing is real and warrants your scrutiny as a new set of platforms for business applications.”

“By 2012, 80% of Fortune 1000 enterprises will be

using some cloud computing services, 20% of

businesses will own no IT assets.”

Pay for what you use

Lower and predictable costs

Shift from capex to opex

Accelerate speed to value

No patching or maintenance

Faster deployment

Robust multi-layered security

Reliability and fault-tolerance

Latest software for users

Internet collaboration

New apps and services

New Economics Simplicity Agility and Innovation

Public Sector Cloud MomentumUS Department of Agriculture moving to Microsoft BPOS Federal

Cloud services in 49 of 50 states with over 3M government employees utilizing Microsoft Online ServicesState of California uses Microsoft BPOS to host state-wide email and productivity applications consolidating hundreds of disparate systems and datacenters reducing operational costs City of New York moving 30,000 NYC workers across 100 agencies to Microsoft cloud saving millions

Kentucky Dept of Education moves 700K15M people using Live@edu around the world in more than 10,000 schools

World’s largest partner ecosystem for the cloud, with 16,000 Microsoft partners 

Recommendations

Get As Educated As Possible on Key Documents e.g. Cloud Computing Strategy, 25 Pt Plan, Budget Align Solutions That Will Take Costs Out and Exploit OpExEfficiency, Agility, Innovation

Leverage ‘the MSFT Stack’ and Drive Its AdvantagesFind Sponsors Outside of IT and Target Quick WinsUse Your MSFT Partner Network Resources

Innovation in Public Sector

Kent CunninghamU.S. Public Sector

Designed for the way people and

organizations work

Power of choice for deployment, partners, and devices

The industry leader in IT R&D investment driving enterprise

class solutions

Committed to your long term success

The Microsoft Vision = Value

Types of Cloud ServicesServices taxonomy

(On-Premises)

Storage

Servers

Networking

O/S

Middleware

Virtualization

Data

Applications

Runtime

You m

anag

e

Infrastructure

(as a Service)

Storage

Servers

Networking

O/S

Middleware

Virtualization

Data

Applications

Runtime

Oth

er M

an

ages

You m

anag

e

Platform

(as a Service)

Oth

er M

an

ages

You m

anag

e

Storage

Servers

Networking

O/S

Middleware

Virtualization

Applications

Runtime

Data

Software

(as a Service)

Oth

er M

an

ages

Storage

Servers

Networking

O/S

Middleware

Virtualization

Applications

Runtime

Data

Microsoft is Invested in the CloudS

aaS

• Hotmail• Messenger• Photo Gallery• WL Spaces• SkyDrive• Profile• Photos• Mesh (beta)

• Mail• Calendar• Groups• Toolbar• Family Safety• Writer• Movie Maker• LiveID

• Business Productivity Online Suite• Exchange Online• SharePoint Online• Office Communications Online• Office Live Meeting

• Exchange Hosted Services• Dynamics CRM Online• System Center Online

Desktop Manager

Online companions to:• Word• Excel• PowerPoint• OneNote

• Registration & Search• Companies• Applications• Professional Services

• Outlook Live• Live@edu

• Search• Maps

• VXML Platform• Speech Recognition 3rd Party Cloud Services

Dynamic Data Center ToolkitFor Hosters

Dynamic Infrastructure ToolkitFor System Center (Beta)

PaaS

• User Data APIs• WL Messenger SDKs• WL SDK• Microsoft Advertising APIs• Silverlight Streaming SDK• WL Admin Center SDK• WL Spaces SDK• WL Client Extensibility APIs

AppFabric• AppFabric Service

• Connectivity• Access Control

• RDBMS Service• Relational Data• Management

• Compute Service• Web Role• Worker Role

• Storage Service• Blobs• Tables• Queues

• Fabric Controller• Agent 1• Agent 2• Agent n

• Data Subscription Service• Discover, Purchase• Management

• Open Source SDK• Interactive data access• API data access 3rd Party Cloud Services

Codename “Project Sydney”

• Virtual Network Overlay

• ApplicationLifecycleManagement

“Data” is the Fuel for TransformationAzure DataMarket … http://datamarket.azure.com

Offers a single site to obtain public and private dataEasy subscription model for possible revenue recoveryIntegrated plug-ins to leverage data usage within familiar tools – like Excel 2010 with the free DataMarket Add-in

ScenariosMonetize content and services

through DataMarket

Build innovative real-time apps onWindows Azure using DataMarket

Better BI by mashing up enterprisedata with industry data

Build Mobile Apps using DataMarket

Transformational Trends

COMPUTING POWER & STORAGE

LOCATIONSENSING

SOCIALNETWORKS

CLOUDCOMPUTING

NATURAL INTERACTION

UBIQUITIOUS CONNECTIVITY

UBIQUITIOUS DISPLAYS

Location Sensing

Niagara Falls

Social Collaboration

Exchange Voice Mail Preview

Speech to Text Intelligence

OneNote 2010

Windows Speech RecognitionNatural User Interfaces

Microsoft Research Audio Video Indexing System (MAVIS)

Automotive

HealthcareMovies

Financial Services and Banking

Search

Travel

Speech leader in mobile, cloud, pc, gaming, and auto.

Shipping

800-GoFedEx800-PICK-UPS

800-882-8880

888-656-4546

800-872-8528

800-bing-411Wireless 411800-555-1212Wireline 411

Pizza Ordering

800-DOMINOS

800-FIDELITY800-528-4800800-ETRADE-1

800-FANDANGO

800-637-7455

888-267-3515800-377-9220

The Promise of Kinect

An extraordinary new way to play, where you are the controller

Voice Recognition

Face Recognition

You Recognition

Motion Recognition

“What really matters is that Microsoft has now publicly embraced the (open source Kinect developments) — and that's an instance of a broad and profound change in corporate innovation.”

“Contributing new capabilities to the technium, then standing back to see what new applications might arise from combining their developments with the imagination of a network of innovators”

Lessons from Kinect

WPF Motion Tracking

• Partner Derived Solutions for USPS Customer

• Uses Speech, Gesture, and Motion• Controls using WPF, Bing Maps, SharePoint BI, and Kinect

Q: Now how do you truly measure innovation ?

Patents ? Analysts ? “Buzz” ? Revenue??

If Your Yardstick Is Industry RecognitionMicrosoft Gartner Leader Quadrants 2000-Present

2000 2004 20100

2

4

6

8

10

12

14

16

18

20

BIInfrastructureSOAApplication PlatformCollaborationCommunication

IBM:11

Oracle/SUN: 10

Salesforce.com: 2

Google: 1

VMware: 1

Let’s just get it out of the way:Windows Phone 7 is the most excitingthing to happen to phones in a long time…

Note to Apple and Google: You really do have some competition now.

Microsoft will also seduce customerswith the slick and clean design ofthe Windows Phone 7 interface.

Windows is a platform that cannot be ignored. This is a very fresh take.

10 Million

Kinect Sensors sold

in 60 days

300 Million

Windows 7 PCs, PC shipment

forecast for 2011 is 409 million

Market Adoption

Office 2010 Fastest-selling version of Office in history, 50% ahead of Office 2007

20 MillionInternet Explorer 9 Beta Downloads

100/dayNew Windows Phone 7

Applications

355 Million

Active Hotmail &

Windows Live Users

22 MillionNew Search customers on Bing in past 12 months

It’s tempting to look for a magic formula for innovation

There is no perfect formula…but there are vital ingredients

THE MICROSOFT APPROACH TO INNOVATION

A long term

approach

Embracing disruptions

A focus on scale

Hiring the best people

A balance of

invention,

re-invention &

evolution

A commitment

to openness &

partnerships

Microsoft Public Sector Demo Network

www.microsoftpsdemos.com

“The best way to predict the future is to invent it.”

- Alan Kay

Thank you