softlayer presentation at stifel nicolaus event feb 10 2011 vfinal

CONFIDENTIAL INFORMATION • SOFTLAYER TECHNOLOGIES

Stifel Nicolaus: Technology, Communications and Internet Conference 2011

02 10 11

CONFIDENTIAL INFORMATION • SOFTLAYER TECHNOLOGIES 2 Stifel Nicolaus: Technology, Communications and Internet Conference 2011

SoftLayer® Facts §  $280 million in revenue for 2010 §  $105 million in EBITDA for 2010

§  550+ employees §  Mainly in Dallas and Houston

§  Dallas §  Seattle §  Washington DC §  Houston §  San Jose (Q1-11) §  Amsterdam (Q4-11)

Customers §  More than 24,000 customers in over 110 countries §  More than 76,000 deployed servers §  More than 7.9 million domains hosted (#2 worldwide)

Financial

Employees

Corporate Headquarters

§  Dallas, TX §  60,000 square feet of office space §  Accounting, Sales, Development, Corporate

Financial

Employees

Data Centers


SoftLayer Target Markets

Internet-centric SMBs (79% of revenue)

Channel partners (21% of revenue) §  Businesses that use SoftLayer’s platform to

provide customized services on an “asset light” basis to a diverse customer base

§  Extremely low customer churn §  Provide sizeable orders to SoftLayer §  ~6,000 end-customers across 4+ million

domain names

§  Businesses that are benefiting directly

from trends of mobile and streaming media, remote application hosting, and social networking §  Web 2.0 §  SaaS §  Social gaming

§  Provide high organic growth and a steady source of new customers

§  Large market ($1.4bn domestically) growing rapidly (20%+)

§  Internet retail

§  iPhone developers

SoftLayer target customers are components of attractive, high growth markets

21%

79%


A Broad Group of Dynamic Customers


SoftLayer is an IT Production Facility Internet-centric businesses and SoftLayer channel partners utilize SoftLayer as their “manufacturing plant” to produce the services they deliver to their

customers

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SoftLayer® Value Statement

Innovation We lead the industry, bringing solutions to market before others realize the need for them.

Empowerment We push complete control to the end user to create the virtual data center experience.

Integration We bring together hardware, software, security, networking, and storage in a single easy to use on-demand service.

SoftLayer Delivers World Class, On-demand Virtual Data Center Services.

Automation We automate every single facet of the data center environment to bring efficiency and standardization.


What we provide Dedicated Servers §  Single, dual, and quad proc multi-core systems §  Specialty redundant power, mass storage, and private network configs

CloudLayer™ Services §  Computing (Public, Private, Bare Metal, and Build Your Own Cloud), Storage, and CDN

Industry-Leading Customer Portal and Open API §  Direct access to more than 150 backend systems and activities, executed without any

human intermediation. Integrated Geographically Diverse Data Centers §  Three data centers connected via private, 10G point-to-point connections, and

integrated through proprietary automated tools. §  Advanced data center pod design targeting maximum efficiencies High Speed Network with Proprietary, Highly-Secure Architecture §  Server-to-server communication, out-of-band management, and unlimited data transfer

via VPN over dedicated carriers segregated from our Public Network. §  Nationwide Network Points of Presence for more direct connections


Substantial IP in the business has driven:

Customer Value Proposition §  Total control over configuration and provisioning §  Ability to add servers on-demand as customer platform scales §  Over 1600 proprietary APIs allow end-users a high degree of software

and hardware flexibility and customization §  Private network

Operating efficiency §  Automated systems + standardization keep incremental operating costs

low, driving unit-level profitability and industry-leading EBITDA margins

Scalability §  Ability to add incremental servers and scale up quickly and efficiently with

few people

Capital efficiency §  Just-in-time servers; capex tightly linked to growth

Competitive differentiation §  Customer benefits and efficiencies provide competitive advantage in the

marketplace

Proprietary Technology Platform


Hybrid Environments from a Common Core The Physical Server is the Fundamental Building Block to All Technologies

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Fully Integrated Computing Environment SoftLayer Provides the Only Completely Integrated Solution in the Industry Dedicated servers, virtualized environments, and cloud solutions all operate together seamlessly to create an on-demand solution that can be scaled in real-time to best meet business needs. Regardless of the solution, (standalone, or hybrid) delivery is managed via the same user interface, using the same APIs and is billed on a single bill.


CloudLayer™ Service Offerings

CDN

Storage

Computing

§ Computing instances in “minutes” (5-15) § Open source and enterprise OS selections w/ control

panels § Monthly or hourly billing methods §  Automated recovery in the event of hardware failure § Usage based or packages starting at $.15/hr or $50/mo

§ Origin Pull or Point of Presence (PoP) Pull § Usage based or packages starting as low as $.12/GB §  Sold with servers or as stand alone service

§  Access from server, desktop, web, portal, API, and PDA § Native apps for iPhone, Blackberry, Windows, Android § Usage based or packages starting as low as $0.25/GB §  Sold with servers or as a stand alone service

CloudLayer is the Umbrella Brand for the Next Generation of Services That Can Be Sold With our Without a Dedicated Server.


With a Managed Solutions Wrapper Our Managed Hosting service is industry leading because of the flexibility and accuracy that our automated infrastructure provides. Automation allows us to offer advantages that others cannot, including:

•  One Day Provisioning •  Monthly Contracts with Unparalleled Pricing •  Hybrid Managed + Self Managed + Cloud Solutions •  Real-Time Reporting

For our customers, all of this equals higher scalability, stability, and performance and cost effectiveness.


Data Center and Network Locations

Note: San Jose, CA is in final lease negotiations and is expected to open in Q4 2010


Continued Innovation §  Extensive product and feature roadmap

§  Enhancement of current features and services

Continued Growth § Data center and network expansion

§ Grow customer base

§ Grow geographically, including internationally

True Virtual Data Center Services

§  Innovative infrastructure, solutions

§  Automation of all aspects of operations

§  Integration with 3rd party management tools

§  Extend management to colocation environments

SoftLayer Summary

Hybrid Environment § Continue to enhance and develop our leading hybrid computing environment


Contact Information §  George Karidis, Chief Strategy Officer [email protected]

Direct number: 214-442-0625

§  Mark Quigley, Director Corporate Communications [email protected]

Direct Number: 214-442-1842

softlayer presentation at stifel nicolaus event feb 10 2011 vfinal

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