The Server OpportunityThe Server Opportunity

Bob MugliaBob MugliaSenior Vice PresidentSenior Vice PresidentWindows Server DivisionWindows Server Division

AgendaAgenda

Server Operating System Server Operating System Units Shipments Units Shipments

Source: IDC Server Tracker, April 2005

18%18%

GrowthGrowth2004200420032003

$913$913$(213)$(213)IncomeIncome

$2,523$2,523$2,146$2,146Revenue Revenue

Three months ended Dec 31Three months ended Dec 31

Server And ToolsServer And Tools

Migrating To WindowsMigrating To Windows

3M UNIX3M UNIX servers servers

worldwideworldwide

Windows UNIX Migrations forecasted to grow 150%

2.7M Novell2.7M Novell servers servers

worldwideworldwide

50% of 50% of hardware hardware 4+ years old4+ years old

18,00018,000 mainframes mainframes worldwideworldwide

12,600 12,600 MainframesMainframes

85% below 85% below 1,000 MIPS1,000 MIPS

Platform Platform MigrationMigration“For the first time [2004],

spending on Windows servers ranked #1 among all OS’…”

““WWe got to market six months faster, and e got to market six months faster, and saw 14% in cost savings over Linux…" saw 14% in cost savings over Linux…" 

“…“…our IT savings is estimated at $250,000 in our IT savings is estimated at $250,000 in reduced support staffing and licensing costs”reduced support staffing and licensing costs”

““When we compared the TCO of Windows Server When we compared the TCO of Windows Server 2003 to Linux, we found a 20 percent cost in 2003 to Linux, we found a 20 percent cost in Microsoft's favor…”Microsoft's favor…”

““Windows Server System will deliver substantial Windows Server System will deliver substantial cost savings for us at a level of performance cost savings for us at a level of performance equal to or greater than what we saw on equal to or greater than what we saw on UNIX…”UNIX…”

Most 32-bit apps get Most 32-bit apps get increased performanceincreased performanceBest performance and scalabilityBest performance and scalabilityCore OS performance benefitsCore OS performance benefits

Extends value of 32-bit applications Extends value of 32-bit applications Evolutionary path to 64-bit technologyEvolutionary path to 64-bit technologyGreater price-performance Greater price-performance

Itanium: Most scalableItanium: Most scalableX64: Most versatileX64: Most versatile

WorkloadWorkload Performance and ScalePerformance and Scale

32-bit Business 32-bit Business AppsApps

NetworkingNetworking

FileFile

Active DirectoryActive Directory

Terminal ServicesTerminal Services

SAP 18% more usersSAP 18% more users

Record 7Gbit/sec xferRecord 7Gbit/sec xfer

111% higher user 111% higher user capacitycapacity

2x higher throughput2x higher throughput

170% more Users170% more Users

Abhijit (Abhi) Y. Talwalkar Abhijit (Abhi) Y. Talwalkar Vice PresidentVice PresidentGeneral Manager, Digital Enterprise General Manager, Digital Enterprise GroupGroupINTEL CorporationINTEL Corporation

partner

64-Bit Roadmap64-Bit Roadmap

Itanium 64-bit Itanium 64-bit ISAISA

64-bit Windows 64-bit Windows on on

Itanium AnnouncItanium Announceded

ItaniumItanium

Microsoft ships Microsoft ships support for support for Itanium 1Itanium 1

Itanium 2 shipsItanium 2 ships

Microsoft ships Microsoft ships support for support for Itanium 2Itanium 2

64-bit Dual Xeon64-bit Dual Xeon

64-bit Xeon 64-bit Xeon multiprocessmultiprocess

oror

64-bit64-bitPentiumPentium

Windows Windows x64x64

Multicore Multicore 64-bit 64-bit ItaniumItaniumAll servers 64-All servers 64-bitbit

Multicore Multicore 64-bit 64-bit XeonXeon

DatabasesDatabases

Line of Line of business business applicationsapplications

All All workloadsworkloads

$40,000,000$40,000,000 $1,000,000$1,000,000 <$5,000<$5,000

10 Gflops of Computing10 Gflops of Computing

HPCHPC

Ryan WaiteRyan WaiteGroup Program ManagerGroup Program ManagerHigh Performance High Performance Computing GroupComputing Group

demo

Server OpportunitiesServer Opportunities

Small Business Small Business OpportunityOpportunityLicenses Since LaunchLicenses Since LaunchSmall Business Small Business

ServerServerGrowing to 1.8M Growing to 1.8M run-rate by 2008 (IDC)run-rate by 2008 (IDC)

70% pre-installed70% pre-installed

On average, pulls 5 new On average, pulls 5 new desktops per installdesktops per install

18M multi-PC small businesses without 18M multi-PC small businesses without serversserversOpportunity for small business form Opportunity for small business form factorsfactors

Database Database OpportunityOpportunity

Database & Database & Business Business Intelligence markets Intelligence markets are still growing are still growing strongstrong

6,000 customers will 6,000 customers will upgrade ERP in upgrade ERP in 2004 (Gartner)2004 (Gartner)

BI/DW is Top of Mind BI/DW is Top of Mind of CIOs (Merrill of CIOs (Merrill Lynch CIO Survey, Lynch CIO Survey, 2004)2004)

Business Business Intelligence Intelligence

Revenues (IDC)Revenues (IDC)

Database Database Revenues (IDC)Revenues (IDC)

Fastest growing database Fastest growing database in enterprise segmentin enterprise segment

#1 in OLAP market share#1 in OLAP market share

Reduces software, Reduces software, hardware, and hardware, and maintenance TCO by 50%maintenance TCO by 50%

Deep integration with .NETDeep integration with .NET

Real-time business Real-time business intelligenceintelligence

High availability and High availability and securitysecurity

Native XMLNative XML

New SAP New SAP CustomersCustomers

Growth of Growth of Database Database ProductsProducts

Storage Storage OpportunityOpportunity

Backup today is Backup today is expensive and expensive and unreliableunreliable

Movement Movement towards disk-towards disk-based backupbased backup

10% of 10% of enterprises enterprises deploying in next deploying in next 12 months12 months

Data Protection Data Protection Revenues (IDC)Revenues (IDC)

External Disk Storage External Disk Storage Systems (RAID) Systems (RAID) 62% CAGR (IDC)62% CAGR (IDC)

ClientsClients

Tape Tape LibraryLibrary

DPS DPS ServersServers

File ServersFile Servers

Rapid and reliable recoveryRapid and reliable recoveryContinuous, efficient Continuous, efficient protectionprotectionBest valueBest valueNewNew servers that sit between servers that sit between file servers and tape backup file servers and tape backup systemssystemsStorage is 2.5 times the data Storage is 2.5 times the data being protectedbeing protected

Dedicated file and print serverDedicated file and print serverFixed-function device built on Fixed-function device built on Windows technologyWindows technologyPreviously Windows-powered Previously Windows-powered NAS NAS

“Windows has over 53% of the worldwide NAS unit market share.”

- Gartner Group Q1 CY04 NAS Marketshare

Report

Simple SANSimple SAN

Keith HagemanKeith HagemanSenior Technical Senior Technical EvangelistEvangelistWindows Server DivisionWindows Server Division

demo

Manageability OpportunityManageability Opportunity

Windows Server Active Windows Server Active DirectoryDirectoryOpportunities for Hardware IntegrationOpportunities for Hardware Integration

Active DirectoryActive Directory*Internal Microsoft Research Fall 2004

Count on ADCount on ADBeing ThereBeing There

Network & Network & Device Device

AuthenticationAuthenticationKerberosKerberosCertificate Certificate RADIUSRADIUS802.1x802.1xPEAPPEAP

Printer and Printer and device locationdevice location

Smartcard and Smartcard and password password authenticationauthentication

SMS plug-inSMS plug-inManagement packsManagement packsDriver qualityDriver qualityWS-ManagementWS-Management

Reduce ops Reduce ops TCOTCOImproved Improved monitoringmonitoringModel complex Model complex systemssystems

Faster deliveryFaster deliveryReduced attack Reduced attack areaareaNew platformsNew platforms

demo

WS-Management WS-Management InteroperabilityInteroperability

Josh CohenJosh CohenManagement EvangelistManagement EvangelistWindows and Enterprise Windows and Enterprise Management DivisionManagement Division

Great for test/dev, productionGreat for test/dev, production

Management Pack for VS: Management Pack for VS: Available TodayAvailable Today

Virtual Server 2005 SP1: Virtual Server 2005 SP1: Beta TodayBeta Today

33rdrd party guest OS support, inc. Linux party guest OS support, inc. Linux

30% performance improvement30% performance improvement

64-bit host support64-bit host support

Broad licensing of .vhd format: Broad licensing of .vhd format: Fall Fall AvailabilityAvailability

Broad Windows Server System supportBroad Windows Server System support

Longhorn TimeframeLonghorn TimeframeVirtualization: InvestmentsVirtualization: Investments

Deliver extensible .vhd formatDeliver extensible .vhd format

Windows hypervisor technologyWindows hypervisor technology

Support for hardware Support for hardware virtualization technologiesvirtualization technologies

Intel VT and AMD PacificaIntel VT and AMD Pacifica

System Center System Center virtualization managementvirtualization management

Form factorsForm factors

SimplSimple e SANSAN

DatacentDatacenter SANer SAN

Moving ForwardMoving Forward64-bit drivers64-bit drivers

Simple SANSimple SAN

Disk data protectionDisk data protection

WS-ManagementWS-Management

MOM Management PackMOM Management Pack

New Form factorsNew Form factors

High Performance ComputingHigh Performance Computing

AD authentication across devicesAD authentication across devices