Sterling Commerce Innovation Through Business Model Change © 2009 Sterling Commerce Jim Hendrickson Vice President Corporate Development

© 2009 Sterling Commerce

The Motivation For Change: Competitive Pressure © 2009 Sterling Commerce Supply Chain Transaction Services Data Integration B2B Integration

The Motivation For Change: Competitive Pressure © 2009 Sterling Commerce 1999 1999 1999 Supply Chain Transaction Services Data Integration B2B Integration Traditional Competitors (5) Traditional Competitors (3) Traditional Competitors (3)

The Motivation For Change: Competitive Pressure © 2009 Sterling Commerce New Competitors (15) New Competitors (5) New Competitors (4) 1999 1999 1999 2000 - 2003 2000 - 2003 2000 - 2003 Supply Chain Transaction Services Data Integration B2B Integration Traditional Competitors (5) Competitive Overlap Competitive Overlap Traditional Competitors (3) Traditional Competitors (3)

The Motivation For Change: Competitive Pressure © 2009 Sterling Commerce New Competitors (15) New Competitors (5) 2001 2003 2002 New Competitors (4) 1999 1999 1999 2000 - 2003 2000 - 2003 2000 - 2003 Supply Chain Transaction Services Data Integration B2B Integration Traditional Competitors (5) Competitive Overlap Competitive Overlap Traditional Competitors (3) EAI Market New Competitors (11) Traditional Competitors (3)

The Motivation For Change: Competitive Pressure © 2009 Sterling Commerce New Competitors (15) New Competitors (5) 2001 2003 2002 New Competitors (4) (1) (3) (1) 1999 1999 1999 2000 - 2003 2000 - 2003 2000 - 2003 2003 Supply Chain Transaction Services Data Integration B2B Integration Traditional Competitors (5) Competitive Overlap Competitive Overlap Traditional Competitors (3) EAI Market New Competitors (11) Traditional Competitors (3) Mega Vendors

The Innovation Objective: Change the Competitive Basis Must Address Traditional Competitors Must Address Disruptors Must Address Future Competitors Must Provide More Value To The Customer Must Improve Market Presence © 2009 Sterling Commerce January 1, 2003 Sterling Commerce Traditional Competitors Traditional Competitors Disruptive Competitors Mega Competitors Adjacent Competitors Scale-Based Competitors Supply Chain Transaction Services Data Integration B2B Integration

Must Address Traditional Competitors

Must Address Disruptors

Must Address Future Competitors

Must Provide More Value To The Customer

Must Improve Market Presence

The Innovation Objective: Change the Competitive Basis © 2009 Sterling Commerce The Competitive Foundation Traditional Competitors Traditional Competitors Disruptive Competitors Future Competitors Adjacent Competitors Scale-Based Competitors Inorganic Activity Enter Enterprise Applications Market Leverage Applications to build Strategic Alliances Use Inbound Partners to Round Out Product Strategy Leverage the “New” AT&T as a Core Channel For New Distribution 2003 - 2006 2006 - Present Supply Chain Transaction Services Data Integration B2B Integration Organic Activity Organic Activity

Enter Enterprise Applications Market

Leverage Applications to build Strategic Alliances

Use Inbound Partners to Round Out Product

Strategy

Leverage the “New” AT&T as a Core Channel For New Distribution

The Innovation Objective: Change the Competitive Basis © 2009 Sterling Commerce Traditional Competitors Traditional Competitors Disruptive Competitors Future Competitors Adjacent Competitors Scale-Based Competitors Change The Basis of Competition Integration Software Supply Chain Enterprise Software The New Competitive Foundation

The Innovation Objective: Change the Competitive Basis © 2009 Sterling Commerce Future Competitors Adjacent Competitors Scale-Based Competitors Integration Software Supply Chain Enterprise Software The New Competitive Foundation Competitor’s Gap

The Value Of Change and Innovation Customer Value Increased the Value We Can Deliver to a Customer Increased our Ability to be a “One-Stop” Shop Provided a More Complete Set of Solutions in our Industries Business Model Value Entered A New Market (Enterprise Applications) Created Interest and Demand With Global Alliance Partners Recognized the Need and Capability to Expand Distribution Options Competitive Value Changed the Basis of Competition Among Traditional Competitors Created a Defensible Strategy Among Distributive Competitors Positioned Ourselves to Compete with New Competitors © 2009 Sterling Commerce

Customer Value

Increased the Value We Can Deliver to a Customer

Increased our Ability to be a “One-Stop” Shop

Provided a More Complete Set of Solutions in our Industries

Business Model Value

Entered A New Market (Enterprise Applications)

Created Interest and Demand With Global Alliance Partners

Recognized the Need and Capability to Expand Distribution Options

Competitive Value

Changed the Basis of Competition Among Traditional Competitors

Created a Defensible Strategy Among Distributive Competitors

Positioned Ourselves to Compete with New Competitors

Five Years Later Market Impact We Sell Both Enterprise Application and Integration Suites of Products We Have Diversified Our Revenue Streams Our Value is, on Average, More than 2x our Traditional Competitors Business Model Impact We Sell and Deliver with a Number of Large Strategic Alliances We are Expanding Distribution Through Channels (AT&T Is the Largest) We are Evaluating Our Global Options To Further Grow Distribution Competitive Impact Many of our Traditional Competitors were Bought or are Less Relevant We are Able to Compete with the Largest Software Vendors In the World Significant New Synergy with AT&T Since SBC Purchased AT&T © 2009 Sterling Commerce

Market Impact

We Sell Both Enterprise Application and Integration Suites of Products

We Have Diversified Our Revenue Streams

Our Value is, on Average, More than 2x our Traditional Competitors

Business Model Impact

We Sell and Deliver with a Number of Large Strategic Alliances

We are Expanding Distribution Through Channels (AT&T Is the Largest)

We are Evaluating Our Global Options To Further Grow Distribution

Competitive Impact

Many of our Traditional Competitors were Bought or are Less Relevant

We are Able to Compete with the Largest Software Vendors In the World

Significant New Synergy with AT&T Since SBC Purchased AT&T

What We Learned Changing Times Require Changing Models, Especially the Business Model Customers Expect Innovation and Value from Their Vendors Market Disruption is Easier than in the Past Distribution Options and Partnering Relationships are Critical for the Future It’s Easy to Get Your Eye Off the Ball (Priorities, Priorities, Priorities) You Can’t Capture A Global Market Until You’ve First Captured Markets! Innovation for Change Sake is not Innovation; There Must Be Real Value © 2009 Sterling Commerce

Changing Times Require Changing Models, Especially the Business Model

Customers Expect Innovation and Value from Their Vendors

Market Disruption is Easier than in the Past

Distribution Options and Partnering Relationships are Critical for the Future

It’s Easy to Get Your Eye Off the Ball (Priorities, Priorities, Priorities)

You Can’t Capture A Global Market Until You’ve First Captured Markets!

Innovation for Change Sake is not Innovation; There Must Be Real Value