President, Marketing and Alliances

Parallels

Jack Zubarev

2

Enable New

Services Improve Existing

Services

Cut Costs

Partner!

3

Enabling New Services – Why?

Difference in Churn* for Small Businesses:

Webhosting Service With vs. Without Email

First Year SecondYear

Third Year Fourth Year

55.0%

28.7%

19.9% 20.3%

* Based on all Parallels Panel licenses shipped in Q4 2005 and reporting <5 mailboxes

4

What about profit?

Profit on customer with

email over lifetime*

$168

Profit on customer without

email over lifetime*

-$12

No profit.

* With $10/month/customer ARPU. Lifetime 18 and 48 months respectively.

Gross Margin: 60%. Customer Acquisition Cost:

12 months of revenue

5

New Services – Become Full Service Provider

MS OCS, VoIP, and Hosted PBX Services

Parallels Server for Mac

Bare Metal Edition

Parallels Small Business Panel and Partner Marketplace v2

Messaging and

Collaboration

SaaS

VPS and Virtualized

Infrastructure

6

New Services: Hosted PBX

For SMBs

• Feature set of a sophisticated PBX with zero upfront

investments in hardware • Easy to use easy and easy to configure

• Tightly integrated with other messaging and collaboration

services • Email, document sharing, IM, web conferencing, mobility, etc.

5:30pm: Parallels Automation Update

by Oleg Melnikov

7

Pay As you Go

Billing

GUI

Hourly billing for the running time of each instance provisioned

Simplified end user GUI to streamline the process of on

boarding, growing & managing virtual infrastructure for small

businesses

Self-service API

& Elasticity

Coexisting with

Hosting

Built as a module of Parallels Automation. Will replace VPS

module allowing to offer variety of both cloud-compute and

traditional VPS services.

New Services: Cloud Compute Service

Amazon-like self-service API enabling developers to create,

suspend, start and terminate virtual machine instances on

demand for an “all-you-can-eat” model

5:00pm: Parallels Virtualization Update

by Amir Sharif

8

Improve Existing

Services

Enable New

Services

Cut Costs

Partner!

9

Difference in Churn* for Small Businesses

1 domain vs. 2 domains

* Based on all Parallels Panel licenses shipped in Q4 2005

First Year Second Year Third Year Fourth Year

19.8%

12.5%

-7.1%

7.3%

Improve Existing Services – Why?

10

And the profit is..

Life Time with Email: 43 months

Gross Margin: 60%

Acquisition Cost: 12 months

Profit over the lifetime*:

$108

Life Time with Email: 38 months

Gross Margin: 60%

Acquisition Cost: 12 months

Profit over the lifetime*:

$138

28% higher

* With $10/month/customer ARPU

1 domain 2 domains

11

Improve Existing Services

Parallels Plesk Panel 10

Application Packaging Standard 1.2

Parallels Virtuozzo Containers v 4.6

Parallels Automation

MS Exchange 2010

Messaging and

Collaboration

VPS and Virtualized

Infrastructure

Other / SaaS

Shared Web Hosting

12

Enable New

Services Improve Existing

Services

Cut Costs

Partner!

13

Density Effects

Typical Cost Breakdown

Hardware & Datacenter Cost….10%

Support…………………………..15%

Admin/Maintenance……………..5%

14

Cutting Costs – Why? $1mln in VPS provider. In 4 years.

VPS Provider. 4 yr. Run. 300 new VPSs/month. 1.5% Churn.

Revenues

in Year 4:

VPSs

Year 4

$5.9mln

14.3K

Revenues

in Year 4:

VPSs

Year 4

$8.3mln

21.2K

20% higher Density of VPSs

42% Higher Revenues and 48% More Customers

15

Cut Costs

Parallels Server Bare Metal

5.0

Parallels Automation Next Generation Shared

Hosting

VPS and Virtualized

Infrastructure:

Shared Web

Hosting

16

Next Generation Shared Hosting

Available NOW!

• Density

• Simple scaling to more than 100,000 sites running on one cluster

(density of 10,000-15,000 sites per server)

• Isolation

• VPS-like SLA and isolation for the shared hosting world

• Uptime

• Over 99.9% reliability with minimal operating costs

• Reduced both planned (upgrades) and unplanned (failure) downtime

Clustered High-Density Linux Shared Hosting With Isolation

Reduced Churn Increased Margins

Decreased Support and Admin Costs

17

Enable New

Services Improve Existing

Services

Cut Costs

Parallels is your Partner in the Cloud

Thank You