Independent Software Vendor Royalty Licensing Program Program Overview Overview The ISV Royalty Licensing Program offers independent software vendors (ISVs) a convenient way to integrate Microsoft® licensed products into their software business applications, replicate the business solution, and distribute a fully licensed solution to your customers. ISVs are organizations that exclusively develop software or software solutions instead of being part of a computer system or being a hardware manufacturer. At least 30 percent of the company’s overall revenue comes from the sales of licenses of that solution. ISVs integrate Microsoft licensed products with their application in any of the following ways: • By integrating a Microsoft licensed product into the ISV’s application code; • By including a Microsoft licensed product along with the ISV’s application on the installation media; or • By preinstalling a Microsoft licensed product on a computer system that is part of the unified solution Program Benefits The ISV Royalty Licensing Program offers ISVs the convenience of distributing to customers a complete software solution from one source. For a full program overview, including a complete list of program benefits, please see the ISV Royalty Licensing Program Guide. Here are some of the many benefits of participating in the ISV Royalty Licensing Program: • Ability to deliver a total solution. Provide one-stop shopping for your customers and avoid deployment delays. Customers do not have to go through a separate procurement process to acquire the Microsoft product licenses. • Potential cost reductions. May reduce installation, configuration, update, and support costs. • Potential revenue increase. You can redistribute Microsoft licenses and Embedded Maintenance upgrade coverage with your solution to provide an additional revenue stream or potential margin. • Extend product life cycle. You can sell version-specific unified solutions for up to 18 months after Microsoft releases a new version of the licensed product, which is integrated in the value-added business solution. • Wide selection of Microsoft licensed products. You have access to a wide range of Microsoft server applications, including some desktop PC applications. For a sample list of available products, please see the ISV Royalty Licensing Program Guide. • Worldwide distribution. You can distribute your unified solutions to customers in any part of the world. 1 • Earn partner points. Earn partner points in the Microsoft Partner Program by signing up to participate in the ISV Royalty Licensing Program. • Customer Demonstrations. You can demonstrate your unified solutions to prospective customers as long as you remain in possession of the demonstration copies. • Customer evaluations. You may use the licensed products to provide your unified solutions to your prospective customers on a trial basis for up to 120 days. Participating in the Program The ISV Royalty Licensing Program allows you to license Microsoft licensed products as part of your unified solution during a three-year agreement term. You become the legal licensor of the entire unified solution, including the Microsoft licensed products that are part of your unified solution. You can offer your customers the option to include Embedded Maintenance with the licensed products included in the unified solution. Embedded Maintenance offers your customers the option to get current and stay current on Microsoft licensed products by upgrading to future product versions for a fee. License Model Each Microsoft licensed product offered through the ISV Royalty Licensing Program has an associated set of use rights. There are the two types of use rights offered: ISV License This default license type allows you the ability to integrate Microsoft licensed products and be licensed as part of your unified solution. This license also allows your customers to use the underlying Microsoft licensed product with other applications as long as they are still licensed for your application. ISV Run-time License Some licensed products offered through the ISV Royalty Licensing Program are offered with additional restricted use rights. In these cases, your customer: • Can use these applications only with the unified solution with which they were acquired. • Cannot use the Microsoft licensed products to run any other application or to develop new applications or in any other context independent of the unified solution with which it was acquired. The products that are currently offered with Run-time Use Rights are Microsoft SQL Server™, Microsoft BizTalk Server®, and Microsoft Speech Server. Eligibility and Program Requirements The Microsoft ISV Royalty Licensing Program is a worldwide software licensing program for all solutions partner segments, including ISVs, value-added resellers, value-added providers, system builders, system integrators, training providers, and support providers. The program allows ISVs to provide a unified solution, by integrating select Microsoft licensed products into your applications, and distributing to your customers. A unified solution is the software product that the ISV licenses to your customers that includes one or more Microsoft 2 licensed products, adds significant and primary functionality to the Microsoft licensed products, and may include software that the ISV acquires from third parties. The following are key requirements for participating in the ISV Royalty Licensing Program. For the full list of program requirements, please see the ISV Royalty Licensing Program Guide. • Develop a unified solution. Develop a value-added solution using Microsoft licensed products and distribute the unified solution in a tangible media form. • Revenue commitment. Commit to a minimum of US$15,000 in royalties paid to Microsoft during the three-year term of the Independent Software Vendor (ISV) Royalty License and Distribution Agreement. • Provide technical support. You are responsible for providing technical product support for the Microsoft licensed products included in the unified solution to your customers. To ensure the proper support level, you must either enroll as a Microsoft Certified Partner (or above) or purchase five technical product support incidents from Microsoft or a Gold Certified Support Partner. • Comply with the Microsoft license terms. Incorporate any applicable Microsoft license terms into the End Customer Agreement for the unified solution. • Provide monthly reporting on software licenses. Submit either a monthly royalty report or zero royalty report for all licenses that you and your affiliates distributed to your customers. If the end customer generated more than US$1,000 per month in revenue, you need include their name and address. If you did not distribute any licensed products to your customers, you need to submit a zero royalty report. Pricing and Invoicing Pricing To find out the royalty price you are charged for each Microsoft licensed product offered through the ISV Royalty Licensing Program, you may obtain the price list through explore.ms. Microsoft may decrease the price in the price list at any time. Microsoft may increase the price in the price list only once each calendar year on January 1 and at any time to offset exchange rate fluctuations for prices other than U.S. dollars. If Microsoft increases the price of a particular version of a licensed product after you sign your agreement, you are invoiced at the price in effect for that particular licensed product at that time. Invoicing Microsoft uses the information contained in the monthly royalty report to invoice you, in the applicable currency, for the royalties owed to Microsoft. Microsoft checks your agreement to determine which licensed products you are including in your unified solution, and then multiplies the price assigned to licensing those applications by the number of units of the unified solution that you have sold, as reported by you in your monthly royalty report. Microsoft then sends you an invoice for the total amount of the royalties for that calendar month. Payment terms are net 30 days of the date of the Microsoft invoice using the standard payment method. 3 Enrolling in the ISV Royalty Licensing Program To participate in the ISV Royalty Licensing Program, follow these key procedures: • Meet one of the following two requirements: o Enroll in the Microsoft Partner Program as a Microsoft Certified Partner or Gold Certified Partner at http://members.microsoft.com/partner/default.aspx o Purchase a minimum of at least five technical product support incidents for the licensed products used in the unified solution, either from Microsoft at http://support.microsoft.com/default.aspx?scid=fh;en-us;Prodoffer41a&sd=GN or from a Gold Certified Support Partner • Complete the Microsoft ISV Royalty License and Distribution Agreement and credit application form. To obtain these documents, please contact your Partner Account Manager, local subsidiary, or e-mail [email protected]. • Submit these documents to the applicable Microsoft Operations Center. The list of Microsoft Operations Centers can be found in the ISV Royalty Licensing Program Guide. The ISV Royalty Licensing Program offers you access to a wide range of Microsoft licensed products. The list of available products is updated quarterly and is available at www.explore.ms. Additional Resources ISV Royalty Licensing Program Additional information on the ISV Royalty Licensing Program. http://www.microsoft.com/licensing/programs/isv/default.mspx Professional Support Options and Phone Numbers ISVs that want to purchase the five technical product support incidents. http://support.microsoft.com/default.aspx?scid=fh;EN-US;OfferProPhone Microsoft Volume Licensing Program Information on what software licensing can do for your organization. http://www.microsoft.com/licensing/default.mspx Contact Us Contact us at [email protected] for assistance with renewal or program questions. This document is for informational purposes only. MICROSOFT MAKES NO WARRANTIES, EXPRESS OR IMPLIED, IN THIS DOCUMENT. © 2007 Microsoft Corporation. All rights reserved. Microsoft and BizTalk are either registered trademarks or trademarks of Microsoft Corporation in the United States and/or other countries. 4