FOR IMMEDIATE RELEASE

Lotus to "Superdistribute" Frontline Systems'
New Solver Component for 1-2-3 97 Edition

INCLINE VILLAGE, NV -- November 17, 1996 -- The terms under which the new Solver for Lotus 1-2-3 97 Edition has been developed and is being offered to users is an example of a new paradigm for marketing business productivity software, using the policy and technology of "superdistribution."

OEM Components. The Solver is a tool which enables users to find optimal solutions to resource allocation problems. In Excel, Quattro Pro, and previous releases of 1-2-3, the Solver has been a built-in or "bundled" component. The spreadsheet vendor has paid for development of the Solver, either in-house or through an OEM arrangement, and spread the cost of this component (and many others) over a large installed base. But this meant that all users implicitly paid for the Solver and every other specialized feature of a large, complex program (1-2-3), even if they never used many of those features. Moreover, users for whom the Solver was especially important had to make do with the "one size fits all" built-in component. Such users have always found it difficult to obtain technical support, since even trained support reps for a product like 1-2-3 cannot be expected to master every specialized component.

Third-Party Products. In the past, the main alternative to a built-in component has been a third-party "add-in" product, which is developed independently and marketed through cooperative business partner programs. But since the distribution and marketing of these third-party products is decoupled from the distribution of the "base product" such as 1-2-3, users often have a difficult time finding out about such products and determining whether they are suitable for their needs. For third-party vendors, the high cost of marketing to the broad installed base of the "base product" has been difficult to justify, and has usually meant higher prices for those users who do need the add-in product.

New Approach for the Solver. The new Solver for 1-2-3 97 Edition is being handled in a very different way. Unlike general third-party products, the Solver is a specific component that Lotus wanted for 1-2-3 97, to replace and upgrade the earlier solver in 1-2-3 Release 5. Technical development of the Solver proceeded much like an OEM component in parallel with the rest of 1-2-3 97, leveraging Lotus's internal object-oriented architecture for 1-2-3 and Frontline's existing solver technology. But Frontline has developed the Solver at its own expense, and will provide support for the Solver directly to end users.

Superdistribution of the Solver. Although the Solver is a Frontline Systems product, its marketing and distribution is closely coupled with 1-2-3 97 and SmartSuite 97. Copies of the Solver are included on the 1-2-3 and SmartSuite CD-ROMs, while users purchasing floppy disk media will be able to download the Solver from either the Lotus or Frontline Web sites. The Solver will also be included when 1-2-3 or SmartSuite is "bundled" with new PCs from IBM and other hardware vendors. The new Solver is being featured in Lotus's publicity and press information on 1-2-3 and SmartSuite, and it appears on one of the "billboards" when 1-2-3 is installed. Within 1-2-3 itself, the Solver is described in online Help with information on upward compatibility for 1-2-3 Release 5 solver users.

Paying for Use, not Copies. How can this business arrangement work? The answer lies in the technology and policy of superdistribution: Users need not pay for copies of the Solver, but only for its use. All users receive a limited-use, fully-functional "trial" copy of the Solver, good for 100 "solves" or problem solution attempts. Every user has a chance to try out the Solver and determine whether he/she wants to use it on an ongoing basis. If so, the user simply clicks a button to activate an embedded "SalesAgent" package. This package accepts a credit card number and user registration information, then automatically connects -- via the Internet or a direct modem call -- to a back-end service, which charges the credit card, registers the user for support purposes, and transmits an unlocking code to the user's PC. Users without an Internet or modem link may instead call a 24-hour 800 number, or send their order by fax or regular mail. The "SalesAgent" package, which supports the superdistribution concept, was developed by Release Software Corporation (http://www.releasesoft.com, 415-833-0200) and is licensed to Frontline Systems.

Free and Fee-Based Support. Frontline Systems will directly support end users of the Solver, through a combination of free electronic support facilities such as an extensive Web site and online discussion groups, and fee-based telephone support. The rates Frontline will charge for support are essentially the same as the rates charged by Lotus, but because the support comes from the people most knowledgeable about the Solver, users are likely to receive a better support value for their money.

Lower Marketing Costs, Better Value for Users. Thanks to the greatly reduced cost of marketing the Solver through the superdistribution approach, Frontline is able to charge a very low price ($50) for a permanent license to use the basic version of the Solver. This is one-tenth the price of any of the solver products that Frontline sells on a third-party basis. The result is that users who have no need for the Solver pay nothing, while those who do need the Solver pay a price commensurate with high-volume software distribution.

But the basic Solver version, which handles problems of up to 200 decision variables, represents only a first step for those users who find high-payback applications for the Solver. These users often want to scale up their applications to much large size, often involving thousands of decision variables. Such compute-intensive problems usually demand more powerful Solver versions, using more sophisticated algorithms, which Frontline can supply. The higher prices for these versions ($500 to $1,500) are easily justified by the cost savings or profit improvement achievable in these applications.

Besides the opportunity for upgrade versions and other ancillary sales, direct contact with the active users of the Solver -- something which is missing from the classic OEM arrangement -- enables Frontline Systems to better understand how users are applying its products, and use this knowedge to drive future development of the Solver. The result of the new superdistribution approach is a "win-win" situation for everyone: for Lotus, for Frontline, for users who don't need the Solver, and most of all, for users who do.

For More Information Contact:

Frontline Systems Inc.
P.O. Box 4288, Incline Village, NV 89450
Tel: 702-831-0300
FAX: 702-831-0314
Internet: info@frontsys.com

Copyright © 1996 Frontline Systems Inc.
Last modified: December 01, 1996