It is no secret the current economic situation is being considered as one of the deepest slowdowns in the modern history, and from every angle we get more proof of how serious and challenging the situation really is. Recently, the National Association of Business Economics (NABE) published their outlook from forecasters. This survey is decidedly more negative on the economic outlook for the next several quarters as a result of the intensification of credit market stresses and evidence of spillover to the real economy. Approximately 96% of the economists polled believe a recession has started, and nearly three-fourths think it will persist into 2009.

With such challenging outlook and the world economy sailing into rougher waters, ISVs are facing tough questions:

1. How long until we must face the tough decisions? What are the options and most importantly, how much are they going to cost us?
2. Should we stop investing in our product development and focus on serving our currently installed base, or should we keep investigating new technologies and other ways of innovation to be ready to go when the economy bounces back and jump ahead of the pack?
3. What are the companies and technologies that can help us to go through the “almost-perfect storm” and most importantly, how can we convince our customers that investing in IT right now it is the right thing?

If we think carefully, we will realize there is a new variable in this equation. One that was not so materially present in former economic crises. It is the abundance and maturity of Information Technology and its utilization by end users and businesses across the world. The Internet and the power of software, hardware, devices and services are responsible for a new breed of offerings never available before. Today, Information Technology can help businesses to make smart decisions and adapt quickly to the new market reality. The same way, smart decisions and the right technologies can help ISVs to sail through the storm and cross over more solidly to come through it even stronger.

Technologies like Windows Server Hyper-V 2008 can help ISVs to dramatically reduce their R&D costs and consequently reduce their customers Total Cost of Ownership (TCO) by reducing server hardware needs. Windows Server Hyper-V provides a more cost efficient solution than other Virtualization solutions in the market today with a broader array of solutions (360^o View)

• from the desktop to the data center
• integrated management for physical and virtual infrastructures
• interoperability with other platforms and solutions

Additionally, ISVs can help customers achieve reduced costs for server ownership, improving data center operations management, by making their solutions compatible with Microsoft System Center, thereby:

• enabling a more dependable infrastructure
• requiring less data center management time
• creating efficiencies for new work
• providing fast user support.

ISVs can also greatly leverage Microsoft Unified Communications (UC) technologies, integrating complete communications experiences—messaging, voice, and video—across their business applications and devices that people use every day. Unified Communications can help customers to significantly reduce travel and communications costs by facilitating on-line meetings, conferences and even trade-shows.

ISVs that develop business applications based on legacy technologies face a harder decision now with regards to the cost of development. Is that worthy keep maintaining its own solutions, like ERP Applications for example, based on older technologies that cannot benefit from the latest technologies trends? Why not considering adopting Microsoft Dynamics AX as platform and provide industry content solutions, getting immediate state-of-art technology without the migration hurdles?

ISVs will be also able to leverage Microsoft Finance to give customers payment flexibility and secure options for financing solutions. Microsoft Finance can be a very interesting resource to ISVs and provides an affordable and predictable way to acquire the IT solution that your business needs to help cut costs and increase efficiencies.

In summary, Information Technology is a key element in this economy and can be the difference between a slower or faster recovery in the aftermath. Talk to your Microsoft contacts. They look forward to helping you.

Regards,

Persio Afonso

Global ISV Team