COSTS INVOLVED IN A BASIC SERVER

Electricity
Cost of license
No of servers per admin
Annual salary
Cost per server for admin

250
750
40
80000
2000

COST OF PESA TOOL

R&D cost incurred
Basic server market
Expected market share
Market for Atlantic Basic server
Expected market share for Tronn + PESA
(50% attach rate)
Cost per server

2001
50000
4%
2000
1000
189

2000000
2002
2003
70000
92000
9%
14%
6300
12880
3150

6440

00000
Total in 3 years

21180
10590

OPTION 1 : PRICE WITH PE

Price
Tronn without PESA
Tronn with PESA

COST INCURRED BY CUSTOMER

price
2000
Electricity
250
License
750
Admin cost
2000
Total cost in a year
5000

Cost
2000
2000

Profit
1538
1727

462
273

OPTION 1 : PRICE WITH PESA AS FREE

Margin
30%
16%

OPTION 2 : COMPETITIVE PRICING B

1 Tronn server with PESA = 4 Zink servers

Cost of Zink server
Cost of four since servr

1700
6800

COST INCURRED BY CUSTOMER

1 TRON SERVER
Electricity
License
Admin cost
price
Total

250
750
2000
6800
9800

N 2 : COMPETITIVE PRICING BASED ON ZINK

ink servers

OPTION 3: COST PLUS PRICING

Cost per server

Tronn without PESA
Tronn with PESA

1538
1538 + 189 = 1727

CING

Markup price (@30%)

Profit
2000
462
2245
519

OPTION 4 : VALUE BASED PRCING USING CONS

CONSERVATIVLY 2 TRONN SERVERS = 4 ZINK SERVERS

OPTION 4 : VALUE BASED PRCING USING CONSERVATIVE DATA

TRONN SERVERS = 4 ZINK SERVERS

Conservative Assumption: 2 Tronn server = 4 Zinc servers

Cost break up
2 Tronn servers
Original Price
4000
Electricity
500
License
1500
Total Cost
6000
Savings
4800
Final price (Original price + 50% of savings)
6400
Margin
(6400 - 1727)/1727 = 270%
Assumption: 1 Tronn server = 4 Zinc servers
1 Tronn servers

Cost break up
Original Price
Electricity
License
Total Cost
Savings
Final price (Original price + 50% of savings)
Margin

2000
250
750
3000
7800
5900
(6400 - 1727)/1727 = 240%

Zinc servers
4 Zinc servers
6800
1000
3000
10800
4800
6400
- 1727)/1727 = 270%

ervers
4 Zinc servers
6800
1000
3000
10800
7800
5900
- 1727)/1727 = 240%