Computer Associates 2006 Annual Report Download - page 33

generally accepted accounting principles in the United States of America to recognize revenue from our license
agreements ratably over the license term. For a description of how ratable revenue recognition has impacted our
financial results, refer to “Results of Operations” within Item 7, “Management’s Discussion and Analysis of
Financial Condition and Results of Operations.”
Sales and Marketing
Our sales organization operates on a worldwide basis. We operate through branches and subsidiaries located in 46
countries outside the United States. Each geographic territory offers all or most of our software products.
Approximately 47% of our revenue in fiscal year 2006 was from operations outside of the United States. As
of March 31, 2006, we had approximately 4,900 sales and sales support personnel.
In addition, CA Technology Services
TM
performs technology assessments, design, implementation and
optimization, as well as ongoing maintenance, of our customers’ IT infrastructures. CA Technology Services
leverages the best resources within CA as well as our channel partners to help customers apply the right types of
activities necessary to ensure success.
We also distribute, market, and support our software through a network of VARs, OEMs, distributors, and resellers.
As noted earlier, one of our growth strategies is to strengthen these channel partner relationships and grow our
indirect sales channel. We actively encourage VARs to market our software products. VARs often combine our
software products with specialized consulting services and provide enhanced user-specific solutions to a particular
market or sector. Facilities managers, including CSC, EDS, and IBM, often deliver IT services using our software
products to companies that prefer to outsource their IT operations.
Competition
The markets in which we compete are marked by technological change, the steady emergence of new companies and
products, evolving industry standards, and changing customer needs. Competitive differentiators include, but are not
limited to: performance, quality, breadth of product group, integration of products, brand name recognition, price,
functionality, customer support, frequency of upgrades and updates, manageability of products, and reputation.
We compete with many established companies in the markets we serve. Some of these companies have substantially
greater financial, marketing, and technological resources, larger distribution capabilities, earlier access to customers,
and greater opportunity to address customers’ various information technology requirements than we do. These factors
may provide our competitors with an advantage in penetrating markets with their products. We also compete with
many smaller, less established companies that may be able to focus more effectively on specific product areas or
markets. Because of the breadth of our product offerings, an individual competitor does not generally compete with us
across all of our product areas. Some of our key competitors include BMC, Compuware, EMC, HP, IBM, Mercury
Interactive and Symantec. We believe that we have a competitive advantage in the marketplace with the breadth and
quality of our product offerings; our products’ hardware independence; and the ability to offer our solutions as product
modules or as integrated suites, so that customers can use them at their own pace.
Employees
The table below sets forth the approximate number of employees by location and functional area as of March 31,
2006:
Location
Employees as
of March 31,
2006 Functional Area
Employees as
of March 31,
2006
Corporate headquarters ........ 2,200 Product development and
support .................... 5,800
Sales and support............. 4,900
Other U.S. offices ............ 6,200 Professional services .......... 1,400
Information technology support,
International offices ........... 7,600 finance, and administration...... 3,900
Total . . . ................... 16,000 Total . . .................... 16,000
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