Getting Lotus to bundle to half profits

Date: 1988

Snippet
Date: November 7, 1988 To: Pate Higgins From: Bil Gates Re: Excel/Lotus

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Another very important factor that we need to get working in our favor is the financial elements. If Manzi sees sales fall by 10% on 1-2-3 this will cut his profits in half. This is because he is running essentially a foxed cost operation .. We have succeeded in getting him to bundle some products (Learn, Speedup, Always, v3 upgrade) and hurt his COGS. We have not cut his sales or gotten him to spend marketing money. The effect of cutting Lotus's profit in half would be significant ...

Full Exhibit
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