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The Company
1996 Annual Report
In a world of hyper competitiveness and increasing dependence on PCs, computer crashes and system incompatibilities can be a major frustration and productivity drain. The thought of spending hours on the phone holding for technical support, or sitting around waiting for faxed technical support is simply unacceptable.

Today, providing timely technical support is a major problem for not only end-users but manufactures as well. Worldwide shipments of Windows-based PCs have been increasing so rapidly that hardware and software companies find it almost impossible to deliver expert service and support on demand to their customers - the costs are prohibitive. Dataquest, a leading research company, projected that hardware and software companies would field more than 200 million support calls in 1996, at a cost of more than 4 billion. In this environment, no one wins. The cost and complexity of providing quality support hurts manufactures profitability and competitiveness, and the user's productivity is diminished because he can't get the support he needs when he needs it.

CyberMedia is dedicated to solving the complex issues of PC service and support for enduser s and manufacturers by creating software that empowers users to fix technical problems themselves. With CyberMedia products there is no need for an enduser to plow through hundreds of pages of confusing documentation or waste valuable time on the phone trying to figure our what the cryptic message on your PC means. CyberMedia's line of ActiveHelp software which includes First Aid and Oil Change, helps users anticipate, prevent and fix the problems that inevitably arise with any Windows based PC. Automatically.

As a result, everyone wins. User's frustrations and fears are replaced by a sense of accomplishment and increased confidence, manufacturers gain more control over their costs and are able to provide more value to their customers while becoming more competitive in the process.

A New Category of Products for Functionality and Value
CyberMedia is the leading developer and marketer of products that provide automatic service and support for PC users while helping software and hardware vendors reduce support costs. More than a line of utility software products, First Aid and Oil Change signal the creation of a new category of Active Help products - products that redefine the notion of service and support and lead to the creation of new industry standards.

Advanced Technology Creates Leadership
CyberMedia's ActiveHelp technology is the key to their ongoing success and growth as an industry leader. This flexible technology consists of three elements: ActiveHelp Agents, a HelpCentral Server and CyberScript. These three elements provide a wide open, scaleable architecture for developing and updating the company's products. Each CyberMedia product incorporates ActiveHelp agents which function at the client level to detect and solve problems in the user's PC. The ActiveHelp agents connect to the CyberMedia HelpCentral Server through the Internet to access CyberMedia's extensive knowledge base of support information. This information is regularly replenished and kept up-to-date through established partnerships and alliances with leading hardware and software vendors. Lastly, CyberMedia developed CyberScript, a powerful scripting language that is being offered to third party software developers so they can incorporate new information directly on the server.

The ActiveHelp technology makes it possible for users to automatically update CyberMedia products through the Internet.

PC Agent - Internet - Help Central
The award-winning First Aid line of products defines CyberMedia's approach to automatic service and support. Selling more than 2 million units since its introduction, First Aid allows users to detect, diagnose and resolve more than 20,000 potential software problems. Remarkably simple to use, First Aid supports an extensive range of software, multimedia cards, modems and video cards. With First Aid even novice users are able to diagnose and fix most PC problems themselves.

CyberMedia now offers a full line of First Aid product for the home and corporate PC users: First Aid 97, First Aid 97 Deluxe, and First Aid 3.1. Released in October of 96, First Aid 97 is an upgrade to the award-winning First Aid 95 and was designed to support Windows 95 based applications and drivers. First Aid 97 Deluxe offers all the functionality of First Aid 97 and includes tutorials that help the customer make more productive use of their PC.

Oil Change is a revolutionary product, enabling PC users to automatically locate and install the most recent software updates, patches and hardware drivers via the Internet to their system. With Oil Change, users are assured they have the most current versions of their software on their PC, thereby enhancing their PCs' performance and avoiding problems that are often caused by outdated software.

Oil Change is also remarkably intuitive and easy to use. The software thoroughly examines a user's PC and develops a detailed inventory of the all the software and hardware drivers intalled on the users' PC. It then checks CyberMedia's Help Central Internet site to see if there are applicable updates or patches. Oil Change lists all the patches and updates that are available along with a helpful description of what each patch will do. Users are always in control of the process, having the option of installing or not installing a specific update. Oil Change completes the process by automatically retrieving and installing the selected patches onto the user's hard drive.

An Internet Strategy that Really Works
The Internet is an ideal channel for the timely updating and delivery of CyberMedia's automatic service and support products. One of the first companies to successfully exploit the power of the Internet as a long term marketing and distribution vehicle, the Internet is integral to CyberMedia's long term strategic plan. The Internet provides users with up-to-the-minute support at an extremely low cost. Coupled with the open ActiveHelp architecture the Internet provides an easy way to incorporate support for new updates, patches and other information as they become available on the Web sites. This means users can be sure they always receive the most current solutions to PC problems.

Oil Change also shows the company's commitment to the Internet as a powerful sales and distribution medium. Oil Change is a highly successful subscription-based product, generating incremental revenue beyond the initial sale of the product. With it's unique ability to locate and download updates and patches to third party applications and device drivers, Oil Change is clearly positioned to become the defacto Internet standard.

CyberMedia's focus on the Internet increases revenue and builds value for its strategic partners. Oil Change represents an opportunity for third-party software developers to amplify their existing sales and support programs. By utilizing the Oil Change platform, third-party developers can stimulate the sales of new software releases as well as peripheral products.

Alliances that Lead to Establishing Industry Standards
CyberMedia successfully established powerful alliances with third-party hardware and software vendors such as Phoenix Technologies, Ltd., a leading provider of system-level software, NEC Technologies, Fujitsu, and numerous others. These alliance increase distribution of CyberMedia products and enable third-party vendors to provide more functionality and value to their customers.

To enable third party vendors to incorporate new technical support information directly into the CyberMedia ActiveHelp server, CyberMedia plans to make CyberScript available to these vendors. This will not only increase the power of the CyberMedia database, but will help third-party manufactures better support their products and provide additional value to their customers. These strategic relationships will continue to play a critical role in the growth and development of CyberMedia as the leading provider of automatic service and support products.