The Software Industry Report
The Software Industry Report1.0
Through this report I am aiming to examine the software industry on an international scale. It is an in depth analysis of an industry strongly dominated and influenced by a powerful monopoly, examining the following;
a) The market structure, its history, potential competition and its trends.
b) The industry�s conduct in terms of advertising, pricing policies, branding, merger activity, with particular focus on the main player.
c) The industry�s performance in terms of innovation due to new technology and the changing environment as well as profitability and efficiency.
2.0
I have taken information from various sources, these include extracts from the Independent, Economist, Computer Business Review and the MINTEL reports for 1996 and also from various sites on the Internet.
3.0
Software is an extremely Labour intensive activity and therefore it is essentially a 100% value adding process. It could possibly be labelled as a unique commercial phenomenon, but it requires much maintenance and a continual need for improvement and enhancement. The software industry can be split into three broad sectors:
? Small Office, Home Office (SO-HO)
? Games
? Industrial Use
Because of the difficulty in separating consumer software purchased by individuals, into applications destined for use by businesses and the home user. I am going to primarily focus on So-ho, home user market, and takes account of the software packages bought, mainly through out the retail market for the small or home office and which may be used for business, education or simply leisure purposes.
The most common software packages sold to the So-ho user market are the following:
? Business application software - word-processors, spreadsheet, databases, desktop publishing programs, programming languages, utilities etc.
? Operating systems - MS-DOS, DRDOS, Windows 3.x, Windows 95, 98, Macintosh System 7
? Educational software - e.g. Encarta �98
? Entertainment software - e.g. games
The definition does not include software written for the traditional 8-bit home computer hardware including the Commadore Amiga & Atari, Sinclair, Acorn, BBC or Amstrad machines. These machines went into sharp decline due to the capabilities and enhancement of the P.C, and have subsequently been withdrawn from the UK market. Within the computer market today, pre-loading or bunding of software with hardware have been used as an incentive to buyers and is an important channel for obtaining software for the home user. However within this report only single purchases of software are taken into consideration and bundled software is considered to be part of the hardware package.
3.1
Software has become an International commodity with large world wide businesses, domestic and industrial markets for general purpose software and world markets are also open for specialised software. In 1985, the U.S.A�s Department of commerce put the world market for software at $40 billion and annual growth was estimated to be about 40% , The diagram below illustrates this:...
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