At the bottom end there are two pressures driving down prices to zero. First whole software markets are being taken over by the majors (MS in particular) giving away or bundling software in that field as a loss leader. Browser, Email reader, Media player, text editor, html editor, image editor etc etc. Second, what is left is being given away by amateurs and open source efforts. Slightly higher up the scale, the market for shareware has disappeared as while the Internet has made distribution easy, it has also made distribution of copies easy.
In the mid range, there is a shake out as the majors continue to develop by acquisition. Producing a CRM or Accounts package now is a dead end as it is almost impossible to compete with the majors on support or marketing. With MS moving into the CMS market, it's hard to see how the Vignettes and Broadvisions will survive.
At the top end, the independents are almost inevitably VC funded. This and pressure from the S&M departments are forcing them into a cycle of fewer and fewer sales of higher and higher priced software. Focus first on Fortune 1000, then Global 500 then Global 100 is a crazy spiral where your market ends up being Exxon, GM, GE and that's it.
So of the traditional business plans, one-off licenses, selling services, subscriptions, shareware, and so on all seem to have been discredited.
But ideas for software have not dried up, and there's even plenty of scope for re-making software originally aimed at obsolete platforms. there's no shortage of code to write.
And programmers and program designers have to eat too.
So are there any viable business plans left for mass and niche market software? One recent suggestion I have heard was "Patronage". Is that feasible? Or are we now stuck, in that software will only be developed from now on either by existing large businesses, or as a hobby, with nothing in between?
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