The Death of Software as We Know It and Why You Should Care!

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Software has for many years been the lifeblood of businesses. A super-computer all the way to a cell phone would all be useless without software to do all the great things that make companies more productive and successful. But over the last couple of years there has been a subtle movement of the traditional model of software …even down to the way the world-wide-web is constructed. As solution providers, it is important to understand this change and what it could mean to your business, because it could be BIG.

Delivery

There is no secret that the delivery method of software has been changing over the past couple of years. I am not referring to the CD to DVD change; I am referring to the Electronic Software Delivery (ESD) revolution.  Software developers, enterprise application vendors, anti-virus software, security software companies, consumer electronics companies, game developers, semiconductor companies and many more are embracing this delivery model.

In order to decrease costs and shorten their time to market, software companies are turning to the Internet as their primary method for software delivery. This also allows them to offer their software more inexpensively while still pulling in a healthy profit. The many advantages of ESD for software developers stretch far and wide.

So what does this mean to solution providers? There will always be a market for software resellers, but ESD often means that end-users can purchase software directly from the manufacturer and download it to their computer. With the constantly improving technology enlightened workforce; the act of purchasing the software, consulting on a software choice, training customers and potentially the installation as well as future upgrade revenue, could all be lost revenue.

Software vs. Apps

Software is software, applications are software, Apps are software….while it may all be software; the terminology is increasingly being coined as just “Apps.”  Apple, Google, and now Microsoft are all in or moving towards an app based market place for software distribution.  Microsoft’s Windows 8, which is scheduled to be released this year, is based on apps as the distribution model.

But for anyone that has ever installed an app onto their phone or tablet, knows that it is much different than installing a piece of software from a CD, DVD, or even the Internet (ESD). The difference is that it pretty much just installs without any user interaction or questions.  This is exactly where Microsoft is going with Windows 8. This article my Microsoft’s VP of Windows Experience, entitled: Previewing ‘Windows 8’, mentions the words “app” or “apps” 21 times.  The ease of discovery, download, and installation of apps is amazingly simplistic. I know a lot of business owners and executives and in thinking back to conversations, many have told me about some app they discovered and installed that allows them to do things like: track sales activities, manage expenses, provide remote access to systems, monitor analytics of some part of their business, and a hundred other things that they found, installed and were using now.

So what does this mean to solution providers? Well the same thing as ESD. As software moves to becoming an app, it now appears in marketplaces like Apple, Google and Microsoft now have. Clients now can easily search for these apps, install them, test them and delete them without calling for support or consulting.  There will always be a market for consulting, and software installation, but you cannot ignore the potential lost revenue to a solution provider. Even flat fee, managed services becomes suspect when technology is so dumbed down that business owners can research, install, and test it.

HTML 5

The web is changing in a BIG way, and one of the most exciting things to ever happen to the Internet is the development of HTML 5. HTML is the primary programming language of the Internet, the newest iteration, HTML 5, promises huge advances that will completely effect how we think of software in the future. HTML has always been a static programming language, but using other languages you could make it dynamic, HTML 5 takes this a step farther.

One of the many advantages to HTML 5 is the ability to run an app, inside of a web page. That is the best way I can think of describing it. Software programmers can now turn to HTML 5 and other technologies to basically create their software in a web page. App developers for Apple products have already begun switching from App development to HTML 5, so they could avoid giving a portion of their app sale to Apple, by listing it in iTunes.

Not all apps would be perfect for running inside of a web page or turning into a web application like Sales Force, but many will. And with this change, it removes potential consulting revenue, research revenue, installation revenue, and other revenue sources from what a typical solution provider would count on, and potentially puts at risk flat fee support services that most solution providers offer.

Summary

I am not preaching doom and gloom. Opportunities are everywhere. But as trusted advisors and business owners; solution providers need to stay ahead of the curve to continue innovating their services to grow their organizations. There is no doubt that these changes will affect future revenue sources …I have already seen it happen. So don’t turn a blind-eye; be ready, be smart, innovate, and look for opportunities and ways to capitalize on the changes.

This post was written by Todd Nielsen. Todd has served as CEO, COO, President, & Vice-President, of various IT & Telecommunications companies over the last 15 years. You can read more about his experience at his blog: http://www.asliceofleadership.com

Filed in: Managed Services

About Todd Nielsen

Todd is a business executive in the IT and Telecommunications industries with over 15 years of experience dealing with rapidly changing markets and technologies. His diverse background as Vice President, Chief Operations Officer and Chief Executive Officer of various organizations has made him a strong leader and business advisor.

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