Software Product strategy for 2005

Software products and services are at their multitudes
in the market, and at this very moment, there are tons
of new projects kicked off and newer ideas evaluated.
Not all of them are successful to develop a mind or
market share in the software arena. Hence, it is
important to study the software market dynamics and
understand what makes a product a winner in the
current scenario.

Software is very distinct from other industries; it is
the knowledge share of an individual (or) group of
individuals.
However, just getting the first working version out is
far from done. For example, FireFox 1.0 has made big
waves in the market recently. It is still lagging in
terms of maintenance; upgrade issues and integration
with products like Google Desktop and OnFolio.
Most of these products are well integrated with
Internet Explorer. So it’s going to be a while for
FireFox to become a commodity.
Software products need to undergo many time cycles in
the market where they mature to become commodities.
And a very important attribute is that they need to
integrate well with existing products in the market
and maintain compatibility across the board.

(Product Quality) * Time = Commodity
With a considerable market share.

Once they are time-tested and prove to stand on
quality, is when they become commodities sought by one
and all.
You could develop software entities in a couple of
ways:

1. Software as a service. e.g. SalesForce
2. Software as a commodity, e.g. Oracle taking
licenses for Orion (EJB Server)
3. Network Collaboration of developers: Open Source
Model/FSF: Products, which have matured over time,
e.g. Linux, Apache, Ant to name a few.

In today’s market scenario, large companies like
Cisco, IBM, and Oracle are buying over smaller bunnies
to get their hold onto commodities and the clientele.
Companies like SalesForce, Google, e-Bay are taking a
serviceability approach embracing the Internet as
their viable platform. SalesForce by its service model
has become a big threat to Siebel, Peoplesoft
(Oracle).
It is apparent now that software is undergoing a
transformation and Quality is important with
consistency.
That can only be achieved with a proven market share
over a period of time.
So, how does one get a head start in this transforming
market?

There is couple of approaches seeming apparent:

1. Do the same thing better e.g. Google with its
superior search algorithm, Oracle and its newer
version of the Application Server 10g
2. Adapt to a different serviceability model e.g.
SalesForce.
This way the customers can focus on using the
application rather than worry about upgrades,
equipment, maintenance. It is kind of On-Demand.
3. Newer technology offshoots: Companies in Biotech,
Bioinformatics and Nanotechnology areas
4. Open Source companies/ efforts: Redhat, Suse,
Linux, osdk.com
5. Become a buy out target for Infrastructure
providers who will continue to consolidate and
diversify: IBM, Oracle, Cisco and Microsoft mainly
6. Software built to facilitate commercial day-to-day
activities: Netflix, Yahoo Mail, Hotmail, PizzaHut,
waitersonwheels.com. These are services, which will
last as they blend into the lifestyle of the society.
These have a distinct advantage over Amazon and e-Bay
in terms of usage cycles of a client. Google is an
exception though.
7. Outsourcing of Infrastructure and Human Resources:
With improved networking bandwidths this is becoming a
staunch reality leading to Globalization.

To be successful in the times to come, any of the
above approaches or a combination of the above could
pay off.
There may be more innovative or esoteric approaches
yet seen, however these are the present trends.

Finally, I would like to summarize that, the market
has really matured up in terms of software uptakes and
unless companies develop closeness with customers and
add value to their enterprise in terms of improved
serviceability (or) profit margins, it will be a hard
time for growth. The Open source movement is
definitely gaining momentum, it has captured the
Operating System space with Linux/ FreeBSD and my
surmise is, it will grow upwards. Open source
databases, Open source middleware are not far from
now. However, time tested software like Microsoft
Office or the Oracle database are here to stay, at
least for sometime though further growth may be
capped.
Lastly, Applications is what people will see as value
adds and infrastructure will be taken for granted. And
as Entropy keeps increasing in the universe, so will
Software Quality. Companies who provide better
Quality, Integration and Support and further
improvisation are the ones to stay.

Note: Disclaimer: All opinions are my own and personal
and does not represent any organization or corporate like entity