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Über dieses Buch

Whether ERP software, office applications, open-source products or online games: In terms of its economic characteristics, software differs fundamentally from industrial goods or services. Based on the economic principles and rules of the software industry, the book reveals strategies and business models to software vendors that comprise cooperation, distribution, pricing and production and industrialization strategies, as well as software as a service and platform concepts. Further aspects including the outsourcing behavior of software vendors and users; providing business software as open source software; selecting software; and the value chains in the software industry are also addressed. Based on a number of expert meetings, it contains numerous case studies and new empirical findings. Target audience of the book are professionals and executives from the software, consulting and IT branches as well as students and scholars of business administration, computer science, business and industrial engineering.





Chapter 1. The Rules in the Software Industry

The software industry is fundamentally different from other industries. This is partly due to the unique nature of software as a product, but also the structure of software markets.

Peter Buxmann, Heiner Diefenbach, Thomas Hess

Chapter 2. Economic Principles in the Software Industry

Having described the basic rules of the game in

Chap. 1

, we now turn to the economic principles in the software industry. We begin by discussing the properties of digital goods (Sect. 2.1), and go on to examine network effects on software markets (Sect. 2.2.) and the closely related issue of standardization (Sect. 2.3). We will also be looking at aspects of transaction cost (Sect. 2.4) and principal-agent theory (Sect. 2.5) that are of particular relevance to the software industry

Peter Buxmann, Heiner Diefenbach, Thomas Hess

Chapter 3. Software Vendor Strategies

Against the background of the economic principles described in the previous chapter, this chapter examines selected strategies for software vendors. The vendor’s positioning within the value chain is of critical importance. In this context, we also look at acquisitions, which play a key role in software markets. In addition, we discuss sales strategies and pricing strategies. We conclude by exploring key management questions concerning the development of software.

Peter Buxmann, Heiner Diefenbach, Thomas Hess

Specific issues

Chapter 4. Outsourcing and Offshoring of Software Development

There are few industries more international than the software industry. This can be traced back to the characteristics of software itself: code can be developed anywhere and delivered over the Internet in seconds. In contrast to a physical supply chain, the costs for transporting products or components are practically zero. This means providers can develop software in globally distributed projects. In turn, this keeps labor costs down, while also giving companies access to a worldwide talent pool. User companies that outsource their development tasks to software providers can also exploit these advantages.

Peter Buxmann, Heiner Diefenbach, Thomas Hess

Chapter 5. Platform Concepts

The rise of platform concepts can be observed in numerous industries. The automotive industry was already hailing product platforms as a recipe for success back in the 1990s.

Peter Buxmann, Heiner Diefenbach, Thomas Hess

Chapter 6. Software as a Service: The Application Level of Cloud Computing

This chapter is devoted to cloud computing, a new form of IT service delivery via the Internet. The main focus will be on the Software as a Service (SaaS) concept, as this book primarily discusses issues relating to software rather than hardware. SaaS is regarded as a key trend—and figures on many IT decision-makers’ agendas. SaaS involves providing a standard software solution to customers in the form of a service over the Internet. The SaaS provider is responsible for the operation and maintenance of the multitenant software. These providers do not charge license fees. Instead, users pay fees for the right to use software components and services.

Peter Buxmann, Heiner Diefenbach, Thomas Hess

Chapter 7. Open Source Software

Software providers in the narrower sense create software in order to generate license sales and in some cases, revenue from services. A different motivation lies behind open source projects. Software developers come together in an international community to pool their knowledge and jointly solve a problem. In this scenario, many developers invest their time, normally without being paid. But it does not follow that open source software (OSS) is irrelevant in an economic sense. In this chapter, we will explore the fundamental questions that OSS poses to the software industry and to users.

Peter Buxmann, Heiner Diefenbach, Thomas Hess


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