On Sat, 26 Nov 2005 11:26:30 +0100, Martin P. Hellwig wrote:
> Steven D'Aprano wrote:
>> On Thu, 24 Nov 2005 17:43:22 +0100, Martin P. Hellwig wrote:
>>
>>> if I owned a company
>>> making profit on software sales (sale =! support) you sign a death wish
>>> for using GPL
>>
>> Apart from Microsoft, and possibly Quark (makers of Quark Express desktop
>> packaging software), and perhaps a few console game developers, is there
>> any company making a profit on software sales?
>>
>>
>
> Eehm, about hundreds of thousands customized software manufactures
> around the whole globe?
They don't sell software, they sell services: their expertise in
developing software. The difference is analogous to going to a builder to
buy a house, and going to a builder and paying him to build you a house.
I should know what I'm talking about: I work for one of them.
> Where not talking about off the shell software then of course, but for
> software used in a particular corner of a sector.
And that's not "off the shelf"?
> Most prominent types
> are administration software, although most of them have a common base,
> implementation differs on your type of: products, customers, location,
> law, quality and quantity . Say about everything it can differ, ie you
> don't want to use your high-school student administration program for a
> pet shop or a cheese manufacture.
I think you are over-estimating both the numbers and profitability of such
niche software distributors, and misunderstanding the business models of
them.
Let me give you an example: some years ago, I was involved in an IT
project where a small wholesaler changed accounting software. Without
mentioning names, they purchased some licences to a mid-level package from
a consultant. I later found out that the consultant in fact made little
money from the sale: perhaps a few tens of dollars out of multiple
thousands. Most of the initial sale price went to the software vendor. The
consultant made her money from services: installation and training mostly.
Of course the software vendor made *some* money from the sale, but in
fact the majority of their income came from yearly service fees,
upgrade fees, compulsory upgrades ("pay for this upgrade or we will no
longer support your system"), customizations and similar. But even if
they were making some money from sales, that doesn't guarantee
profitability.
"Being in the software business" can and will remain profitable into the
future, but I have serious reservations that "selling software" will be --
even today, few companies make money from selling software and rely more
on associated services for the bulk of their income.
Which is exactly what economics tells us to expect.
--
Steven.
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