Software Industry

Topics: Computer program, Computer, Computer software Pages: 7 (2014 words) Published: April 19, 2013
Software Industry

N.Kranthi Bhushan
Software Engineering-B

Software Industry

The software industry includes businesses for development, maintenance and publication of software that are using different business models, mainly either "license/maintenance based" (On Premise) or "cloud based" (such as Saas, PaaS, IaaS etc etc) . The industry also includes software services, such as training, documentation, and consulting.


The word "software" had been coined as a prank by at least 1953, but did not appear in print until the 1960s.[1] Before this time, computers were programmed either by customers, or the few commercial computer vendors of the time, such as UNIVAC and IBM. The first company founded to provide software products and services was Computer Usage Company in 1955.[2] The software industry expanded in the early 1960s, almost immediately after computers were first sold in mass-produced quantities. Universities, government, and business customers created a demand for software. Many of these programs were written in-house by full-time staff programmers. Some were distributed freely between users of a particular machine for no charge. Others were done on a commercial basis, and other firms such as Computer Sciences Corporation (founded in 1959) started to grow. The computer/hardware makers started bundling operating systems, systems software and programming environments with their machines. When Digital Equipment Corporation (DEC) brought a relatively low-priced microcomputer to market, it brought computing within reach of many more companies and universities worldwide, and it spawned great innovation in terms of new, powerful programming languages and methodologies. New software was built for microcomputers, so other manufacturers including IBM, followed DEC's example quickly, resulting in the IBM AS/400 amongst others. The industry expanded greatly with the rise of the personal computer ("PC") in the mid-1970s, which brought computing to the desktop of the office worker. In subsequent years, it also created a growing market for games, applications, and utilities. DOS, Microsoft's first operating system product, was the dominant operating system at the time. In the early years of the 21st century, another successful business model has arisen for hosted software, called software-as-a-service, or SaaS; this was at least the third time[citation needed] this model had been attempted. From the point of view of producers of some proprietary software, SaaS reduces the concerns about unauthorized copying, since it can only be accessed through the Web, and by definition no client software is loaded onto the end user's PC.

Software sectors

There are several types of businesses in the software industry. Infrastructure software, including operating systems, middleware, and databases, is made by companies and organisations such as Microsoft, Google, IBM, SAP AG, EMC and Oracle. Enterprise software, the software that automates business processes in finance, production, logistics, sales and marketing, is made by Oracle, SAP AG, Sage and Infor. Security software is made by the likes of ManageEngine Symantec, Trend Micro and Kaspersky. Several industry-specific software makers are also among the largest software companies in the world: IBM and CA Technologies for IBM mainframe environments; SunGard, making software for banks, BlackBoard making software for schools, and companies like Qualcomm or CyberVision making software for telecom companies

Size of the industry

According to market researcher DataMonitor, the size of the worldwide software industry in 2008 was US$303.8 billion, an increase of 6.5% compared to 2007. Americas account for 42.6% of the global software market's value.

Mergers and acquisitions

The software industry has been subject to a high degree of consolidation over the past couple of decades. From 1988 to 2010, 41,136 mergers and acquisitions have been announced...
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