Software may follow the toaster

What do the Seventies, Comdex and Bill Gates’s strategies have in common? More than you might think. Let me explain. There’s a TV commercial currently airing in which a middle-aged Soccer Dad contemplates what life might be if he once again had The Van — the fuzzy dice and shag-rug equipped cruiser once so popular with the young long-hairs.

The results of his thought experiment are depressing. Dad simply looks foolish. He learns that everything has its time and place, and that the time for The Van has clearly come and gone.

The same is true of Comdex. As I write this, it looks as though the 2003 version of the granddaddy Vegas show is likely to be the last. The 2003 Canadian version has already been postponed once, and cancelled twice.

The possible end of Comdex means more than just one less reason to hit Caesar’s Palace. It’s also a sign of a larger trend.

And it’s not the only sign — it’s become clear that Microsoft Corp. is looking to make a very big acquisition in the enterprise software space. Today we know that SAP AG was almost folded into the Redmond empire earlier this year, and that Microsoft officials also considered coming to the “aid” of ERP maker PeopleSoft Inc., as it tries to ward off a hostile takeover bid from rival Oracle Corp.

The fall of Comdex, turmoil in the ERP sector and Microsoft’s ambitions are all sure signs that software is slowly moving toward commoditization. Vendors aren’t interested in the big-bang tradeshow anymore, in part because showing off the latest and greatest in software to random crowds doesn’t work anymore. In the back office, the money is now in services and customer maintenance. Functionality is increasingly less of an edge.

Meanwhile, the ERP players are looking to come to the smaller customers, where Microsoft reigns supreme. In short, the big guys want to bring Windows upstream, and push their power downstream, while Microsoft would like to prove once and for all that it belongs in the high-end computing realm. A big buy would be the quickest route, and it’s almost sure thing. Such a move would almost certainly trigger other buyouts and mergers, meaning bigger players, each offering one-stop shops for IT departments.

This is a slow process, and the software industry is still subject to the ebbs and flow of innovation and the question of Linux. But the software makers are slowly arming themselves for a different playing field, one for which we should all be prepared.

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Jim Love, Chief Content Officer, IT World Canada

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