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The High-Tech Market, specifically, the PC Software arena, has
gone through many evolutionary changes in a relatively short amount
of time. Starting out as a small community of hobbyists and pioneering
developers, the PC Software market has become a multi-billion dollar
industry spanning the consumer and business to business sectors.
As we move forward within the Information Age, the PC Software
market is, once again, going through a major evolutionary change.
The change is embodied by a convergence between software publishers
and content providers. You may ask yourself why this convergence
is happening. It's due to the nature of how we are using PCs today.
Reduced PC costs, CD-ROM/DVD technologies, and widespread usage
of the Internet has turned them into 'information appliances', blurring
the distinction between software and content. As an example, let's
examine an Internet-based search engine - what, exactly, is at its
core? Is it the software or the content? It is no surprise that
this month was landmarked by the merger of the Software Publishing
Association and the Information Industry Association - a formalized
convergence of the software and content industries. As an FYI, an
individual look into these two organizations will provide us with
a better understanding of the impact and challenges that we, as
marketers, will face, as the PC Software market experiences a major
paradigm shift.
The Software Publishers Association was founded in 1984, as the
personal computer software market was beginning to take shape as
a viable business entity unto itself. Over the years, the SPA has
grown to become the principal software industry trade association,
serving more than 1,200 members internationally. The association
represents leading publishers as well as start-up firms on the Internet,
covering the business, consumer, education and enterprise markets.
Statistics from the SPA indicates that members account for 85 percent
of the revenue in the U.S. packaged and on-line software industry.
As an SPA member and speaker for many years, I have been 'hands-on'
with many of the milestone changes within this community. One of
the most significant changes was the resolution of the retail 'channel
conflict' dilemma. Software publishers tactfully structured their
marketing and promotional activities so that their retail presence
could profitably co-exist with direct sales activities performed
via direct mail marketing. The formalization and acceptance of upgrade
and cross-grade promotional activities was a major milestone, as
publishers realized that these activities alone could account for
a major share of their overall bottom-line profits.
The adoption of CD-ROM technology was a critical turning point,
as it provided the foundation for pushing the development of robust
and interactive multi-media applications.
Last but not least is the integration with the Internet, both
as a direct distribution channel and as a platform for the development
of new types of software.
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The Information Industry Association (IIA) has been around a bit
longer than the SPA. Established in 1968, the IIA represents over
550 companies involved in creating, distributing, and facilitating
the use of information in print and digital formats. The IIA's charter
is "to represent the industry's interests in government policy and
regulatory matters; to promote the industry and provide early awareness
about new developments and emerging technologies; and to provide
a business development forum for interaction among top executives
in the industry."
The IIA shows an impressive roster of member organizations, including
leading print publishers, online services, cable/communication firms,
financial institutions, research firms, global stock exchanges,
and more. So where is the synergy between these types of content
organizations and the software publishing community?
In my opinion, the new relationship between the software and content
organizations will provide the needed push for the development of
a new generation of consumer software products. I feel that the
skew will be towards the consumer side since businesses will always
need specific, mission-critical applications that are based on their
own data warehouses as opposed to external content.
In the integrated scenario of software publishers and content
providers, the software will act as the vehicle to present, deliver,
and use content in new and innovative ways. In short, the combination
of both industries will ensure further growth and development in
our information-based society and economy.
Think of the new possibilities, with major content providers working
together with the leading software companies. For one, it provides
the infrastructure for the creation and development of new digital
delivery platforms. As new standards are put into place, it could
even redefine the Web as we know it today. Educational software
will be taken to an entirely new level, as sophisticated searching
and advanced multimedia technologies are used to deliver fresh and
updated content. Individuals will be further empowered and enriched,
as information ranging from financial data to the arts and music
is packaged, bundled, and delivered into everyone's homes. It's
an exciting new era.
As one who has been very close with the software publishing community,
I am thrilled about the emergence of the Software & Information
Industry Association (SIIA). It sets the stage for an entirely new
mindset that synthesizes innovation software development with high
quality content that is being warehoused and developed on an ongoing
basis.
As marketers, we also need to be aware of channel converge as
well. We've already seen the software community emerge as Direct
Marketers on the Internet. It makes sense to see the retail community
performing Direct Marketing on the Internet as well. Overall, as
direct marketers, these exciting changes open new doors and challenges,
as we strengthen relationships with customers and place new products
into the hands of individuals.
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