The Enterprise Software Business Is Dead - as we knew it...

It is getting more and more difficult to get enterprise customers to pay for software licenses, especially for anything new (ie. not already part of their "stack") or from a start-up. The open source movement, the movement toward building custom software using off-shore develoopment, and now SaaS have conditioned IT organizations to pay for services, but not for licenses. The enterprise software license model is dead, replaced by a services model. But services, usually a combination support subscriptions and implementation, integration, development services, will not scale as well as pure software license models. Most importantly, the incentive to invest in innovative software development will be diminshed. It is hard to justify paying for software R&D when you have to give the results away just to get services revenue. I, for one, am mourning the passing of the pure software license model.

Let's talk ....about SOA

SOA is a hot topic, so why isn't it a hot business. Everyone I talk with who is involved with companies, both start-ups and big guys, selling some kind of SOA tool set, or platform, or whatever, complains that they aren't selling much yet, and aren't really sure why. There are lots of theories about missing pieces, long planning cycles, and difficulty getting the buisness guys to understand the need to invest in it. Gartner puts SOA right in the middle of the "trough of disillusionment". That is probably right. SOA will be very good for enterprise, and extra-exterprise productivity and agility when it does move from hot topic to real adoption. It will allow appicaitons to be more flexible and keep costs of improving business applications down, helping to alleviate two really big drags on business productivity improvements.

If you are a tech-type and want to play with building web services that front end a composite of various applications and data sources, you can download a free development and test environment from XAware (one of my portfolio companies). Go to http://xaware.com/downloadregistration.aspx

Milton Friedman

I was at Stanford a few weeks ago. I dropped by the Hoover Institute to look for Milton Friedman. I thought I would just drop in to introduce myself and say hello. Dr. Friedman was not in. Too bad, I said, I'll stop in again when I next get to Stanford. I was saddened today to learn that I will never have that opportunity. I am greatly disappointed to have never met the great man. I know many who have. All tell of a man of such superior intelligence, thoughfulness, and comprehension that he may have been of another world. I guess I hoped that, in meeting him and shaking his hand, some of that might somehow rub off on me. Milton Friedman changed the world, explaining, in language all could understand, why government planning fails and freedom works. He will be missed.