An interesting viewpoint about the software supply-demand scenario comes from
Joe Kraus of Jotspot:
The purpose of software in business is to support the way a business does business from the way a business runs its hiring and firing to the way it orders materials to the way it tracks sales. In the market-speak that surrounds the technology business, the purpose of software in business is to support these business processes.
Lets do some simple math. First, every business has multiple processes. Things like hiring, firing, selling, ordering, etc. Second, while some of these are pretty common in name from business to business (recruiting, for example), in practice, they are usually highly customized. Finally, there are simply a large number of processes that are either unique or that are common to millions of very small markets and therefore not traditionally worth the effort to buy software for (for example, the process by which an architecture firm communicates between its clients and the city planning office).
These three facts
every business has multiple processes
processes that are similar in name between businesses are actually often highly customized
there exist a large number of processes unique to millions of small clusters of industries.
means that there is a combinatorial explosion of process problems to solve and, it turns out, little software to actually support them.
Said another way, there is a long tail of very custom process problems that software is supposed to help businesses solve.
In the past, softwares long tail has been generally inaccessible because software has been
Too difficult to write
Too expensive to write and distribute
Too brittle or expensive to customize once deployed.
It just hasnt been economical for someone to create a custom software company to help architecture firms.
Thats why, in the software business, the traditional focus has been on dozens of markets of millions instead of millions of markets of dozens. The traditional software model is to make software have enough features and address enough of a homogeneous market that you can sell millions of copies of the same software. In the past, thats been the only way to make money.
Joe Kraus company, Jotspot, is one such ASP, with a focus around application wikis. Joe adds: JotSpot is a company that is building a platform to make it easy and affordable to build long-tail software applications. To take those Excel spreadsheets and turn them into real web-based applications where you dont have versionitis, where updates find you instead of you looking for them and where you can integrate data in your hard drive with data from the web, email and other applications.
Jotspot is just one example of an emerging category of companies which are offering software as a service for the long tail of enterprises the SMEs.
Tomorrow: Emerging Market Perspective
TECH TALK The Coming Age of ASPs+T