Software Industry Overview of Global Marketing Channels

1949 Words Mar 19th, 2011 8 Pages
I Software industry overview of global marketing channels

1. Overview of the software industry

The software industry is the most important and one of the most rapidly growing segment of the information and communication technology (ICT) industries. According to DataMonitor, the size of the worldwide software industry in 2008 was US$ 303.8 billion, an increase of 6.5% compared to 2007. The United States is estimated to have approximately 50% of the global software market 's value. U.S. software companies lead the world in development and production of softwares for business, homes, and schools. DataMonitor forecasts that in 2013, the global software market will have a value of US$ 457 billion, an increase of almost 50% since 2008.
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So in addition to the traditional modes of supply (across-the-border trade, bundled in hardware, trade through commercial presence), software products can now be converted into bits and shipped directly over the Internet.

Distribution Model for ESD

In some ways, electronic software distribution is the same as conventional physical delivery models. For one, the publisher, distributor and reseller all work together to provide end users with software and customer service, while protecting the publisher’s intellectual property and sales. However, the roles and responsibilities of traditional channel partners are not identical in the online world. ESD and electronic commerce have opened the door for new players and nontraditional roles.
There are three commonly used distribution models: • Direct Distribution = Publisher – End User
In direct distribution, publishers benefit by controlling the process of delivery to the end user. Furthermore, publishers build direct relationships with their customer base. Drawbacks for the direct model for publishers include the time required to manage the process and the difficulty of achieving the maximum number of distribution points for their products. • Single-Tier Distribution = Publisher – Reseller – End User
Single-tier distribution was the most common model used at the onset of Internet-based ESD growth. The first ESD players in the industry considered themselves online resellers and
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