SandHill.com | Management | 10 New Opportunities for Software Vendors

SandHill.com | Management | 10 New Opportunities for Software Vendors: "OPINION
10 New Opportunities for Software Vendors
The confluence of new technologies, emerging business models and globalization leads to big business prospects for software companies.
Romesh Wadhwani, Symphony Technology Group
Aug 12, 05
We are in an industry that is having trouble coming to grips with reality.

Software companies thought for a long time that our industry could defy gravity and experience double-digit revenue growth forever.

The truth is that our customers no longer value cutting-edge technology over business results. Our investors no longer value growth over profit. Our employees no longer value options over stability. We are in an industry that needs to make dramatic changes to reinvent itself over the next decade.

When I gave this presentation at Enterprise 2005, I asked the 100-plus software CEOs assembled if they felt their company's best opportunity would be to be acquired by Oracle. No one raised their hand. Then I asked who wanted to leave their software company to run an auto supply business because that industry has more upside? Only a few hands went up.

To me, those responses mean there is still a tremendous amount of hope in the industry. There are exciting new developments - in technology and business practices - that will lead to significant new market opportunities in the next few years. Here are ten trends which will lead to those possibilities.

1) Consolidate or Be Consolidated
There is a perception in the industry that 'Darwin's Law' applies: You must acquire or be acquired. This isn't quite the case. Oracle is almost done with its acquisition frenzy. The high valuations they caused are not going to apply to most other vendors.

If you want to be the acquirer, you need acqui"