I could not attend Software 2005 due to a last minute change in program - This viewpoint is based on all published information available - Sand Hill sources, videos, presentations, transcripts, my conversation with MR after the event and a few participants and almost all related writings about the event.

Software 2005 is perhaps the best event of its kind to bring together the best in the industry and this time assumes greater significance given the significant shifts that the industry is in for - Consolidation, Open Source, SaaS, Offshoring & Quality issues with software.

The overwhelming set of opinion that came out of the Software 2005 event indicates:
- Getting budgets for new technology spending is becoming tougher and tougher as existing investments suck more and more resources for maintenance and enhancement.

- Opensource is not seeing the adoption as the publicity engine suggests and the so-called promise of Opensource is yet to show up.

- Customers have woken up to software quality issues and are beginning to demand more reliable enterprise applications.

- Big vendors are trying to push consolidation more and more - while the promise of small and niche vendors continue to be noticed.

- Internet's disruptive power is bringing to the fore, questions of real value add by analysts given the fact more and more information is beginning to be freely available. A new type of analyst firm based on a different business model needs to emerge.

- Funding and Investments are still happening big time in the industry - but innovation remains an open question.

- Initiatives to take technology more and more global shall continue to gain momentum.

- Offshoring is a business compulsion and thinking and discussions point to how to make more and more of offshoring.

- The CIO's believe that the software industry needs a fresh business model, better quality control, and closer product development ties with customers.
Some interesting perspectives, facts, thoughts and data that got aired:

- Open source software, enabled Unilever to set up shop in Iran, without violating U.S. technology restrictions. Neil Cameron, Unilever CIO pointed out opensource is just there as part of the agenda but not available across the stack hindering wide adoption. In enterprises, opensource create problems in maintenance and enhancements. Open source is "never free." It still must be supported and accommodate other "wraparound" technologies.

- BP is all for judicious use of opensource but it's just not where BP is focusing now. Technology investments are veering more towards solutions facilitating collaboration & visualization, fresh investments would go after solutions helping business grow better.

- Joseph Cleveland, Lockheed Martin CIO said his organization produces and maintains more lines of code than Microsoft, and the difference is that the products are mission critical. The challenge here is the outlandish dollar outflow to be spent to protect Lockheed's systems from viruses and hacker attacks. Allocating money for new investments becomes a big challenge when most resources go towards maintaining the existing software. In the CIO panel.all the CIO's said they are only in the early stages of evaluating or using open-source software technology. An interesting comment from Lockheed Martin saying security and reliability( the much talked about features in opensource) have to be found satisfactory before being tried within.

- Shane Robinson of HP has a slightly different take - mixed environments of commercial and open source software will prevail in enteprises. With 60 percent of companies having a mix of open source and commercial technologies, HP anticipates the persistence of this hybrid model, while clearly ruling out the possibility that customers will deploy all open source or all commercial software.

SpikeSource founder, Kim Polese outlined open source as a wedge, one that will drive open economies worldwide. She feels that we are entering Globalization 3.0, where individuals and small groups become empowered, and causing disruptive behavior. Globalization 3.0 pushes economies to take a bottom-up approach, instead of being driven from the top down by a few powerful industries and she sees the behavior is reflected in the software industry, where the dominance of a small handful of companies has been challenged by the open source movement.

- Discretionary and trial budgets are becoming less and less and CIO are looking for more and more value are getting very choosy and highly selective. BP confirmed the general phenomenon of very limited dollars being made available for new investments pretty much confirming to global average of 70% of budget going for maintenance and less than 30% going in for new technology acquisitions.

- Software companies taking protection under warranty provisions minimizing potential liabilities for software flaws are coming in for severe fire. Software quality and support are becoming top concerns for the CIOs.

- CIOs are beginning to get asked by the business about BVIT & ROI as so much resources get sucked by IT The software security issues are consuming too much time and money and vendors are being asked about this. A variable model(thought to be more apt for consulting) has been floated for discussions where software product companies could be paid based on business outcomes.

- Charles Phillips tried to position Oracle as the pre-eminent enterprise software vendor. He sees Oracle as having critical mass in applications, middle-tier software, and databases. Charles highlights scope for application standardization by pointing out:

- Although the old battles such as TCP versus token ring and the use of JDBC drivers are over, java based stacks are becoming the , de facto standard for applications while admitting Oracle is still in midstream in the conversion over to Java for its applications. In addition, the industry is in the midst of standardizing on the expression of APIs with XML, standardizing on Web services, and designing component-based architectures.

- Beyond standardization, the next big move in the industry is toward vertical packaged applications rather than horizontal applications.

-The third major direction of the software industry is its move from being process driven to cross-process driven. Companies realize if they had the same data model across processes the quality of the information would be much higher. As Oracle owns so much of the stack, applications, middleware, and the database, it will intensify its efforts to create best practices around configurations that it will also certify.

- Sarbanes - Oxley came in for severe criticism in the CEO panel consisting of Jim Cashman of Ansys, Mike Greenough of SSA Global, Amnon Landan of Mercury Interactive, and Bernard Liautaud of Business Objects. The criticisms rightfully so, ranged from "The biggest waste of time and effort ever invented in the history of mankind,"to "Really stupid". Business Objects' Liautaud, speculated that Sarbanes-Oxley may have cost the country two percentage points of profitability last year. No wonder as several CIO's struggled in not being able to define a budget for enforcing SOX compliance.

- Roger McNamee highlighted the New Normal phenomenon as seen in the ubiquity of the now-indispensable devices such as cellphones and Blackberrys. Moore's law, Berlin Wall created new opportunities for most and challenges for a few making some of them to take on new tasks and in general pushed doing more work with fewer people. This has made these employees more indispensable and afforded them new, marketable skills. His logic for future optimism: As the economy rises, the employees have more leverage.

- Efforts to get information technology into the hands of people in third world nations are a huge cultural imperative and a significant business opportunity. Negroponte is convinced that laptops are preferable for educational efforts and he believes the fearless relationship - children tend to have with technology makes it unnecessary to provide culturally contextual content out of the gate - just give a child connectivity and a computer. That gets them 70% of the way there.

The SaaS proponents attending in good numbers showcased products and free ideas and in general the challenges of SaaS have to be able to:

- Bring to focus rapid rampup of customers, achieving threshold stability to get positive on the revenue flow and predictable revenue model is the key challenge.
- Get more and more targeted solutions and demonstrable ROI models
- Work on new partner & sales relationships and models
- Winning customers mindshare and walletshare, modularizing , process and vertical focus become the key to success.

M.R's view that in five years, we'll look back and we're not going to recognize the software industry that existed looks quite likely to happen. The industry is centered on paradigms outdated that presupposes customers won't relate to the mechanisms of software and specialists would bring forth expertise and business applications engineer competitive advantages capable of getting premium prices and it is an acceptable notion that industry can go through high and lows without any big /fundamental structural changes. In reality software invades all aspects of personal and business life- so much so that appreciation of commoners and business executives in differentiating between good value and poor value applications become so self telling - clearly across the spectrum customers are beginning to demand far more value than what the industry is offering.

S. Sadagopan, heads consulting and eBusiness for Satyam in the Asia Pacific and African markets based out of Singapore. He has led several consulting and technology transformation engagements covering multiple industries cutting across wide variety of technologies around the world. Sadagopan's blog is also theindiblog award winner of the technology category in the recently concluded indibloggies contest for 2004.