From products to services: The software industry in the Internet era

The computer-services and software industry used to be conveniently divided into three main sectors: mass-market software vendors, enterprise software vendors, and computer services. The three sectors were distinct, because personal computers, corporate mainframes, and online computer networks operated in relative isolation. The arrival of the Internet effectively connected everything, facilitating the entry of mass-market vendors into enterprise software and of both mass-market and enterprise software vendors into computer services. As the turbulence of the first decade of the Internet era subsides, a gradual transition from traditional software products to "Web services" is taking place.