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5 of 5 people found the following review helpful:
5.0 out of 5 stars
A Fascinating Look At The Evolution Of The Software Business, June 29, 2003
I wasnt sure how I would like Martin Campbell-Kellys new book since I have grown up with the software industry--I started as a programmer in 1973and thought I had a pretty good understanding of it. But on the contrary I found his book fascinating. Over all I thought Campbell-Kelly weaved together many hard-to-find facts and statistics into a comprehensive, well-researched, and well-written story of how the software industry evolvedBasically, it reviews the development of the various software industry segments; what we now refer to as professional services companies, enterprise product software companies, personal computer software companies and game companies. For each, it describes the major events that created these industry segmentse.g. in 1970 IBM unbundled its software pricing from its hardware pricing ushering in age of product software companies; the major companies who dominated these segments; and the business models. A few things that were of particular interest to me. When I grew up in the software business, we used lines of code as a way to estimate the work it would take to create an application. I have overseen the development of systems with millions of lines of code. So I was surprised to learn how few lines of code were in DOS 2.0, just 20,000+, and even more surprised to learn that the venerable early business language Fortran, in its first incarnation, was only 18,000 lines of code. And it helped put into context what I have lived through. For example, in 1973, straight out of C.C.N.Y., I first entered the job market as young Cobol programmer trainee at Royal-Insurance Company in New York. As a youngster I had no awareness that Thomas Watson Jr. bet his business on the IBM360, or that it was the reason for IBMs unprecedented industry dominance. I just knew that I worked on IBM 370-145, an updated, at that time, version of the IBM 360. And does this sound familiar? Never before has the stock market shown quite so much enthusiasm about an industry as it has lately about the computer industry. Recent prices of computer stocks represent some of the highest prices-earning ratios ever recorded. Even shares of giant I.B.M, which increased six fold between 1957 and late 1966, have doubled since. In July the market valued I.B.M., whose physical assets amount to less than $6 billion , at more than $40 billionmore than any other company in the word, actually as much as gross national product of Italy. And the market value of smaller and newer companies in the industry has gone up even more steeply than I.B.M.s. In less than three years the price of University Computing Co. of Dallas rose form $1.50 a share(adjusted for splits) to $155. The stock market valued this newcomers, who sales last year were than $17 million, at more than $600 million. This quote that Cambell-Kelly provides is about the timeframe 1964-1968, which was another time period of irrational exuberance, like our recent dot.com debacle. Only I hope that our recovery will be sooner than that one. It evidently, took almost ten years for the market to again buy software company stock. I do have one quibble, though. Campbelly-Kelly challenges the common perception that Microsoft dominates the technology industry. He quite correctly cites statistics which show that, even if Microsoft is a giant, IBM is a titan, towering over Microsoft; where Microsoft has at most owned 10% of the software industry, IBM owned fully 75% of the entire IT industry consisting of computer hardware, software and services. To put this into perspective, the total of computer hardware, software and services revenues world-wide today is thought to be something like $1 trillion. If IBM had maintained its earlier level of control it would now be worth $750 billion while Microsoft today has revenues of roughly $28 billion. His point is that while IBM was almost the entire industry by itself, Microsoft controls just a piece of the software industry. While this is true, I dont believe the issue of Microsofts dominance is about revenues. I believe it is about cultural impact--which Campbell-Kelly does allude to. Microsoft, almost single-handed, created a cultural revolution, making it fashionable to be a nerd, to dress casually in business, to work insane hours, to believe as a young twenty-something you can be an over-night millionaire. Whereas IBM made an impact on businesses--certainly being viewed for a long time as one of, if not, the best-run business on the planet--Bill Gates and company, captured the publics imagination and changed our society in a way IBM never did. And why not, when Bill Gates and Paul Allen are the first and third richest men in the world. All in all though, this book was an enjoyable and insightful read.
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