Software Industry Issues

1. Software Industry Issues Mark Lange Microsoft EMEA March 1, 2005

2. Agenda • Perspectives on regional associations • The software ecosystem • Trade liberalization • Market distortions • Industry response • Trusted computing • Interoperability

3. Regional Associations • The EICTA experience • European ICT Association • Composed of national associations and individual regional/global firms • Credible voice of industry in region • Challenges • Living up to expectations • Basic education about the industry, local markets, small businesses • Raising awareness about benefits to society

4. The Software Ecosystem Industry Intellectual Commons Customers Government

5. Software Ecosystem • The software ecosystem built on the work of governments, academic institutions, private research, commercial organizations and individuals. It represents a wide range of development, distribution and licensing practices. • Legal regime, IT skills, trade encourage the cycle of innovation that makes up the software ecosystem • History has shown that a healthy independent software industry creates: • More innovation • Ongoing improvements in price-performance for software, hardware, and services • Mass market that makes computing affordable for businesses and consumers • Greater productivity and economic growth

6. Trade Liberalization • Market access, national treatment • Key element of an enabling environment for software industry • Impact on competition, prices, IT usage, investment, productivity, exports, growth

7. “Shaping” the software market • Preferences for some software based on: • Nationality of supplier • Type of software • Other political factors • Often arising in context of government procurement policies • Preference policies reflect several legitimate government concerns (economic development, security, cost) • But preferences are not the answer for a sustainable ecosystem • Not consistent with policies of access, competition and equal treatment

8. Current example: Kenya • Current proposal: • Bias for national supplier • Bias for open source software • Impact: • “favors” distort the market, trade and investment incentives • National and foreign firms want predictability, nonintervention, and choices based on quality

9. Industry response • Policy positions supporting • competition on the merits • technology neutrality in government policy • interoperability and use of open standards • intellectual property protection

10. Industry response • Many trade associations have issued policy positions for technology neutrality • National IT associations in Belgium, Bulgaria, Denmark, Germany, Italy, Portugal, Spain, Sweden, UK • International Chamber of Commerce • Business Software Alliance • Initiative for Software Choice

11. Network Security • Microsoft efforts: Trustworthy Computing Initiative • integrate security solutions into all aspects of the computing environment (improving the process of developing/updating software, expanding security training for customers and partners, and developing new technologies to protect users from malicious attacks online) • global regulatory co-operation in fighting cybercrime • essential because information systems and communications are inherently trans-border in nature • successful only if there is cooperation among key stakeholders, including industry, government, users and law enforcement • network security initiatives must respect personal liberties and privacy

12. Customers Governments • Flexibility • Cost Reduction • Healthy IT ecosystem • Promoting choice, innovation • eGovernment initiatives • Social and Political issues Interoperability IT Industry • Technical business necessity • Reduce costs • Customer value Interoperability