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Selling Software is Blood Sport

Thursday, April 10, 2008
Selling Software is Blood Sport

The lawsuit between talent management vendors SuccessFactors and Softscape is just the latest example of the cutthroat competition raging in the independent packaged software business since it started in 1969.

By Bill Kutik

 

It all started in 1969 with what became known as "the consent decree."

Under considerable anti-trust pressure, IBM agreed to unbundle its software and services from its hardware, which had previously been sold at one combined price. Since IBM's application software was suddenly no longer "free," the decree gave birth to the independent packaged software industry.

It spawned such early mainframe software vendors as McCormick & Dodge, MSA and closer to home in HR, InSci (Information Sciences) and Tesseract. Plus, it began the blood sport of software sales.
snip

In 1991, Integral Systems sued its founder, Dave Duffield, four years after he left to start PeopleSoft and just as the new company was starting to pick up real sales momentum. Integral claimed Duffield could not have gotten to market so quickly without copying Integral's code and functionality in his new HRMS. That suit was settled out of court.

Now we are faced with the spectacle of SuccessFactors suing Softscape over the creation and e-mail distribution of a competitive document. I won't rehash the allegations in the case. Knowledge Infusion VP Jason Corsello has already done a fine job on his blogas has TechVentive CEO Brian Sommer on his blog.
snip

After reading many of the court documents, it appears that somehow the burden has shifted to Softscape to prove that it did not e-mail it. Now, everyone knows it is impossible to prove a negative. So I await a showing from SuccessFactors that "John Anonymous," the name on the Google e-mail account involved in the distribution, is somehow connected to Softscape. I understand Google has been issued a subpoena in an attempt to discover that.

However this lawsuit turns out (and many get settled out of court after the discovery process, which has just started), I'm sure it will not change the way the software industry has been selling for nearly 40 years.

HR Technology Columnist Bill Kutik is also co-chairman of the 11th Annual HR Technology Conference & Exposition® in Chicago, Oct. 15-17. The full agenda will be available in early May at http://www.HRTechnologyConference.com. He can be reached at bkutik@earthlink.net.


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