A Framework for Analyzing Software Business Models

Abstract

In this study we explore the concept of business model and its essential elements in software business. There are no rigorous previous definitions or descriptions of the term business model in the context of software businesses in existing academic literature. Hence, a conceptual definition was found essential. Furthermore, there is a clear managerial need for constructs that help understanding and managing the bounded variations of different aspects of software businesses. We believe that decomposition of the business model concept is of help on that score, too. Based on cases representing different businesses in software industry, we explore business models for creating of a holistic view of business options based on schemes of things that the managers of our case companies found essential when describing their businesses. As a result of our study, we combine product development, marketing, sales, revenue logic, services and implementation into a cohesive framework describing the generic elements of business models in the software industry.

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