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FOR IMMEDIATE RELEASE

Backgrounder on Software Superdistribution

The Lotus Development - Frontline Systems agreement for distribution of the new Solver for 1-2-3 97 Edition is a real-world example of the emerging concept of superdistribution.

This concept, and the term "superdistribution" was advanced in 1987 by Ryoichi Mori, head of the Japan Electronics Industry Development Association. Mori recognized that the cost of duplicating and electronically distributing software was rapidly dropping towards zero. More significant, he pointed out that while it is very difficult to monitor whether software has been copied, it is easy to determine whether it is being used. He therefore proposed a business model in which software would be copied and distributed for free, but usage would be monitored and paid for.

Superdistribution Versus the "Web Store"

Superdistribution does not simply mean that software is electronically distributed, for example by downloading it over the Internet. Electronic software distributors such as Software.Net and similar "Web stores" are following the traditional model where:

The superdistribution model provides that:

Superdistribution Versus Shareware

The superdistribution model more closely resembles the "shareware" model than the traditional retail distribution model for software. The shareware model grew up in the world of online services such as bulletin boards, CompuServe and America Online. Shareware made it possible for companies such as DataStorm, makers of ProComm, to emerge despite the barriers to entry in retail distribution. More recently, this distribution model enabled Netscape to rise to prominence with its Navigator Web browser. The key advantage of shareware, besides the convenience of electronic distribution, is the ability for users to "try before they buy."

The key difference between superdistribution and shareware is the technical ability and business practice of monitoring and controlling usage of software. Most shareware comes in two forms: An "unregistered" version which periodically asks the user to register, and a "registered" version which contains the user's name and legally is licensed to that user, but physically can be copied and used on another PC by someone else.

Any software package can easily monitor the fact that it is being run, but in earlier years it was more difficult to determine the identity of the PC being used, and whether the software had been run before on this PC (if so, for how long or how many times). But in today's world, where every networked PC contains a unique ID (e.g. an Ethernet or IP address) as well as persistent system-level information such as the Windows Registry, it has become much more practical to monitor software usage. Frontline Systems' Solver for 1-2-3 97 Edition contains technology which can determine that a registered copy is being run on another user's PC, in which case it reverts back to unregistered, trial usage mode.

Superdistribution and "Phoning Home"

Superdistribution also relies on the ability to report software usage back to the original developers, as well as a means to collect and remit payment for usage. Shareware is often handicapped by registration and payment methods which are a nuisance for the user -- especially in comparison to the ease with which the unregistered version was obtained. There is often a considerable delay as a purchase is processed by mail or other means -- sometimes without the convenience of credit cards. And many shareware vendors are not organized or equipped to provide ongoing support, which is essential for software that is used in serious or mission-critical business applications.

The advent of the Internet has made it much easier to report software usage, collect and remit payment, and provide the user with the results (such as a permanent license or software registration). The Solver for 1-2-3 97 Edition contains technology which can "phone home" via the Internet, via a direct modem call, or via the user's phone call to an 800 number, a fax, or by regular mail. With the Internet and modem connections, the transaction is completed in seconds with no user intervention required (an unlocking code is transmitted back to the user's PC). A registration by phone, fax or mail is completed when the user enters a code received immediately by phone, or later by fax or mail.

Significance of the Lotus Development - Frontline Systems Agreement

There are already many specialized software packages which are being distributed in demo or trial form over the Internet or other means. But the Lotus - Frontline agreement for distribution of the Solver for 1-2-3 97 Edition may be the first case where a component of a major business productivity application, formerly developed in-house or "bundled" on an OEM basis, is being distributed in this fashion.

For Lotus, the move reflects a willingness to entrust responsibility for an integral spreadsheet component, both development and ongoing technical support, to Frontline Systems, an outside vendor -- and a belief that users will be happy with the superdistribution model which lets them try the Solver for free, and pay for it only if they use it.

For Frontline, the decision to rely on revenues from usage, rather than a fixed up-front OEM license fee, reflects a willingness to bear the risk of investing in development and ongoing support under the superdistribution model, as well as confidence that users who try the Solver for free will find it so valuable that they'll pay, not only for a registered copy of the basic 200-variable version, but for ongoing support as well as enhanced versions with more capacity and speed, as their applications demand it.

This agreement demonstrates that superdistribution is "coming of age." The consequence will likely be a breakdown of traditional barriers to software availability, an abundance of component software with "direct from the source" support for users, and the emergence of many new specialized players in the software marketplace.

For other explanations and viewpoints on superdistribution, see:

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For More Information Contact:

Frontline Systems Inc.
P.O. Box 4288, Incline Village, NV 89450
Tel: 702-831-0300
FAX: 702-831-0314
Internet: info@frontsys.com

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Copyright © 1996 Frontline Systems Inc.
Last modified: December 05, 1996