What is an AI editor?
The world of software publishing
Definition of a software publisher
- A software publisher can be defined as a company whose activity is to design and then distribute one or more software for a given market. Sometimes, he also wears the hat of software integrator, dispatching consultants to his clients to deploy the tool.
- The software integrator is specialized in setting up one or more tools for end users. It is very important to understand that an integrator is NOT necessarily a publisher, and is therefore not always the designer of the program. Indeed, some companies specialize in the implementation of certain solutions, relying on affiliate programs offered by publishers to generate profits.
- ESNs (Digital Services Companies) or SSIIs (Computer Engineering Services Companies ) have different approaches. Some specialize in creating custom software for unique clients, while others have outsourced consultants to their clients.
Typology of software publishers in France
Despite its relative youth, the profession of software publisher has developed very quickly around the globe, and particularly in France, which is now home to a very large pool of publishers. In order to see more clearly, some filters can be applied.
MAJOR INTERNATIONAL GROUPS
This first category brings together the largest French software publishers, now established almost everywhere on the planet and enjoying an international reputation.
Among them, we can cite Dassault Systèmes (the most important French publisher), Cegid or Ubisoft. Some foreign publishers have also developed a strong presence on French soil; this is notably the case of QAD, Only Office or Open Bee.
This type of business often relies on a myriad of software to support its growth , or at least on application variants that meet certain specific business needs.
HISTORICAL VSES-SMES
Historical software publishers with VSE or SME status often have a very strong presence in France , due to their seniority.
Their market is national, but it is not uncommon for publishers to extend their coverage beyond French borders. In this category of editors, we can find Divalto, Siveco, Kentika or ALPHA-3i.
START-UP
Finally, let’s look at new entrants or “start-ups”. These software publishers are often young (less than 5 years old) and generally offer a disruptive solution in an experimental context. Successful start-ups are also characterized by big growth and sometimes fundraising. Datategy, Gammasoft or DAMAaaS are good examples to mention here.
The place of French software publishers on the international level
French software publishers are mainly positioned on the national level , tackling a foreign market head-on being a complex undertaking. However, software lends itself well to internationalization, due to its intangible nature.
Furthermore, websites greatly facilitate expansion beyond the national circle. Thus, many software publishers have an international presence, whether by opportunity (signature with a foreign client) or as part of a strategy, generally through a network of distributors-integrators. Moreover, France has several very influential software publishers internationally.
Dassault Systèmes, the leading French publisher, currently has 178 offices spread over 6 continents, and generated annual revenue in 2019 exceeding the 4 billion euro mark.
Although it is overwhelmingly B2B oriented, the software publishing ecosystem in France also has some big names on the B2C side. The most important of these is Ubisoft, a video game publisher. With a turnover in 2019 of more than 2 billion euros , the company is firmly established internationally with more than 60 offices on 5 continents.
The classification of software publishers
Cloud VS On-Premise: fundamental differences
Currently, software (and therefore by extension publishers) can be classified according to their technical base: On-Premise or Cloud.
ON-PREMISE SOFTWARE PUBLISHERS
Before the appearance and democratization of the Cloud, on-premise publishers reigned supreme. An on-premise publisher works by deploying its software directly on the internal servers of client companies , then installing the licenses on all the workstations concerned. Accessible with or without an Internet connection most of the time, they can only be used from computers with a license.
CLOUD SOFTWARE VENDORS
But from 2001, the concept of the Cloud became more democratic and revolutionized the world of software publishing in a few years: SaaS solutions were born. In this case, publishers offer delocalized software (called Cloud, SaaS or on-demand) accessible remotely from most devices, with a simple Internet connection.
Sale or subscription? Two distinct business models
Historically, software licenses were sold at once . But the explosion of the Cloud very quickly changed the game by bringing a second economic model: the subscription.
Concretely, on-premise tools are most often sold to customers in the form of software licenses valid for life or for a limited period.
For their part, SaaS software is mostly offered in the form of monthly or annual subscriptions , with several prices available depending on the functionalities and/or the level of support. When a customer stops paying the subscription, he loses access to the service and can therefore no longer use it.
Financially speaking, the sale of licenses constitutes a significant initial cost for companies, but proves to be more advantageous in the long term. The subscription limits the initial investment, although sometimes less attractive in the long term, the payments being made at regular intervals.
Proprietary publisher and open source publisher: what are the differences?
Beyond on-premise & Cloud considerations, the question of the “proprietary” or “open source” approach also comes into play.
Proprietary software is in fact developed in a closed circle by the publisher , who is the exclusive owner. He is therefore the only one who can modify the source code of the application and propose updates. Support for this type of software is provided by the publisher itself, or by the network of integrator partners.
On the contrary, open source software is developed in a community approach and has a source code accessible to all. It can therefore be modified at will, provided you have the necessary technical skills. For this reason, it is common to find different software based on the same architecture, but largely modified.
Support is mostly available on community platforms, although partner integrators can also fulfill this role.
In practice, no solution is strictly better than the other. A publisher therefore makes an initial choice based on its values and business model.
Horizontal software vendor VS vertical software vendor: one objective, two approaches
Used to differentiate publishers according to their positioning, the terms “horizontal” and “vertical” refer to the following definitions:
- A horizontal publisher has a generalist approach , and develops software that can cover a large number of areas. These tools are generally very flexible, but do not have the same adaptability as their specialized counterparts.
- Next is the vertical or specialized editor . Its activity generally revolves around a specific sector of activity , for which it develops one or more dedicated tools. This “niche” software has a more restricted scope of use, but responds better to the sectoral challenges of companies.
Software publisher, a rapidly changing profession
A transformation of the product itself
The software offered on the market must evolve frequently and quickly to avoid sinking into oblivion. Publishers therefore regularly work on updates for their products in order to retain their full potential. But the change is also felt upstream, from the R&D phase. Thanks to regular technological advances, new opportunities are appearing : AI, Big data, more advanced algorithms, etc.
But software does not only evolve in terms of functionalities. Regulations have also tightened over the years , and have forced publishers to review their copies in depth. In Europe, the best example of this change is the entry into force of the GDPR in 2018. To comply with these new requirements in terms of personal data protection, publishers have had to adapt their tools quickly or risk finding themselves in the ‘illegality.
Another major development in software is the appearance and democratization of the principle of low-code / no-code . Previously, software was designed directly for businesses, with no real possibilities for adaptation. From now on, the low-code widens the field of possibilities by offering users the possibility of adapting the product to their daily uses. No more rigid tools, make way for agile solutions!
Changing financial needs
The days of developers in their garage are over! Today, software publishing companies can no longer be managed by a few people. They must therefore operate a rapid rise in size. In addition, the increase in development costs is also to be taken into consideration.
Software publishers must therefore quickly find sufficient funds to sustain their activity , or simply survive in times of crisis. Among the most frequent solutions, we find fundraising (which can reach several tens of millions of euros), or aid released by the government and public administration (BPI, France Export, France Relance, etc.).
Human Resources at the heart of change
In terms of human resources, needs are also changing! At the forefront of problems for software publishers, we find the lack of developers : difficulty in recruiting, high salary expectations…
To attract new talent (in programming, but not only), software publishers must therefore have their employer brand . This strategy consists of optimizing the company’s reputation and developing its attractiveness, whether internally or externally.
Software publishers also have to deal with a second HR challenge: the creation of a marketing & sales department (or the outsourcing of the latter) to develop their visibility. In France, priority is often given to technical teams. However, the publishers that are developing the most (in the United States in particular, but also in Europe), are those capable of investing as much in the marketing, communication and sales aspects as in the technical ones. The solution often involves the use of additional external skills such as those provided by the Gtec firm.
Multiplying targets
Mainly made up of CIOs until the early 2000s, the software publishers market then began a profound transformation.
Little by little, new functions have emerged: innovation, digital transformation… Today, these decision-making professions are in first place in a market long dominated by CIOs.
Such a change is not trivial, and forces publishers to review their offers to adapt to new personae.
A business model sometimes in need of renewal
Some publishers struggle to make their business profitable because of an obsolete or unsuitable business model. To get out of this situation, several areas of reflection can be worked on by publishers:
- On-premises or Cloud (SaaS)?
- Sole vendor business or integration services? Transition to ESN status?
- Pricing methods (free trial, demonstrations, freemium, “satisfied or refunded” guarantee, decreasing rates, etc.)?
- Consideration of new key partners? Development of customer relations (personalized support, quality of support, satisfaction surveys, recommendations, etc.)?
