With more businesses and consumers growing accustomed to shopping on the Internet, the worldwide market for software purchased online will be worth $US3.5 billion in 1999 and is expected to reach $US32.9 billion by 2003, according to an International Data Corporation (IDC) report.
The market is being driven by a surge in the number of electronic retailers with more sophisticated customer tracking and product management techniques and by the continued growth in the number of Internet users.
According to the IDC report, users would like software vendors to pass on the cost savings inherent in selling their products over the Internet by lowering their costs and offering them tools to manage their electronic licences.
Users fear the loss of a paper trail, although they do want vendors to electronically deliver them the licences, said Steve McHale, research director of IDC's Software Channel and Alliance Strategies program in Toronto.
Currently, vendors expect that electronically shipping licences to users will reduce costs, speed the process and provide more data about how their customers acquire and use software. While users want lower prices, they don't want to have to provide vendors with too much information about their software usage, added McHale.