1. Describe the trend that views software as a service rather than a product. What effect has this trend had on software acquisition options?
Web-Based software trends have rocketed Application Service Providers (ASP), and firms offering Internet Business Services (IBS) to a prominence in the software industry that believes in software as a service instead of a product. With the popularity and advantages of the Internet, companies are viewing this trend as an option to standard software development and acquisition.
Instead of buying a software application from a software company, producing it in-house, or hiring a consultant or outside resource to produce a software package these web-based firms have provided a new alternative based on three separate models. These models are a fixed fee model, subscription model or usage model. Fixed fee does exactly that, provides a fixed fee or cost based on a service level required by the user. The subscription model varies cost based on number of users and workstations accessing the application. The usage model charges fees based on the transaction volume or number of operations performed by the applications.
2. Explain the difference between horizontal application software and vertical application software.
Horizontal applications differ from vertical applications in that they provide a solution for many companies based on a common need. Applications such as accounting, payroll, inventory, and office integration packages are horizontal applications.
Vertical applications are those written for a specific industry or market. Examples such as a healthcare system for a hospital, claim processing for an insurance company are vertical applications.
3. What is the most common reason for a company to choose to develop its own information system?
The most common reason for a company to develop its own information system is that it needs to satisfy unique business