The Right Price Is Free

The newest model of software distribution is so compelling that it's changing the nature of software itself.

Need a web browser or email client? Forget navigating long rows of shrink-wrapped software at CompUSA. Get on the Net and download for free! It's the newest model of software distribution — a model so compelling that it's changing the nature of software itself.

William Headapohl, 42, and Matthew Barzun, 26, are defining and proliferating the new model. They are high-ranking executives at CNET Inc., responsible for its three software sites: shareware.com, download.com, and buydirect.com.

More and more software-hungry customers are visiting CNET and searching its vast archives. Shareware.com contains 250,000 different files, all available for free. Download.com is a browsable directory of 7,000 top-rated files, also free. Buydirect.com, the youngest of the sites, sells more than 100 Internet-related products including browsers, utilities, and multimedia plug-ins.

In an interview, Barzun and Headapohl describe how you'll shop for software in the future.

Try and Buy

MB: "Shareware" still has negative connotations. But if you forget the term and focus on the model, you realize shareware isn't just made by startups in garages anymore. Netscape's Navigator is shareware. Microsoft's Internet Explorer is freeware. It's really not about shareware or freeware. It's about "try and buy." Lots of customers aren't comfortable paying $100 for software they've never used. What better form of marketing is there than letting people sample your product before they buy it? That's the try-and-buy model, and it's the primary driver of our business.

WH: We're entering the next phase of the try-and-buy experience. Companies are developing "wrappers" for software that give people a certain number of days or uses before they have to pay: "We hope you've enjoyed our software. It will shut itself off in five days unless you pay x dollars."

Small and Fast

WH: Online distribution is also changing how software gets designed. Big applications like Microsoft Word are going to be broken into pieces so they can be downloaded more easily.

MB: Internet Explorer is a good example. Microsoft has produced several versions. There's the full install, the typical install, the minimal install. In a world of limited bandwidth, even freely downloadable software has a price — people's time. There's a real cost to downloading a 12 megabyte file as opposed to a 5 megabyte file.

More and Better

MB: Distributing software over the Web creates opportunities for companies that could never get retail shelf space. The Pilot organizer is incredibly hot right now; third-party developers are writing all kinds of applications. Can you imagine a little software vendor with a Pilot crossword puzzle getting shelf space at Egghead? They can get space on the Web. It creates a level playing field.

Closer and Tighter

WH: Distributing software over the Web has another benefit — it creates tighter links between a company and its customers. We provide instant user registration for any product downloaded from buydirect.com. A company learns immediately that "John Smith from Cleveland, Ohio just bought your software. Here's the serial number." The developer can put that information in a customer-support database, and start providing tech support in five minutes.

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