Thirty years ago, before the dawn of the PC age, software was already a big business. Most of it was written for mainframes and minicomputers. Software vendors, including the computer companies, contracted with the corporations that owned this “big iron” to create or customize programs for their business needs. The general public was blissfully unaware of what software was and how it worked, and few understood the difference between software and hardware.

Now that most people use PCs, they know what software is and does. They may use a word processing or spreadsheet program at work, a genealogy or personal finance package at home, and an e-mail program and Web browser everywhere. There is a software program to enhance every aspect of modern life.

Packaged or “shrink-wrapped” programs such as games, word processors, or video editing suites are the most important products in today's consumer software market. But there is a big market for business applications, most of which are customized adaptations of commercial software products. Banks, airlines, government institutions, customer service organizations – they all rely on software to run their business processes, record orders, track activities, and more.