Philip Greenspun, responding to an UberNerd friend who believes that “if you don’t have a patent you can’t make any money,” observes:
Checking the top 10 out of the Fortune 500 companies, for example, we find Walmart right on top, followed by Exxon Mobil. Except for IBM none of the companies feels like one based on intellectual property and even IBM these days gets most of its revenue from service. Certainly it is tough to see how an insurance company such as AIG (#10) and a bank such as Citigroup (#8) are living large from patents.
I was reminded of a posting from Karsten M. Self on the Free Software Business email list almost three years ago. He observed that…
From an industry list of the top 100 computer companies by sales for 1998 (latest numbers I’ve got), there is only one pure-play software company in the top ten, it’s ranked number ten, and that’s Microsoft. You have to drop to number 56 to find another (Novell), then 63 (Adobe). The other companies are largely a mix of HW + services (e.g.: IBM) or SW + services (e.g.: Oracle)….
[Out of the firms in Software Magazine’s “Software 500” that list no revenue from services,] the following note software revenues as the bulk of all revenues: Microsoft ($21,591 [million]), SAS ($1,020), Adobe ($1,015), Autodesk ($820), and Symantec ($728). I’m excluding consulting firms (e.g.: PW-Coopers, Andersen) whose “software” revenues are largely associated with consulting services. SAS’s reported financials exclude service revenues. Only two of these firms (other than Microsoft) could be considered to have a significant desktop presence: Adobe and Autodesk. The delta between them and Microsoft is 20 to one.
So, of the top fifty “software” firms, there are four which derive the bulk of their revenues from software itself, for a total software revenue contribution of $25.1 billion, 86% of software revenues from software firms comes from Microsoft itself.
As far as Internet Time goes, three years is an eon, but I suspect that anyone looking at current figures would see a similar breakdown.