The era of big software is over

But now with Web 2.0, SOA and web services, it may be true that "the era of big software is over."

Bill St. Arnaud (right, from his blog) meditated on this point at Dave Farber's list recently and it's a vital turning point for the industry.

Modules can be developed independently by small teams of open source developers. The same module can be re-used by many different applications.  The value no longer remains resident in the software but how you mash up these services together to create new innovative solutions.

It's this process, rather than the legalities of open source licenses and patents, which is the real, ongoing threat to Microsoft. Open source fits better into this world than proprietary software does. The visibility of open source code lets you see how modules will fit together.

Black Duck Software CEO Doug Levin has spent the week at a business conference in St. Petersburg, Russia, schmoozing CEOs from around the world, and he says they get this point.

"With open source, there’s a component utilization model which engineers and organizations are embarking on," he says. Companies are evaluating upgrades of big programs far more closely as a result.

When you're building solutions based on parts, you upgrade based on modules, or by combining modules. You're reluctant to change what sits below the modules because that impacts all the dependencies above. So you don't.

And that will kill Microsoft faster than any open source contract ever could.