Custom Software and EDP Services

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• In the next phase, companies developed to provide common types of software, adapted to a particular customer.
  • Custom software.
  • In Japan, "systems integrator" companies.
• Other companies bought computers, developed software, and sold electronic data processing (EDP) services.
  • Payroll accounting was common because much of the complexity was due to government regulation. Thus the EDP company could build up expertise relevant to many clients.
• Less sharing, but no special intellectual property protection.
  • Not needed for custom software. Only one company can use it, they already have a relationship to the vendor.
  • Nor for EDP. The EDP company is writing its own software, and uses contracts with the employees to prevent leaks and defections, called non-disclosure agreements and non-competition agreements.

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