Standardization and the Competition on the Market for ERP-Systems Bernd Reitwiesner and Stefan Volkert Although frameworks appear to be a promising means to provide the industry with business management software, one cannot observe that framework vendors begin to threat the market position of vendors of established standard software. We build a microeconomic model to analyze the competition of software development with or without frameworks in which we concentrate on the network effect and the effect of compatibility decisions. We can show how the introduction of a standard will help to establish framework technology on the software market and finally increase social welfare. Therefore we recommend the standardization organizations to support framework technology by establishing standards. Introduction The m a r k e t for enterprise w i d e resource p l a n n i n g systems (ERP systems) is currently d o m i n a t e d by large software c o m p a n i e s . A p a r t f r o m b e i n g the vision of a n e w p a r a d i g m for the efficient c o n s t r u c t i o n of flexible a n d ext e n d a b l e b u s i n e s s a p p l i c a t i o n s , the c o m p o n e n t b a s e d a p p r o a c h to softw a r e d e v e l o p m e n t h a s also a l w a y s b e e n c o n s i d e r e d as a c h a n c e for t h e smaller software c o m p a n i e s to successfully e n t e r this (nearly) closed m a r ket. But reality d o e s n o t yet c o m p l y w i t h that hope. Still, s t a n d a r d software based solutions, especially SAP's R / 3 system, d o m i n a t e the m a r k e t for ERP systems, thereby p r o v o k i n g the well k n o w n negative c o n s e q u e n c e s of s u c h a d e p e n d e n c y of large parts of the e c o n o m y on " o n e single" s o f t w a r e v e n dor. S o m e r e s e a r c h on f r a m e w o r k t e c h n o l o g y h a s b e e n d o n e a n d is still Dr. Bernd Reitwiesner is research fellow and lecturer at the University of Augsburg. He works at the D e p a r t m e n t of Business Administration, Information Systems a n d Financial Engineering. He has a graduate degree in Business Administration a n d C o m p u t e r Science. His interests include e-finance, asset m a n a g e m e n t and standardization of information systems. Stefan Volkert is also research fellow and lecturer in the same Department and also has a graduate degree in Business Administration a n d C o m p u t e r Science. His interests include electronic c u s t o m e r relationship m a n a g e m e n t a n d stand a r d i z a t i o n of i n f o r m a t i o n systems. They m a y be r e a c h e d at < b e r n d . r e i t w i e s n e r @ w i s o . u n i augsburg.de> and .

Knowledge, Technology, & Policy, Summer 2001, Vol. 14, No. 2, pp. 31-40.

32

Knowledge, Technology, & Policy / Summer 2001

under way. Most IT-related research deals with framework technology compared to standard and individually built software from a p u r e technical view thereby discussing integration, software-reuse, interfaces, multi-tier software architectures mostly on a qualitative basis (Ivanov, 1996, Philippow, 1998, Anleitner, 2000, Schmitzer, 2000, Turowski, 2001). Other research partly supporting our theses describes and explains what can be observed on software markets by empirical surveys (Dietzsch, 2001). By analyzing the software market for ERP systems one can see that the so far missing--substantial success of the framework technology is not so much a matter of technological issues but merely a question of economic and political matters like market share, market entry barriers, standardization and others. Therefore in this paper we want to pursue the question of success of the framework technology by a microeconomic approach. Before we can go into a detailed analysis of the competition, we have to describe the difference between the two approaches dealt with in our paper to provide ERP systems. Standard software, as we see it in our paper is business software "not produced for a single customer but for a lot of customers needing the same type of IT-support" (Mertens, 2000). The major feature of this type of software is the facility to be customized to the specific needs without changing the source code, but by adjusting an extensive set of predefined parameters. Component-based software or component ware means a concept of developing application systems in which the software is neither p r o d u c e d individually for one system nor it is relying on just one piece of standard software. A component is a piece of software engineered for reuse. In order to deploy components an infrastructure is n e e d e d w h i c h coordinates the single components thereby fitting them together, called framework. In a broader sense the notion framework stands for a set of methods aiming to enhance the productivity of software dev elo p men t by means of reuse. In our paper we concentrate on domain-specific frameworks, which support the development of applications in a certain problem domain. Apart from the technical and development problems mentioned above, there are some particularities w hi c h have a great impact on the relative market positions of the competing technologies. They are related to the ne t work effect, being a positive externality, w h ich causes the utility of a consumer of a certain product to increase with the n u m b e r of other users of the same product. N e t w o r k effects play an important role in software markets and may result from different causes. Firstly for standard software, a potential ne w user of a standard resource planning system will trust the processes implemented in the software the more other companies are already using the same product of a certain vendor. Secondly, in addition to such more psychological effects, network effects may result from the need of interoperability, e.g. if two companies want to cooperate in a business network to form a virtual organization their information systems need to support inter-organizational business processes. And thirdly, the n u m b e r of components available fitting into a specific framework will increase with the number of users of the same framework.

Reitwiesner and Volkert

33

If two different types of standard software, two different types of frameworks or a framework and a standard software are able to interoperate or if one of them is able to call the functionality of the other, we call them compatible. 1 One product can profit from the network effects of another product, if it is partially or fully compatible. Standardization, if a standard is accepted by the majority of market players, allows the different products available in a domain to be equally compatible to each other. But w e can look at it also the other way round: the need for compatibility may lead to the emergence of a standard either as a proprietary de-facto-standard or as a true standard by undergoing a formal standardization process. Thus compatibility or standardization decisions have a great impact onto the competition in software markets. The Competition between Software Solutions based o n F r a m e w o r k s or S t a n d a r d S o f t w a r e

By means of customization through parameterization standard software vendors promise to offer solutions fitting the individual business needs of the user. But these customization facilities usually will not allow standard software solutions to fit exactly to the customers' requirements, because customization often goes along with the adoption of the users' business processes to the reference processes supported by the standard software, but not vice versa. On the contrary, framework based solutions allow for business applications being as individual as individually developed software (Schmitzer 2000, p. 10) by means of adoption and extension of available or insertion of additional components. If one takes into account that, for example a typical application de ve lo p ed using IBM's San Francisco Framework consists to a degree of 40 percent of the f r a m e w o r k an d its related components, which are completed by an individual user interface, country and industry specifics, business rules and individual components (Scheer 1998, p. 116), it is obvious that a framework based application can be considered to be exactly matching the user's needs. Although the process of adaptation of the software to individual needs is by far simpler with standard software, it is not necessarily cheaper to deploy standard software than framework based solutions. This is due to the fact that in enterprise w i d e i m p l e m e n t a t i o n projects of s t a n d a r d software the m e r e customization is only one of the necessary project activities. Independently from the chosen technology, in every ERP implementation project the phases business modeling, requirements engineering, analysis and test are required. Furthermore, the costs for the redesign of the established business processes to be compatible with the implemented reference processes of the standard solution must not be left out of consideration. In our analysis of the competition b e t w e e n the two technologies, we have to abstract from the technical details and problems linked to framework technology and reduce our analysis to the factors d e t e r m i n i n g the market position in the market for ERP systems: firstly, the degree to which a standard solution meets the business requirements of a user. Secondly,

34

Knowledge, Technology, & Policy / Summer 2001

the n u m b e r of users a l r e a d y h a v i n g installed a s o f t w a r e of a certain type a n d the impact of the size of this installed base on the utility of the users, usually d e n o t e d as network effect. A n d thirdly, compatibility a n d / o r standardization decisions. We capture these factors in a market model (the m o d e l is based on Pf~ihler, 1998) for w h i c h the a s s u m p t i o n s a n d exact m a t h e m a t i c a l expressions are a p p e n d e d at the e n d of our paper. We a s s u m e the c o m p e t i t i o n to occur b e t w e e n two suppliers S a n d F, both offering a c o m p l e t e e n t e r p r i s e resource planning system. S provides its solution as a s t a n d a r d software, F is p r o v i d i n g solutions based on a f r a m e w o r k and the related necessary components. We describe an oligopolistic competition w h i c h takes place in two stages (see (A10)). The n u m b e r of participants can be r e d u c e d to two without loss of generality.

Results of the Price C o m p e t i t i o n w i t h g i v e n C o m p a t i b i l i t y Let us assume for the m o m e n t , that both v e n d o r s accept their d e g r e e of compatibility as given. The strategic variable left on the second stage is the price of their product. W h e n analyzing the i n d i v i d u a l profit functions (15), there are two relevant questions: (a) Is the profit greater than zero? (b) Which competitor makes more profit? In a n s w e r to question (a) w e can s h o w that prices t u r n out to be greater than the m a r g i n a l costs c, as long as the m a r k e t shares are greater t h a n zero. The m a r k e t shares are a l w a y s greater t h a n zero b e c a u s e of a s s u m p tion (A6). Thus both c o m p e t i t o r s can gain a c o n t r i b u t i o n m a r g i n greater than zero and therefore gain profits greater than zero as long as the fixed costs FC are sufficiently small. The a n s w e r to question (b) d e p e n d s ver~ m u c h on the set of parameters. The condition for ~ to be greater t h a n / r s can be w r i t t e n as:

~F > ~sB

(

1

2aad+ss_l)>O

(1)

6A 3 We can state that the profit of the f r a m e w o r k v e n d o r will s u r m o u n t the profit of the s t a n d a r d software v e n d o r in case of a small intensity of competition and small network advantages of the standard software over framew o r k s (which e.g. can be r e a c h e d by a large sE). H e n c e , w e can p o i n t out that for typical scenarios, w h e r e the n u m b e r of software installations of S s u c c e e d s those of F to a great deal, it is n e c e s s a r y for a success of framew o r k based software to be sufficiently compatible. Introducing a Standard into the C o m p e t i t i o n We have already seen, that d u e to the n e t w o r k effects, for some settings a h i g h d e g r e e of compatibility m a y be a d v a n t a g e o u s for f r a m e w o r k ven-

Reitwiesner and Volkert

35

dors. But w e h a v e to bear in m i n d that, in case of software t e c h n o l o g y , a profit maximizing degree of compatibility usually cannot be r e a c h e d without a g r e e m e n t of the v e n d o r of the p r o d u c t o n e w a n t s to be c o m p a t ible to. T h i s is t r u e m a i n l y for t w o r e a s o n s . T h e first r e a s o n is t e c h n o l o g i c a l l y o r i e n t e d : to be c o m p a t i b l e , in o u r setting, m e a n s to be able to use f u n c t i o n a l i t y p r o v i d e d b y s o m e o t h e r p i e c e of s o f t w a r e . T h e r e f o r e , one has to k n o w the d e t a i l e d s p e c i f i c a t i o n of the a p p l i c a tion p r o g r a m m i n g interfaces (API's) a n d is d e p e n d e n t on t h e i r p u b l i cation. 2 The second reason is of legal nature: in m o s t countries s o f t w a r e is accepted as an intellectual p r o p e r t y , that m e a n s the o w n e r solely can decide on the terms of its use. As interoperability, usually reached b y compatibility, in the IT i n d u s t r y is so important, standards play a crucial role. From our software-perspective w e consider a s t a n d a r d to be a c o m m o n set of functionalities w h i c h cawbe i n c o r p o r a t e d w i t h i n a piece of software, two or m o r e parties h a v e agreed on. A d o p t i n g a s t a n d a r d in our m o d e l w o u l d m e a n that both competitors agree on identical degrees of compatibility but not necessarily on total compatibility. Software standards can be set either by a g o v e r n m e n t a l non-profit-organization, or, m o r e often by a manufacturers' c o n s o r t i u m or e v e n by a single major software v e n d o r ( d e - f a c t o - s t a n d a r d ) . For the analysis it is not necessary h o w the s t a n d a r d has been set. In the following w e very briefly h a v e a look on the effects of a c o m m o n standard within our economic model. Formally this is d o n e by replacing s r and s s by s. As one can easily see, findings b a s e d on f o r m u l a e (15) to (21) are applicable in this n e w context as well, so that w e do not h a v e to repeat the analysis. The question for an optimal d e g r e e of s t a n d a r d i z a t i o n bears some interesting results and is p u r s u e d in (Reitwiesner, 2001). The Impact of the Market Entry of the Framework Technology onto Social Welfare So far, w e have a n a l y z e d possible m a r k e t shares for both t e c h n o l o g i e s i n c l u d i n g the impact on the profit of the software v e n d o r s . We also h a v e discussed in section 0, that from a technological point of view, it w o u l d be desirable, if the f r a m e w o r k t e c h n o l o g y c o u l d gain a h i g h e r m a r k e t share than it has at the moment. Based on our model, w e could have a look at the question, w h e t h e r there is a chance that the s t a n d a r d software v e n d o r can p r e v e n t the m e r e m a r k e t e n t r y of the f r a m e w o r k t e c h n o l o g y v e n d o r . We w o u l d see, t h a t m a r k e t e n t r y p r e v e n t i o n is g e n e r a l l y p o s s i b l e ( R e i t w i e s n e r , 2001). But s h o u l d the m a r k e t be k e p t o p e n for f r a m e w o r k t e c h n o l o g y f r o m a social a n d e c o n o m i c p o i n t of v i e w ? W h e t h e r this is d e s i r a b l e can be d i s c u s s e d t h r o u g h i n v e s t i g a t i n g the i m p a c t of the m a r k e t e n t r y of F onto the social welfare. The social w e l f a r e in the Bertrand-Nash Market equilibrium W B can be c o m p u t e d as the s u m of the c o n s u m e r surplus CS of all users (see (A8)) a n d the s u m of the profits of both suppliers (Woeckener, 1999). We thereby assume a s t a n d a r d has been established:

36

Knowledge, Technology, & Policy / Summer 2001

I

F

rr" = ZcS~.o

~;r~ +,.s

( .)2 XF

=Z-t.

0,5-T

,

.

+e(l+s)(x s+x'~+l)-c-2FC

(2)

We can derive the following statements from (2) regarding social welfare: (S1) W i t h r e g a r d to the n e t w o r k effect, one (marginal) unit of framew o r k p r o d u c e s the same a m o u n t of welfare as one (marginal) unit of standard software. ($2) In the case of an established standard social welfare is increasing with an increasing market share of the framework technology in the current period. So far, w e have a n a l y z e d the situation r e g a r d i n g the social welfare ass u m i n g both technologies have m a r k e t shares larger than zero. Do the results change, if the market entry is blocked by S? To give an a n s w e r to that question, w e have to c o m p a r e the social welfare W Mif the m a r k e t e n t r y is blocked, w h i c h m e a n s a m o n o p o l y of S, to the social welfare if the m a r k e t entry is not blocked Wff. We h a v e to a s s u m e the a d d i t i o n a l a s s u m p t i o n s (A12), (A13) to hold as well as (A6) not to hold. Wu

= Z -

0,25-t + e(1)(x s + 1) -

WD n = Z - t 0,5 -

+ e(1 + s ) ( x

c - FC

(3)

1) -

(4)

s +

c - F C - F C entry

If F can enter the m a r k e t , distance costs are r e d u c e d . Since w e h a v e two technologies, the n e t w o r k effect increases t h r o u g h compatibility, if the d e g r e e of s t a n d a r d i z a t i o n is greater t h a n zero. The a d d i t i o n a l fixed costs F C e"try r e d u c e social welfare. We can a n a l y z e the c o m b i n a t i o n of these effects by h a v i n g a look at the f o l l o w i n g inequality: Wd > W M (5). The formal analysis by m e a n s of (3),(4) a n d (5) allows us to d r a w the following conclusions about the impact of the m a r k e t entry of F on social welfare in the case a s t a n d a r d has b e e n established: ($3) If the fixed costs for the d e v e l o p m e n t of the f r a m e w o r k technology F C entry are sufficiently low (i.e. smaller t h a n the gain in c o n s u m e r s u r p l u s t h r o u g h the r e d u c t i o n of the distance costs a n d the a d d i t i o n a l n e t w o r k effect), the m a r k e t entry of F and thereby the d e v e l o p m e n t of a n e w parad i g m of software technology increases social welfare. ($4) The greater the distance costs per u n i t t, the greater the fixed development costs for framework technology can be. The more the users value the n e t w o r k effects (expressed by e), the greater fixed d e v e l o p m e n t costs can be c. p., if there is a degree of s t a n d a r d i z a t i o n greater t h a n zero.

Policy Implications for the Software Industry and the Standardization Organizations In this paper we discussed the economics of software d e v e l o p m e n t w i t h two c o m p e t i n g technologies. We could p r o v e that v e n d o r s of f r a m e w o r k based software can coexist with standard software vendors. In other w o r d s there is a chance for small companies to compete w i t h m a r k e t leaders. Furthermore, w e w e r e able to s h o w that from a welfare point of view, the com-

Reitwiesner and Volkert

37

petition between F and S is desirable. When we consider the most likely scenario in which the framework vendor is not yet established, we can clearly state the most important condition for coexistence of both technologies in the market, thereby we deliberately neglect other less relevant effects: Frameworks need to participate in the network effect resulting from a

large number of installations of the established technology. Now, we have to answer the question how this can be reached. Firstly, a high degree of compatibility of F can ensure this. As we have outlined in chapter 0, the adoption of a common standard by all competitors ensures compatibility and allows the potential users of the emerging technology to profit from the network effect of the established technology. But the decision of being compatible cannot be made by the framework vendor himself, because of legal and technical aspects. This issue may become an "explosive" political topic, as a rationally acting incumbent will avoid giving up his advantages and this may in the end even lead to a market entry prevention for a prospective competitor. When it comes to market failures and a social welfare optimum is missed the government is asked to intervene. This could e.g. happen by promoting the emergence of public standards in national or international standardization bodies like ANSI, ISO, CEN and ITU. Although legal enforcement of these standards is not acceptable, public authorities can promote the acceptance of those standards by claiming them in public contracts as it was done formerly e.g. by the US Department of Defense with TCP/IP. But, when observing the markets of fast changing software technologies, one has to admit that public standards play a minor role only. In most cases, relevant standards are set either by the market leader or by industrial consortia. Therefore the possibilities for governmental market intervention are rather limited. On the other hand, we have to discuss the policy implications for the standard software industry in case framework technology is able, despite of the mentioned obstacles, to gain first pieces of the market share and thereby starting to threaten the network advantages of the established standard software. As we have seen in chapter 0, the great advantage of framework based software compared to standard software technology is the exact fit to the customers requirements. Standard software vendors are beginning to copy this property by transforming their monolithic architecture towards "framework" oriented architectures. In case the new architecture is open to third parties, this scenario appears to be very promising for all participants: market leaders set sustainable standards, making their software the inevitable core system, small software companies provide components, thereby contributing to market competition and buyers of ERP-systems can build "best-of-breed" systems according to their needs picking from a wide choice of components. Briefly summing up, we can conclude by giving the answer to our introductory question: "Can the framework technology overcome monopolistic structures on the software market?" Our analysis allows to give a positive answer to that question and furthermore shows that the support of frameworks via the introduction of accepted standards set by standardization bodies or even by market leaders gives the potential to increase social welfare.

38

Knowledge, Technology, & Policy / Summer 2001 Appendix: M o d e l and A s s u m p t i o n s

(A1) Software users are c o n s i d e r e d to h a v e r e q u i r e m e n t s w h i c h can be c h a r a c t e r i z e d as dots on a h o r i z o n t a l line w i t h the l e n g t h 1. We ass u m e the users to be u n i f o r m l y d i s t r i b u t e d on this interval. The position of an i n d i v i d u a l user is d e n o t e d by hL (0,1]. (A2) The total d e m a n d for software is fixed, it is n o r m a l i z e d to 1. (A3) The f r a m e w o r k solution p r o v i d e d by F is s u p p o s e d to m e e t exactly the r e q u i r e m e n t s of any user along the horizontal line. The solution provided by S is located at a s . All users with requirements h different from a s face "distance costs" d (see figure 1).

Figure 1 Distance costs in Hotelling's (Hotelling, 1929) linear product space as

h

Io t(h-as)

distance costs for user h d s ( h ) = t. I h - a s [ for the users of S

(6)

d F ( h ) = 0 V h E (0,1]

(7)

for the users of F

t represents the cost unit rate per distance: the higher t, the m o r e important it is for the user to have a software w h i c h exactly meets his needs. ( A 4 ) S is s u p p o s e d to choose the position Us = 0,5 in the m i d d l e of the product space. (A5) Both suppliers are assumed to produce with identical marginal costs and the same costs per unit of software c respectively. (A6) We assume duopolistic competition, both have market shares greater than zero. (A7) Both suppliers are s u p p o s e d to m a x i m i z e their profits, w h i c h can be c o m p u t e d as = (p,

- c). x, - FC

t

{S, F}.

(8)

Decisions are m a d e for the c u r r e n t p e r i o d u n d e r the a s s u m p t i o n of c o m p l e t e information. (A8) The users choose the solution w i t h the greater c o n s u m e r s u r p l u s CS t (with 1 8 {S,F}). The c o n s u m e r s u r p l u s consists of the basic w i l l i n g ness to p a y Z m i n u s the e f f e c t i v e p r i c e of the s o f t w a r e s o l u t i o n p~, m i n u s the d i s t a n c e costs d l ( h ) p l u s the u t i l i t y d e r i v e d f r o m the n e t w o r k effect.

Reitwiesner and Volkert

39 (9)

C S r = Z - p r - t . 0 + en r

(10)

C S s = Z - P s - t. [ h - a s [ + e n s

o > 0 is a m e a s u r e for the general v a l u a t i o n of the n e t w o r k effects of the users, n t d e n o t e s the n e t w o r k size. (Ag) The users are s u p p o s e d to h a v e complete i n f o r m a t i o n about the prices and the degrees of compatibility of both technologies. (A10) The competition b e t w e e n F and S takes place in two stages w i t h simultaneous decisions on each stage: in the first stage ( c o m p a t i b i l i t y c o m p e t i t i o n ) the competitors decide on the d e g r e e of compatibility s t and s s . The t e c h n o l o g i e s can be i n c o m p a t i b l e (S/ = 0), partially c o m p a t i b l e (S/L ]0,1[) or fully compatible (S/ = 1). In the second stage (price c o m p e t i tion) the degrees of compatibility and by that the network a d v a n t a g e s / d i s a d v a n t a g e s of the technologies are given and the competitors try to set profit maximizing prices. We define the degree of c o m p a t i b i l i t y as follows: We treat the compatibility between two technologies, i.e. the compatibility between the standard software solution as a whole and the f r a m e w o r k (including all related components) as a whole. Partial compatibility is a s s u m e d to have the following meaning: a degree of compatibility e.g. 0.6 of software A w i t h software B means that 60 percent of the functionality of software B can be u s e d / c a l l e d up by software A. (A11) The indifferent consumer prefers the framework based solution. The resulting d e m a n d functions for solutions by F and S are: X F = 1 - 2,~[( PF -- PS ) + 6(Ar~ + S s - 1)] xs

= 0 + 2,;L[( PF -- PS ) + e(An" +

Ss -

(11)

1)]

(12)

with:

1 /1. = Ani

t - 2e(2 - s s - s r ) =

(Xis - xir) + ( S sXFi -- S r X si )

intensity of competition

(13)

network advantage for S

(14)

The resulting profit maximizing Nash-equilibrium price for F and S can be f o u n d at

1

p~ = ~ [3C+

1,

- e(Arf +

ss -

])1 /:~ =

1

1

[ 3 c + 2-~ + e a r / +

ss -

])1 . (15)

The corresponding market shares are x~ = - - - 2 2 a , e ( A r f + s s - 1 )

xsB = - + 1 2,~e(Acj + S s - 1 ) 3 3 3 3 At the bottom line, the following profits can be earned:

4 188e(Ani+ S s - 1 ) + 1 8 4 ~ 7 2 ( z ~ i

B_ Jr~ 18/1,

+ S s --1) 2 - F C

(16)

(17)

Knowledge, Technology, & Policy / Summer 2001

40

B

1

Zs = 18Z +

4 e(An i +Ss

]-8

_1)+ 4Ae2(An, +Ss _1)2 - F C

(18)

In s e c t i o n 4 ( o n l y ) w e n e e d t h e f o l l o w i n g a d d i t i o n a l a s s u m p t i o n s : (A12) The size of t h e i n s t a l l e d basis of F e q u a l s zero: X~F = 0 . (A13) S is a s s u m e d a l r e a d y to be e s t a b l i s h e d . T h u s S h a s to t a k e i n t o a c c o u n t o n l y the r e g u l a r p e r i o d i c a l a d o p t i o n costs FC, w h i c h o c c u r e v e r y p e r i o d . F w i l l h a v e to t a k e i n t o a c c o u n t t h e full a m o u n t of d e v e l o p m e n t costs for t h e f r a m e w o r k a n d t h e r e l a t e d c o m p o n e n t s . W e d e n o t e t h e m b y F C entry a n d h e n c e a s s u m e t h e m to be g r e a t e r t h a n FC: F C e"try > F C 9

Notes 1. 2.

An exact definition of the notion of compatibility we want to use for the purposes of this paper will be given in (A10). An overview of different types of compatibility can be found e.g. in (Shy, 1996, p. 253) and in (Wiese, 1997). Which is given by definition in the case of open source software.

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