Introduction Software services were first introduced to the market in the 1960s through utility computing by the IBM and other service providers in that time (Cusumano, 2004). Today, a number of service providers are involved in this industry and they include Google Apps, cloud, Amazon web services, Microsoft, Oracle to mention but a few (Cusumano, 2007). The software industry has developed since then and with the current technological advancements, the industry has grown into a big business characterized by very high returns (Utterback, 1994). This has been influenced by the rising need for businesses to engage the use of ICT hence demanding softwares to facilitate the migration. The majority of the businesses today have embraced ICT, which primarily depends on software products (Christensen, 1997). This paper will discuss the software industry, impacts of competition in the market, the rampant changes in software development as well as other issues involved in the software industry. Software market Before the introduction of softwares, computers used to be manually programmed by the customers or the limited computer vendors to perform specific functions (Knecht, Leszinski & Weber, 1993). The software market was developed fully in the 1960s as mentioned earlier. This was soon after the mass production and sales of computers (Hempell, 2006). Due to the sale of large quantities of computers to universities and the government, the need for softwares created a high demand. In the beginning, software developers did it for non-commercial purposes where softwares were exchanged freely among users (Oliviera, 2012). Programming methodologies were greatly extended by the introduction of the low priced microcomputers, which spread the use of computers to more user (Clair, 2005). These enhanced innovations and crated business opportunities for software developers as the demand and market for their products was expanding (Galin, 2004). The market expanded further in the mid 1970s, influenced by the introduction of personal computers, PCs (Hoch, 2000). This enhanced the market by creating demand on softwares for other functions like games and other utilities (Huang &Denne, 2003). By that time, the Microsoft operating system was the major software controlling a significant percentage of the market. Software services Software services include capabilities that a software gives to a computer allowing it to perform different purposes (Mowery, 1996). Service in computing is defined as the mechanisms that give a computer the capabilities to access different functions (Cusumano & Selby, 1995). The access to these functions is enabled by specific interfaces as provided by the developer (Platt, 2007). Software services depend on the specific function that a consumer requires. For instance, every computer requires an operating system to function. These are systems made by software companies for commercial intentions (Fowler & Beck, 2001). The antivirus is a good example of software used in computer which performs very vital functions. The computing world has suffered for years due to the entry of harmful softwares in circulation (McConnell, 2004). To counter the effects of harmful programs that have the capability of destroying a computer, software developers created other softwares with the capability to detect and block