NEW YORK – The universe won’t fit into a closet, but in some stores barely that much space and often less is allocated to selling a burgeoning universe of software.
Searching for a solution, a group of retailers and software publishers has begun experimenting with new in-store kiosks that could soon let shoppers buy from a huge selection of software titles, no matter if a merchant carries an item or has it in stock.
To make that possible, the touch-screen system offers a “virtual inventory” of software, then burns a CD-ROM to a customer’s order in minutes.
The system, SoftwareToGo, was installed last week in six Office Depot stores around the country. It will be added in coming weeks at two more Office Depots and three The Wiz electronics stores in the New York area, and in a few Sears and RadioShack locations early next year.
SoftwareToGo’s touch-screen terminals now list just 200 titles, soon to grow to 300. But developer Protocall Technologies Inc. of Commack, N.Y., says it has signed deals with 14 software firms and is talking to others – including industry giant Microsoft Corp. – about selling some of their products via its burn-to-order system.
“We believe that this is a more convenient and more efficient way to shop for software,” said Bruce Newman, president and CEO of Protocall. “There are many, many titles out there, and what our system does is make it easier for consumers to shop.”
The system also is designed to appeal to retailers short of shelf and storage space and publishers eager to put their full range of products before consumers.
It’s not the first time for such an experiment. In the mid-1990s, a joint venture between IBM Corp. and Blockbuster Inc. developed in-store technology to offer virtual libraries of music and video games, replicated in minutes on CD-ROMs or cartridges.
The technology worked, but the venture failed because music publishers were reluctant to cede control of content and disagreement festered between retailers, video game companies and game developers about how to divide profits.
If SoftwareToGo can solve such issues – and the company says it has – the technology offers great promise for retailers struggling to manage inventory, limited shelf space, problems with theft and other challenges, retail consultant Kathryn Cullen says.
“It’s a great concept,” says Cullen, director of e-business for Kurt Salmon Associates in New York. “It certainly alleviates a lot of burden for the retailer in ordering, storing, receiving and tracking all of that inventory.”
SoftwareToGo is comprised of two parts. The first is a kiosk equipped with a flat panel display and a printer to generate a receipt.
Once the shopper pays, a store employee scans the receipt into the system and an Internet connection relays a prompt to the second component, a CD-burning station. That clears the way for production of a single copy of the software, stored on the system’s hard-drive, in about five minutes.
The CDs will sell for the same price as software sold through traditional channels, Newman said. Most of the titles offered through SoftwareToGo sell for between $14.99 and $200.
“What this does is allow us to get sales we would otherwise miss,” said Carol Martin, vice president of merchandising for Delray Beach, Fla.-based Office Depot Inc.
Software developers are encouraged by the potential of electronic software delivery, seeing it as one more way tap more customers.
“We don’t see it as a replacement for our current (distribution) channels, but more as an enhancement,” said Tom Mackey, director of North American retail sales for Symantec, developer of the Norton AntiVirus software. “If the buying public embraces this out there, then we want to make sure to have our products available, accordingly.”
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