As if all the acronyms weren't enough, the PC industry is now showing an annoying propensity for business buzz words.

Software like Lotus 1-2-3 and WordStar isn't just software, it's horizontal market software. What's that? Software with functions that appeal to a broad spectrum of PC users.

So guess what people in PC software are all hot on now? Vertical market software. What's a vertical market? A specific user group. Doctors are one type; lawyers are another, and left-handed dentists who live on the East Coast still another. You see, folks in the software industry fear that there is too much competition in horizontal markets now, and they're shifting their emphasis to vertical-market products.

Keeping with this metaphor of market geometry, I'd like to point out that diagonal markets in software shouldn't be ignored either. You won't find diagonal markets in your business textbooks -- I made it up. But I'm quite serious about their importance.

What's diagonal software? It's software that cuts across both vertical and horizontal markets: It doesn't quite have the broad appeal of word processing or spreadsheets, but it isn't tailored to specific users such as lawyers and left-handed dentists.

A good example of diagonal software would be a program that lets you create and format documents that can be turned into overhead transparencies on your computer screen before you print them out on the daisy wheel. This is a task not well-suited for most word processing and graphics packages. Obviously, not everyone uses overhead projectors for presentations; then again, a number of people in a wide range of industries constantly prepare transparencies for presentations. Clearly, word processing and graphic software aren't necessarily designed to create overhead transparencies. So this kind of software falls somewhere between horizontal appeal and vertical depth. There are other names for diagonal software (I like mine because I made it up) like "accessory software."

According to Infocorp, a Cupertino, Calif.-based research firm, worldwide sales of accessory software to end users last year came close to $4 billion. Infocorp projects that by 1988, the figure will be closer to $5 billion.

But there's an obvious problem with diagonal software. Marketing it is very difficult. Computer stores have limited interest in carrying things that don't have wide appeal. Similarly, appealing to individual vertical markets doesn't reach all the people who might be interested in diagonal programs. Consequently, computer magazines are filled with advertisements for diagonal software.

What to do? Software Publishing Corp., the Moutainview, Calif.-based creator of the PSS software series, has taken an interesting approach. The company has launched a direct-mail catalogue called "Power Up" that lists all kinds of diagonal software products. The company sort of wants to become the L. L. Bean of such software. Last year, Software Publishing mailed out more than 750,000 catalogues.

One of the best sellers was a nifty program called "Banner Builder" -- software that lets you use your PC to print out oversized banners. Another, "Typewriter," can fill out preprinted forms -- a task most word processors can't handle. The bulk of software publishing's diagonal software offerings are priced in the $50 range -- accessory software for the most part is designed to be fairly low cost. (Power Up, P.O. Box 306, 125 Main St., Half Moon Bay, Calif. 94019)

I think we're going to see a lot more of this direct-mail approach to marketing software -- especially diagonal software -- because you get economies of scale when you bundle all these different diagonal software programs into a single advertising package.

Conversely, expect to see public libraries become repositories for diagonal software. Also, corporations with large PC populations will set up their own software libraries for their corporate PC users.

While diagonal software may not be as sexy as Lotus or as lucrative as vertical markets, it represents an interesting and important trend in the field: a comparatively low-cost way to add value to your machine for specific purposes. Diagonal software will never become one of the most important parts of personal computer software, but it is likely to become one of the most useful for a diagonal section of people with special needs from their personal computers.