The software industry is undergoing a gradual transformation, and consumer fatigue is at its root. The licensing model that has formed the basis for the modern software industry is facing challenges on many fronts, and the industry is scrambling to keep its footing. Where this period of change may lead software producers and consumers isn’t quite clear, but some trends are emerging. Since the proliferation of the internet, unauthorized redistribution of digital goods has become rampant. But although software sharing probably won’t kill the software industry, the reasoning behind it shares some pedigree with the customer revolt that promises to transform the way software is sold.
Four of the top 20 richest people in the world made their money from software. Over the past two decades, no other industry has been responsible for making a select few people so much money so quickly. And it’s especially amazing because so many of these people started with so little.
You don’t need a lot of infrastructure to create a blockbuster software program. And most importantly, if it becomes popular, you just keep selling copies like you’re printing money. The sale price of a software license is not based on the price of the component parts like a manufactured good. It’s usually not even based on its complexity or the amount of R&D effort it took to produce it. It’s a product with unlimited supply, whose price is set by the demand for it in the marketplace.
For example, the complexity of the Oracle database and the amount of man-hours that has gone into its creation is probably less than that of the Windows operating system, but it costs a hundred times more. Lucky for Bill Gates, there’s a demand for a much higher quantity of Windows licenses. I guess that’s why he’s more than twice as rich as Larry Ellison.
Bytes and bits, considerable brainpower, and a lot of good fortune created empires, and it was all based on a simple formula: create some software that people want, preferably software that large businesses want in large quantities, charge the maximum amount that the market will bear, sell lots and lots of licenses, make a better version of the software a couple of years later, that fixes some of the annoying problems that plagued the earlier version, sell lots and lots of licenses again, and so on.
Intellectual Property
Other industries produce and sell goods of this type. The book publishing and motion picture industries also produce “virtual” goods for which the cost to produce another copy is relatively small. The only way that someone can write a software program, or a song, or write a book and have a hope of being the primary beneficiary of its proceeds is if there is a legal mechanism to prevent its unauthorized copying and redistribution. It’s about enforcing intellectual property rights, and from the very birth of the concept, consumers have been a little reluctant to grant it the same moral weight as physical property.
Intellectual property has always existed, but its owners have had mixed success in enforcing their ownership of it. In early societies, inventors of new tools or methods were probably content to be given credit for their ideas and enjoying a boost in status for, say, inventing the wheel, or irrigation. Later people developed layers of secrecy around their knowledge, such as the expert stone masons of medieval Europe, who founded a secret society upon their desire to maximize their earning potential by limiting the number of practitioners of their craft.
Around the same time, intellectual property was also protected by laws. Church scholars who translated the Bible into local languages were savagely executed by the church/state in an attempt to keep a monopoly on religious and political power. But the average inventor didn’t have much protection, and was lucky to even get credit for his or her invention. This went on for centuries. Famously, Isaac Newton invented Calculus but reportedly sat on his discovery for years for fear of someone stealing his ideas.
Eventually, governments created protections for intellectual property, via patents and copyrights. Patents started to take off in Europe in the 16th century, with the monarchy asserting control over commerce and innovation. Copyright proliferated in the 18th century, with the widespread ownership of printing presses. Overall, these laws were a boon to the advancement of knowledge and art in the world, because it gave inventors and creators an opportunity to more easily benefit monetarily from their creations, and perhaps even dedicate themselves full-time to their professions. Eventually, intellectual exercise, which had long been the domain of the economic elite, was opened to normal folks.
The typical individual, the ultimate “consumer” of these ideas, however, was never all that keen on the higher ideals. A good idea was a good idea, and people were always eager to appropriate it for their own benefit. Eli Whitney was constantly in court trying to protect his patent on the cotton gin, and by the time the courts ruled, his patent had expired. The early days of book and pamphlet were a free-for-all. Shakespeare probably didn’t earn much money from the publishing of his plays and sonnets, but, having cribbed most of the stories for his plays from other authors, I doubt he worried much about it.
Even when one country enforced copyrights rigidly, other countries were always eager to capitalize on the inventions of others. Several of America’s founding fathers were dead set against honoring European patents, hoping to give the fledgling state a leg up in competing with Europe’s massively more developed economy. In the 20th century the U.S.S.R. and its satellite states were loath to pay royalties to Western authors and artists. And today, the marketplaces of countries all over the world are filled with unauthorized copies of software, music, movies, and books.
Historically, copying a new invention or a book involved quite a bit of effort, and most people were content to buy those products or books from whoever sold them. It wasn’t until a product came into the marketplace that was in high demand but was particularly easy for the average person to copy that there was a real crisis. In the days before recorded music the main way for new songs to proliferate was by selling sheet music. But copying the music and words of a new song is easy to do even by hand. It doesn’t take more than a few minutes, and once you learn the song, you can perform it all you want and even teach it to others. In the 19th and early 20th centuries there was a copyright infringement crisis in the music industry. Within a few decades, radio and recorded music came on the scene, and songwriters no longer depended on sheet music for their livelihoods.
The invention of the photocopier created another crisis of sorts for the publishing industry, as it allowed small-scale copying of published material. Shortly after that, the VCR gave the TV and motion picture industry a heart attack. It turned out to be the best thing that ever happened to them, but that’s another story. But the mother of all intellectual property crises was born at exactly the same moment as the software industry really hit the big time: the proliferation of the personal computer.
At first, software was included with the computer, and wasn’t really assigned any value outside of that context. If you had a Univac, it came with some software, but most of it you had to write yourself. Eventually, companies started writing software for other companies, but its use was limited to a very small pool of business users, and the associated contracts and other legal agreements were strict enough to keep that software where it was supposed to be.
But when the personal computer came out, suddenly you had these ever-more-powerful tools in the hands of a lot of people, including a lot of kids. And these computers needed software, but a lot of people didn’t want to buy it, and frankly didn’t think they should have to. And the software was so easy to copy. Even in the days of cassette drives and gigantic floppies it was easy, though it was slow. And copy they did. At first it was kids swapping floppies, then using BBSes, and later the fledgling internet. It stayed small-time for a couple of decades, but even back then it was enough to cause a young Bill Gates to lash out at hobbyist software copiers.
The software industry took steps to prevent copying, with license keys, elaborate protection measures, and even hardware devices that were required to use the software. But most of these methods were eventually cracked, and those cracks were disseminated within the community, and the protection measures ultimately succeeded only in annoying and inconveniencing legitimate customers.
Luckily for the software industry, the real money was in selling to businesses. Though smaller businesses also routinely violated software licenses and made illicit copies, the high stakes for violation and aggressive enforcement through the Business Software Alliance ensured that most businesses would pay for software, so the piracy problem remained mostly an issue for companies that sell to the general public.
Unauthorized copying and redistribution is also a major issue for companies that want to expand overseas. Just like the early American founding fathers, many people in less developed countries see the vast wealth of the Western software industry and feel no moral obligation to pay into it. They feel that constricting economic development for lack of ability to afford foreign software just doesn’t make sense. And sympathetic lawmakers in those countries are reluctant to enforce foreign copyright with too much vigor.
Major software companies have generally taken a philosophical attitude toward this problem. Microsoft has even been accused of encouraging distribution of pirated copies of Windows in the less developed world because it takes the long view: as countries like China and India become more developed, and governments spring to protect its domestic software industry by cracking down on copyright violators, everyone will have become hooked on Windows, and will start to pay.
But even taking rampant piracy in some countries into account, unauthorized redistribution was no kind of death blow to the software industry, even its most vulnerable, consumer-oriented companies, until the personal computer revolution took its most dramatic turn in the mid 90s with the popularization of the Internet. The easy copyability of software was already a problem when the mode of sharing was recordable media. Once the bits and bytes could be disseminated over the net, the industry found itself with a genuine crisis. And as the pipe got wider, the problem spread to the other intellectual property-based industries. In the early days of the internet the publishing world was already under assault (though I doubt they even knew it at the time) as unauthorized digital copies of books and other printed media, but probably mostly porn, were shared over the network. Then music, then movies.
Today, if I’m sitting at my desk, it’s vastly quicker and more convenient for me to download most software programs that I might want illegally than it is for me to buy them through legal channels. And that’s a serious problem for the software industry.
But the problem for intellectual property-based businesses isn’t that it’s quick and easy to infringe. It’s also quick and easy to smash a store window or run over a kid on a tricycle. But regular, decent people don’t do those things. But regular, decent, normally law-abiding people do routinely violate intellectual property laws. And why? Because while they do realize that it’s wrong on some level, they find it easy to justify.
I actually didn’t embark on this long examination of the history of intellectual property in order to claim that software “piracy” is the major bane of the software industry. It’s a problem, especially in certain sectors, but the industry has managed to thrive despite it. But the true challenge to the industry’s status quo is not unauthorized copying, but it’s related in that the routine justifications that infringers use are closely related to the sentiments that the largest consumers of software are starting to develop. And it’s a growing rebellion that the software industry is going to be forced to deal with.
So why do otherwise law-abiding citizens feel that they can morally justify infringing copyright? The industry likes to paint them in one of two colors: either they are morally equivalent to thieves of any other good, no better than the pickpocket or shoplifter, or they are uninformed fools who don’t understand that their actions are illegal and hurt the people who produce the software, music and other good that are being shared illegally.
I believe that neither of these characterizations is particularly accurate. In fact, I believe that most of these people are quite sophisticated in their understanding of the economic and moral impact of their actions. They feel justified in infringing because they have made the judgment that the purveyors of these goods in the legitimate marketplace are taking advantage of them and not meeting their reasonable demands for fairer pricing and more convenience in distribution. And in fact, even your typical teenage mp3 hound has a pretty complete understanding of the economic forces at work. They don’t do it because they misunderstand. They feel justified in doing it because they do.
Copyright infringement, though immoral, is not morally equivalent to theft of a physical good because infringement does not deprive the owner of his or her possession of the good. If I pick your pocket, you no longer have your wallet. But if I hear you whistling a tune, and start whistling it myself, and teach it to others, I have not prevented you from continuing to whistle. The only problem comes when you expect to have the exclusive right to benefit monetarily from the performance of that tune. In this case, by learning it without your permission I have degraded your capability of selling it to myself and any others that I taught it to. It still has an impact, but a completely different impact than stealing a physical good would have.
In some cases, copyright infringement could have a much more damaging impact than theft of a physical good. I could steal Bono’s sunglasses, and he probably would only be mildly annoyed. But if I got my hands on U2’s new album a month before release and put it on the internet, that could mean thousands of dollars in lost revenue for him. But even in that case, the impact is different.
Back to the infringer’s understanding of economics. Most goods, physical or intellectual, must go through a complex economic cycle between the inventor and the consumer. Physical goods must be designed, patented, manufactured, transported, packaged, transported again, warehoused, marketed, sold, shipped to distributors, sold, shipped to retailers, sold, and delivered to end users. Virtual goods like software and music generally go through the same cycle, though the manufacturing process is usually a bit simpler. At each of these stages, a middleman takes his share. And some of these shares are pretty big bites.
For many products, the retailer takes half of the proceeds, and the distributor takes half of the rest. Printing and/or pressing to digital media cost money, and all of these packages must be shipped back and forth. And what benefit does the average consumer derive from all of this? None. In fact, a negative benefit, because they have to drag themselves to the store to go get the product or wait around for it to ship. The fact that they have to pay an inflated price to support all these unnecessary steps and middlemen just add insult to injury.
Furthermore, there’s a populist angle to the justification. After all of the sales and distribution people take their cut, a small percentage actually goes to the company that brought the product to market. The thing is, the people who actually produced the goods, the software or the music, or the book, don’t even get nearly all of that. In many cases, the amount that the actual creator receives is less than one percent. And there’s recognition of that, and a lack of enthusiasm among consumers to subsidize all of that old fashioned infrastructure in exchange for printed material and physical media that they don’t need and a product that should be available instantly but isn’t.
There’s a similar reluctance to support the old order among business customers, who are even more privy to the way commerce really works. If you want to buy software for your business, you typically either work through some kind of mail order house or systems integrator, who takes a cut, or through a pushy salesperson from the vendor.
And the steps that software firms have taken to reduce piracy have made management of licenses a major headache for larger companies. And the stakes are high. If a disgruntled employee calls the BSA on you, and your lack of organization has resulted in re-use of a few Microsoft Office serial numbers, you could be facing major liability. So businesses end up buying a lot of software, and a lot of it comes in boxes that junk up the place, with little slips of paper containing the oh-so-important license key. And you inevitably end up buying a few more licenses for stuff than you really need, so you have expensive software sitting on the shelf, not being used, which will become obsolete and worthless within 18 months.
Business as Usual
The prices for most “enterprise” software varies a lot, and seems to be mostly based not on any kind of objective metric, but more based on a voodoo-like attempt on the part of the salesperson to determine the maximum amount the business will pay. Licensing fees, maintenance agreements, and consulting are all intermingled into a figure with a lot of zeroes, and of course the software firms are not interested in the software that will be solve your problem the best, but rather the solution that will perfectly match the maximum amount that the business can afford to pay. This usually results in vastly over-ambitious projects involving legions of employees from the vendor and the customer trying to work together and implementation timeframes of as long as a year or more in some cases. More often than not, the end result is a major disappointment and the project is scrapped, despite huge expense and major effort.
Now this scenario, which plays itself out over and over again in the business world, is not all the fault of the software companies. The software companies are putting their revenues ahead of their customers’ best interests, but that’s expected. Their job is to sell as much of their software as they can. The other half of the blame goes to gullible upper management at businesses who is too easily swayed by fawning acclaim in the trade press and flashy vendor presentations at trade shows. Companies like Oracle, who recruits its salespeople from among the Great White Sharks swimming off Southern Africa, are great at closing huge sales through sheer force of will. And why are these salespeople so aggressive and successful? Because they are richly rewarded for their efforts. The best salespeople in the enterprise software business make millions of dollars, literally.
And because the pricing of software is based on demand, and supply is unlimited, the salespeople, top managers, and investors in successful software companies can make lots and lots of money. So software consumers are being sold overly-ambitions software implementations that often fail, resulting in hundreds of thousands of dollars down the toilet, while the sellers are rolling in the dough. And did I mention that a lot of this software sucks?
Here at OSNews, people complain constantly about the well-known shortcomings of Windows, Linux, and other OSes. And they’re correct. Even the most widely-used software is bound to be fraught with defects, minor and major. But the quality of some of the “enterprise class” software out there is absolutely frightful. I won’t name any names, but anyone who’s worked in big business IT can probably rattle off a few of the worst offenders.
It’s not because these software firms don’t have talented engineers. In fact, in most cases, their original products were creative and well-designed, and many of the big firms’ flagship products are very good. But usually, once a product has started to sell well, the demands of the bottom line start to trump product quality. Typically, enterprise software needs either extensive customization or the user is forced to shoe-horn their needs into what the software can do well. Usually the ultimate solution involves a combination of the two, so you have clumsy workflow mixed with hastily-created customizations, and the whole thing can come off a little unwieldy.
Add to all this the fact that the software engineers are being hounded by management to include product functionality for the sake of increasing sales, while often bug fixes, security issues, and architectural improvements fall by the wayside. The goals shift from creating an excellent product to creating sales. And this is accomplished in a few ways:
Chasing fads: Whether it’s XML, “Push,” Java, Linux, or the dozens of other fads and buzzwords that have swept the software industry over the past few years, you can always count on a vicious circle occurring in the software industry. The trade press will start hyping the latest buzzword, then customers will start asking the salespeople if their product has it, the salespeople will say yes, that it’s in the next version, then marketing and PR will gang up on the engineering VP and demand that they immediately add XML or Linux or Java to the next version. Sometimes these fads mark real, worthwhile trends, like the move from client-server to web-based architectures. Other times, it’s all just a waste of time and a distraction.
Creating spin-off products: Database vendors sell an important product that forms the backbone for many companies’ IT infrastructure. But naturally a database doesn’t do anything by itself. So they have partners who provide various systems to run on it: a Human Resources package, a financial package, etc. But those partners seem to be getting all the money, so the database vendor makes a couple of hasty acquisitions and gets some products together. And they use their leverage as the database vendor to get their customers to buy their new applications. And the core product might lose engineers as the best ones are shifted off to these new enterprises, or development of the new core functionality might get sidetracked with supporting other projects and their needs. So you get an excellent but neglected and fragmenting core product, and a bunch of spinoffs that may still be vastly inferior to the former partners’ products.
Manufacturing pretexts for upgrading: Whenever a new release of Windows or Mac OS is in the works, there’s always a big push to publicize the flashy new features it contains. And though sometimes these new features are a revolution, usually they’re just eye candy, or modest improvements on existing utilities. The real advantages of these new releases, security enhancements or performance boosts, are usually too modest or just plain too un-sexy to get people too excited. Worst of all, many times the big new reasons for upgrading are often the fixing or partial fixing of serious flaws from the previous version that should never have existed in the first place.
And when that doesn’t work, forcing an upgrade: OS vendors are probably the most guilty of this one out of all the software makers, but it’s widespread in the industry. If too many years go by and a software company’s users are just not being attracted to the paid upgrades that are being offered (for example, there hasn’t been a feature added to Microsoft Word since 1993 that I cared about), then there are various dirty tricks that they can do to force me to upgrade. They can mess with file formats, so my version of the software won’t be able to open newer documents. They can “stop supporting” older versions, which may mean that security flaws won’t get fixed and compatibility other software won’t be resolved, in addition to the fact that they won’t take my phone calls anymore.
In each of these cases, the demands of revenue generation trump improving the product. Where does fixing bugs, improving architectural elements, and maximizing security come in? As a necessary evil.
So, to sum up, kids and other individual consumers of intellectual property feel like massively rich and powerful corporations want to force them to subsidize an outmoded sales and distribution regime that’s inconvenient and annoying to them, and that’s how they justify file sharing. Similarly, decision makers in the world’s companies feel like they’re caught under the thumbs of massively rich and powerful software firms who want to force them to subsidize an outmoded sales and distribution regime whose goal is to maximize revenue even at the expense of their IT projects’ success and puts them on a treadmill of forced upgrades and implementation of substandard spin-off products. And all this for software that mostly doesn’t work all that well in the first place. Does it push them to violate copyright and licenses? In some countries, yes. But in the US, the BSA’s big stick is an effective deterrent. What it has done is push companies to consider alternatives.
Open Source Software
The most famous of the alternatives to the status quo is open source software. Now, free software of various kinds had been around for decades before it caught on with mainstream businesses. Because of its long history in academia and government, there was some very mature and useful open source software already available when people started paying attention to it. It was the internet that really made the difference. Suddenly, the advantages that commercial vendors had with their distribution networks, marketing machines, service and support capability, and sales teams evaporated. It suddenly became easy to spread information about free software, distribute binaries and source code, provide documentation and support, and create a collaborative development environment at almost no cost via the internet.
Sure, a lot of the open source software was a bit rough around the edges, and with the popularization of the internet came a proliferation of new open source projects, many of which were immature. But the bar really wasn’t all that high. Even some of the most widely used enterprise software was either of dubious quality or was vastly over-qualified for the task at hand. Projects like Linux, Apache, PHP, and MySQL were either close enough in quality to their commercial alternatives to be workable, or the commercial alternatives were overkill for the task anyway. Who needs a $7000 Sun server and a $5000 Oracle license for a regional sales intranet anyway?
Many people still scratch their heads at the phenomenon, wondering why individual programmers and even for-profit companies would be willing to donate their efforts to open source projects. That’s the subject of many other interesting articles, but suffice to say, many of the beneficiaries of these tools don’t care where the idealism is coming from; they’re just reaping the benefit. The availability of open source software has made some niches virtually unprofitable (Unix on x86, webservers, scripting languages), and has provided enough competition in others that companies that were on track to completely dominate their markets have had to fight tooth and nail instead (Microsoft’s Server OSes).
Software-as-Service
Other companies took a different path, but it was another one that was only made possible by the internet. Some people realized early on that with a fast, reliable network at their disposal there was an opportunity to centralize IT infrastructure in radical ways. Whereas only a few years before it was necessary for every branch office to maintain a complex, interconnected network of systems, it was now possible to consolidate them, and in some cases to outsource them altogether.
Probably the poster child for this phenomenon is Salesforce.com. Most companies that maintained sales teams had made the transition from rolodexes and file cabinets to computerized databases and lead-tracking tools, but most of these were either non-interconnected, glorified address books or wildly expensive client-server systems. So Salesforce.com started offering a really good sales force automation system right over the internet for a monthly fee per salesperson. And they’ve become incredibly successful. Their customers are still spending money on software, in some cases a lot of money, but they know exactly what they’re getting for their money. And they don’t have to shoulder the risk of a botched implementation, worry about scalability, or hire or train staff to maintain the system. And if they end up dissatisfied, there was no huge up front cost and effort. They can just walk away.
Many companies, new and old alike, have embraced this model of selling access to a centralized system rather than (or in addition to) selling software the old way. Sure, web-based interfaces can be clumsy, and the internet can pose reliability and security problems, but there are a lot of ways to deal with those special challenges, and they look minor compared to the dangers of the old way.
In a way, all internet users have experienced this very same revolution in software, but just haven’t noticed. If you were to look at a listing of consumer-oriented software for sale ten years ago you would see titles for mapping, mortgage calculators, dictionaries and encyclopedias, games, business directories, book and periodical archives, tax and financial software, and other titles that have now been largely replaced by online services, many of which are free. Once CD-ROM based dictionaries or maps were largely unnecessary, because it was so much more efficient and economical to use the online ones, the market for them completely dried up.
Subscription Pricing
Many companies are jumping halfway onto this new bandwagon by keeping the traditional software but overhauling their licensing terms. Instead of a perpetual license with a large fee, they charge an ongoing subscription fee.
This solves a couple of consumers’ gripes. It makes it easier to spread the expense out over time, which the green-eyeshade guys always like, and it gets the companies off the upgrade treadmill, or rather, it puts them on it, but more straightforwardly. The vendor is not given the perverse incentive to produce flashy new functionality or engage in dirty tricks like messing with file formats that will entice or compel users to upgrade. Instead, they must provide consistent value and steady improvement that will make the user feel that the subscription is paying off. And depending on the terms of the contract, the user may find it easier to walk away from software that isn’t performing as advertised.
The Combo Shots
All of the issues that we’ve discussed are having an impact on the software industry, but what might have the biggest impact is that some of these issues are “ganging up” to deliver a one-two punch.
Open Source + Piracy
There are many countries in the world where most people, including legitimate businesses, do not pay for software licenses. This is not a sustainable state of affairs, however. Eventually, those governments will have to crack down on copyright violation, or they’ll have a hard time negotiating trade agreements with the United States and Europe. So individuals, and especially businesses, will have to go legit at some time. There are two ways of going legit, however; they can start paying for commercial software, or they can foreswear it.
For example, Microsoft’s alleged tactic of looking the other way while developing nations become hooked on Windows might not pan out. Many developing countries see the benefit of having more control over the platforms that they base their new information economies on, and open source software is a great opportunity for them to exercise that control but not have to start at square one. China has famously adopted its own Linux distribution, Red Flag. Similarly, there’s a lot of Linux activity in India. In both nations, there is a considerable amount of brainpower to tap and limited capital. That could mean huge advancements in open source platforms that become popular in those areas, and commercial vendors like Microsoft may never see those countries open up to their products like they’d hoped.
In another odd bit of synergy, P2P technologies like Bittorrent were developed to make it easier for individuals to share files with millions without having thousands of dollars in bandwidth charges. Of course, these P2P networks became popular ways of trading unauthorized mp3s, software and movies. But now that these systems are in such widespread use, it makes it even easier for open source developers to release a hot new project into the world, even without a fat pipe.
Open Source + Subscription pricing
With so many middlemen taking their bite out of the pie, someone with a modestly-priced piece of software isn’t really looking at making that much money selling software the traditional way. For every software billionaire, there are a thousand would-be entrepreneurs who never made any money. In many sectors of the software industry, though, the big money isn’t made from licenses, but from consulting, support contracts, and other services. In these cases, some entrepreneurs have made the calculation that it’s better to give away the software altogether and hope that free redistribution and word of mouth will do all the marketing for them. Then, they can offer an array of services to the users. This business model has been modestly successful for smaller software companies, though it hasn’t yet been proven on the large scale.
Other companies have set up the same kind of services based on already-existing open source software, developing an expertise, contributing to the projects, and even hiring the key developers and putting them on salary. Some examples: Red Hat, IBM (and now Novell) with Linux, Covalent with Apache.
Red Hat, whose “product” has always been as much p a service as a product, now operates exclusively under a subscription-based service contract. So although strictly speaking an ongoing license fee is not required to use Red Hat Enterprise Linux, you pay an annual fee to get maintenance, upgrades, and support from Red Hat, and the primary conduit for maintenance and support is a proprietary service called Red Hat Network.
Software as Service + Open source
The combination of open source software and software-as-service has made it easy for new companies to enter the market. A well-implemented idea can be put into practice with almost no capital expenditure. Even though open source software often requires more expertise to set up and manage than commercial software, with its polished installer, professional documentation and well-staffed customer support center, all those advantages are for naught when it’s all managed behind the curtain by skilled engineers and admins who are comfortable with the open source tools.
The Results
So how has the software industry dealt with these challenges? They’ve had a long time to try to deal with illicit copying, with limited success. One sector that has long been the most affected by unauthorized sharing and has had a back-and-forth battle with crackers for decades is the game industry. The internet intensified that challenge, but has emerged as a savior. One of the hottest new software segments is networked games, and game companies have either used those networks as a verifier of legal licensed software or have even set up monthly subscription services that are required to pay. But most of the other software makers have relied on the legal liability that businesses would have if they get snitched on to the Business Software Alliance.
The reaction to the open source threat has been more pronounced. After an initial stage of denial, the availability of quality open source alternatives eventually lit a fire under the commercial vendors, who were forced to pay attention to quality, slash their prices, reform their licensing schemes, and overhaul their sales practices in response. Therefore, the fact that so many businesses searched for an alternative made a huge difference even for those that stuck with the commercial vendors. Windows Server 2003 is the best OS Microsoft has ever made and Sun sells a $995 server now. Coincidence?
But let’s not forget the old standby that technology firms use when faced with a vibrant new competitor: a massive PR campaign. Microsoft is in the midst of a concerted effort to tout its advantages over Linux. In fact, there may be an ad right at the top of this page promoting Windows’ superiority. Steve Ballmer and Bill Gates have been flying all over the world for the past couple years trying to keep large firms and even entire countries from adopting Linux. But they’ve also been (at least giving lip service to) making security a much higher priority at the company.
There’s still plenty to gripe about when you need to buy software these days, but the consumer is in a much better spot today than they were ten years ago. There are more licensing options, pricing has improved a bit, there’s always the open source alternative for some software, which will at least give you some leverage at the negotiating table, and even the option to not buy and install software at all, but simply pay a monthly fee.
The internet is really the culprit here. It made the producer-consumer relationship so potentially frictionless that other industries that thrived on that friction are feeling the squeeze too: music, newspapers, teleconferencing, wireline telephones, real estate, travel agents, even the movie, television, and book industries are all seeing their roles as the conduit between customers and producers be subverted. Some of the intermediaries may not survive at all, while the rest will be forced to change.
Only time will tell, but I think that we’re seeing an inevitable pendulum swing over to software consumers having a bit more power over the sellers than in the past. And we may not see the easy billions to be made in the software industry. They may just have to work a little harder for their money. Would that be a bad thing?
Is open-source to blame?
How about off-shore outsourcing IT jobs?
This is a good article. Very very well written, he covers just about everything at least a little bit; without being boring.
heh, I find it funny how the author mentions bittorrent as being intended to help piracy and helping distros as a side effect, when in reality bittorrent was always designed to help get linux distros out and piracy was the unintended side effect.
Good article. Still digesting it all right now, still not sure if I agree with all the points made, but it’s much better than the usual OSNews article.
I can foresee the day when the internet is going to make instant voting possible and the need for representative government superfluous. Government is the last organization that relies on being a middleman between people and their goals.
I’m not sure I see how internet voting obviates legislators. Most people can’t take the time to understand all the various legislation they vote for. I imagine only a fraction of the people who do pay attention speak sufficient legalese to draft legislation.
It was not my intention to claim that Bittorrent was intended to help piracy. I said, “P2P technologies like Bittorrent were developed to make it easier for individuals to share files with millions without having thousands of dollars in bandwidth charges.” In the next sentence I note that it became a popular way of doing illicit file sharing, which is of course true. Without illicit filesharing, Bittorrent and other P2P technologies would never have caught on with so many people. I’m not making a value judgment here. I recognize that BT’s pure purpose is very admirable and useful.
“heh, I find it funny how the author mentions bittorrent as being intended to help piracy and helping distros as a side effect, when in reality bittorrent was always designed to help get linux distros out and piracy was the unintended side effect.”
Actually, you had it backwards.
<em>In another odd bit of synergy, P2P technologies like Bittorrent were developed to make it easier for individuals to share files with millions without having thousands of dollars in bandwidth charges.</em>
He then goes on to mention how it has impacted mp3 sharing as well. He was right in what he said, I just think you read it the wrong way.
“In another odd bit of synergy, P2P technologies like Bittorrent were developed to make it easier for individuals to share files with millions without having thousands of dollars in bandwidth charges. Of course, these P2P networks became popular ways of trading unauthorized mp3s, software and movies. But now that these systems are in such widespread use, it makes it even easier for open source developers to release a hot new project into the world, even without a fat pipe.”
I wonder where you get the impression that the author is saying bit torrent was intended to help piracy? As a matter of fact, the author implies they were not designed for piracy, by the line
“Of course, these P2P networks BECAME popular ways of trading unauthorized mp3s”
Overall, I great article. Very nice and in depth with historical context.
A few points though. THe author ponders why good, ‘honest’ people decide to pirate software when they wouldn’t do it normally. He then implies its because they feel justified, feeling they are over priced. Sometimes people just like getting stuff for free
I really do think that’s the reason. I know people know its wrong, but generally speaking if a crime is easy to commit, has a net benefit to the criminal, they are not interfacing with their targets, and there is little chance of being caught…people will do the crime. Whether is software piracy, stealing cable, getting free pop from a broken pop machine, paying the plumber by cash to avoid taxes…
Yes, some people take the case that we should just stop trying to prevent this cheating. Others like MS and others are looking towards measures that will make it a bit harder to pirate or make enforcement easier. These too will have an impact.
That said, software is one of the few things you can actually buy from the producer itself. This, I think is the crux of the article. Why can’t I get download the latest Windows straight from MS without support. The same goes for music and what not.
That said, I really don’t think we’ll ever truly get rid of the middle man. We’ll cut down on it, but the retailer is a neccessity. Sometimes people like to browse and don’t really know what they want to buy.
A few points though. THe author ponders why good, ‘honest’ people decide to pirate software when they wouldn’t do it normally. He then implies its because they feel justified, feeling they are over priced. Sometimes people just like getting stuff for free
That is usually the underlying reason, but people who pirate will (from what I have observed) always try to justify it somehow. It’s either the artist/company has enough money anyway, the price is too high, I can’t afford it, or whatever. I don’t think you’ll ever see someone say ‘the reason I steal software/music/movies is because I’m greedy and don’t want to pay for it.’ It’s just like people who commit murder – if you ask them about it, they’ll give you some reason why they felt justified for doing it. (Not trying to put piracy on the same level as murder, but just using it as an analogy.)
For some people it’s a sport to outsmart the developer.
Sometimes they underestimate the intellectual capabilities of
the consumer in a way that almost asks for piracy.Strictly speaken , the average end user has absolutely no feeling
with the abstracts of electronic martians running through a
wire being an mp3.I dare to say that there are far more people
that would think about downloading (illegal) music than steal
something they can physically feel.
People have been taping albums, making compilation tapes for their friends, etc for many a year. I used to rig a tape-deck to my turntable in the days before intergrated hi-fi systems. The internet/P2P has allowed this same concept to happen at a much greater scale, with people (and therefore music) one would normally never encounter. Also the ease of P2P, compared to compiling a tape, makes it an easy, “victimless” crime with no chance of getting caught.
I think the “underlying” factor may be referring to is called Cognitive Dissonance. When people do or think something they don’t feel right about, they will try and “make it better” by using methods such as rationalization, ie. “Stealing is wrong, but copying MP3s isn’t all that bad when you consider how greedy the record companies are.”
I think the reason people copy software/music so much is because there is this feeling that they are not really depriving anyone of anything when they do. If you run up the ‘value’ of the software/music some people have on their computers, it would be shockingly high. If some people can have as much as 100GB of music, that translates to some 25000 odd songs, and really no one is going to spend that much to get all the music in the world whose value decreases with the amount you actualyl have. Really, 25000 mp3s times 4 minutes an mp3 translates to about 100000 minutes of listening, which at 8 hours listening a day would mean you play each one once in 208 days. Yet at the going rate, that collection of music represents an required investment of just under $25000. There is something seriously wrong with the pricing model here.
If for example, they could give you unlimited downloads for a year in exchange for a monthly fee, say $100, you would see more people actually buying music because lets face it, Ther is only so much you can find of other people’s collections, and the quality varies from the very good to the very suspect. If you got 10 million customers you would then have $1 billion in revenue, and the only costs would be bandwidth and equipment as a music seller.
The same could be said for software. If someone could provide a subscription for say $200 p.a. for access to a software bank, and you could download any software from there, you would kill a lot of piracy, at least in the USA for example. The problem is that some people will have $5000 worth of software on their PCs, and there is no way they are going to spend that much. This is where Linux and other solution could fill the void.
But there are some people who prefer to make their abnormal profits, and according to economic theory, these are not sustainable in the long run. Not that they are not trying, they are legislating to create a new class of felonies and classify a whole group of people criminals. Time will tell who will win.
Indeed, the phenomenon is called cognitive dissonance– it’s what happens when observed/expressed behaviour does not fit among the observer’s set of attitudes. Like, when John Smith, a law-abiding citizen downloads and album from the web, the fact that he steals does not fit his “abide-the-law” attitude– therefore he will indeed try to justify his actions, so that his behaviour will match his attitudes and the state of cognitive consistency is reached again.
Yeah, I like my university study of Psychology
And even here people are trying to justify their own actions. Already reached the state of cognitive consistency yet?
In my opinion, downloading illegal music/software is stealing, no matter how you look at it. It’s the fact that one can do it anonymously that makes it so attractive; if you would ask the person who illegally downloads his music to walk into a record store, and steal an album, he probably wouldn’t do it– even though it is the exact same thing.
Talk about it all you want, about prices being too high blabla, it’s still stealing.
And yes, I pay for my music, like everyone should. Just this morning I bought the ‘new’ Beastie Boys album (‘To The 5 Buroughs’) for 13.99E. I do this because it just doesn’t feel right to steal music– whether anyone will know or not.
“Copyright infringement, though immoral, is not morally equivalent to theft of a physical good because infringement does not deprive the owner of his or her possession of the good.”
I haven’t read the whole article yet, so this point may be explained later on, but I have to disagree with this point. Morality is based on logic. The only reason someone possesses something (or more to the point creates something) is because it has/or is expected to produce value. To deprive someone of the possession of an item is to deprive them of something from which they could otherwise derive value. So stealing someone’s wallet (which has money, something with undeniable value, in it) is morally no different from stealing software (from which someone might derive value).
While I agree that pirating software/music/music is technically stealing, I don’t equate that to taking somebody’s wallet, unless you were actually going to buy said software/movies/music.
For example, if someone were to pirate an app that normally costs $500 and there’s no way in hell they could afford to buy it even if they wanted to, what exactly have you deprived the original owner of? Again, I’m not saying it is ok to download stuff you can’t afford, but just drawing a distinction.
The thing that would be great if the developer of software of some IP is that they at least get 50% of the profits instead of like 1 or 2%. They could actually put enough man power into these projects instead of a few people placed on these huge projects and finding themselves doing work at home as well. Would be great to sell software on the internet but for some reason I think their are afraid or something but hey windows xp piracy protection scheme seems to work well enough. Also I was kinda suprised to not hear that people are stealing software becuase they felt like they paid for it already through their isp. Cable and dsl ranges from 30 to 50 bucks a month it is not hard for many broadband users to not pirate anything unless they have some other primary need for broadband like communicating with people overseas or work related things that need a fast connection. Besides pirating and gaming there is no other recreational use for broadband. Say they somehow stop pirating then broadband would almost be useless to the average consumer. Ohhh my webpage will come up faster and I paid 40 bucks for it isn’t going to do it for them.
cognitive dissonance, yeah, that’s skinners theory.
your typical law-abiding citizen can decrease his dissonance that he got from downloading mp3s by
a. building other consonant realtions (“it can’t be that bad, others are downloading too!”) or by
b. changing the value of existing dissonant relations (“it’s not really stealing because i don’t take something away from a person”)
very intersting, and can probably applied here, i agree.
still, there IS a difference between stealing and downloading and it lies exactly in the fact that you don’t actually take things away from someone else. call downloading a crime, if you want. but it’s not stealing. that would be a fundamental definition error.
the other question is: does it really matter? the media industry is undergoing a revolution. it will definitely not be the same 10 years from now. that doesn’t legitimate downloading, but the law is still searching for a way to deal with it (here in europe)
the possibilities of the internet are just too overwhelming for the traditional model of data distribution that has existed for years, decades and even centuries.
after all, this is exactly, what this article is about. and (with the small exception that i thought it’s a bit too long) it is a very good article. congratulations, david!
christian
That broadband piece of yours is of course complete nonsense. I don’t have broadband for downloading– I have broadband because it takes away certain nuiscences like dialing in, pay-per-second and other crap like that. Broadband is about more than just being able to download at high speeds– it’s about not having to worry about costs, and that’s something we all like, don’t we?
I mean, my parents don’t download anything– but they would never move back to dialup.
still, there IS a difference between stealing and downloading and it lies exactly in the fact that you don’t actually take things away from someone else. call downloading a crime, if you want. but it’s not stealing. that would be a fundamental definition error.
I tend to disagree. Of course you take something away from someone! By downloading an song, you won’t buy it, so, you are depriving the owner of the song from income.
Let’s take out another car analogy. What if there was a huge parking lot, in the middle of nowhere, holding thousands of brand spankin’ new Aston Martins, with the doors unlocked. There is no indication or whatsoever that the cars are owned by anyone or anything, and you could easily take one without being noticed.
Would you take an Aston Martin from that parking lot? I hope you won’t, because it’s stealing.
“Locks don’t exist to stop thieves, they exist to keep honest people honest.”
Course, the rest of that becomes a defense of the second ammendment; but that’s a complete aside to this discussion.
A lot of people believe things are only wrong if you get caught. But I think the author is right in that many people do not buy because they see it as a rip off. I’m one of them, I appreciate the idea of buying something over getting a free copy. But I refuse to pay $18 for 40 minutes of music that the artist didn’t even create (no one credits the orchestra that first played Beethoven, but we credit the performer and ignore the writers). I actually view it as a moral wrong to pay too much for a product, or to pay for an inferior product. And to me, supporting those who rip off their customers is a greater wrong than stealing from them. Now usually, I just live without the product, but for others this isn’t always an option. Think of it like stealing from a thief; not like “stealing from the rich.” The moral question is a very hard one, but the legal question is very simple.
With software though, you can easily live without it and you probably shouldn’t use it if you don’t want to pay for it. And the reason is this:
By stealing product X that you hate the producer of, you steal from their competition who makes product Y at possibly a lower price or even free. In software, piracy is damaging to competition.
This is why it angers me to see pirated copies of Windows used to check e-mail. Use Linux or BSD for this, it’s the same price you paid; likely the same effort considering that piracy requires some technical adeptness, and it’s legal!
well, still: if i take one of the cars, that’s one car less, regardless of who it owns. that’s stealing. simple.
if, on the other hand, i walk around with barbara eden (remember her?), see one of the aston martins, point with a finger at it and she does her jeanny-stuff and copies the car, i’d much rather get into it and drive away.
why?
because the huge parking lot, filled with n cars, is still filled with n cars and not with n-1 cars. the owner of the n cars won’t even notice. i, however, screwes aston martin, because i now own a car that i didn’t buy from them.
still. you can’t simply compare taking away 1 car from aston martin and driving around with it to “copying” a car from aston martin, thus _virtually_ decreasing their revenue. in case one, i just stealed a car. in case two, i _might_ have bought that car, but there’s a lot of other things you have to take into account.
so, i insist: copying is not stealing. that’s just what the music industry tells us. and false statements don’t become true just because someone says them often enough. not even in the mediacracy (or mediatorship) we live in nowadays.
christian
Hello,
Good article, but 7 pages!? Come on…
Ignoring the psychology for a moment, I would like to suggest that piracy is, to some extent, a valid economical reaction to corporate market control.
The main opponent of P2P is the RIAA. That’s the Recording Industry Association of America. The what industry? How, in 2004 is recording an industry? DVD writers cost less than $70 for goodness’ sake. I’ll do my own recording thank you very much. And while I’m at it, I’ll take on the cost of distribution too, using P2P and DSL. I can take on the cost of manufacture and distribution. That doesn’t leave much for the “record company” to do (production and marketing). That means they’re due a big slump in turnover and that’s not in any of their interests. So they resist. If they’d just release songs on P2P with adverts tacked on either end, they’d clean up…
With regards to software, I have no illegal software on my machine. I have been offered stuff like Photoshop and Macromedia CashIn(tm) (or whatever their latest thing is) but I have no use for them. Most people have no use for expensive software outside of work. And if you’re earning > $30,000 p.a. from $500 of tax-deductable software, it seems churlish not to cough up. So students learn on unlicensed copies, they’ll need to pay for when they turn pro.
These problems are not as big as the industries would like us to think. The problem for them is that the continued growth they need to survive cannot be sustained if they lose control of the market.
Law is black and white, morality is not.
But I refuse to pay $18 for 40 minutes of music that the artist didn’t even create
Erm, do you know that performing and recording is work? How much time do you think it takes a band like Radiohead (just an example), to create and write the lyrics, the music, then go into the studio, record it, record it again, and again, and again, untill it’s perfect? A 4 minute song does not take 4 minutes to make, you know.
I actually view it as a moral wrong to pay too much for a product, or to pay for an inferior product.
For you it might seem like an inferior or overpriced product, but for someone else it doesn’t! I find paying 60 million euro’s for a painting by Vermeer way too much money for a painting I don’t like, and which is centuries old. Does that suddenly justifies me stealing it? The inferiority or overpriced-ness (nice word, ey?) is completely subjective. You see, I don’t find paying 18$ for a good cd too much, for instance. But I indeed will not pay 18$ for an album I don’t like– but a friend of mine might like it and still pay the 18$ to get it.
And to me, supporting those who rip off their customers is a greater wrong than stealing from them.
Again, a completely subjective matter and therefore not a justification for stealing.
And finally: why is it any different for software?? software, music, toothpaste: they are products. And for products, you pay.
^^^ That should read “RE: Chris”
“In my opinion, downloading illegal music/software is stealing, no matter how you look at it. It’s the fact that one can do it anonymously that makes it so attractive; if you would ask the person who illegally downloads his music to walk into a record store, and steal an album, he probably wouldn’t do it– even though it is the exact same thing. ”
It’s actually more like stealing the CD, burning a copy, and then repackaging it and putting it back on the shelf without anyone noticing. When you download, sure the record company loses money, but the store doesn’t. For them, it’s really no worse than if you had simply shopped at another store.
Well, then we have different attitudes, and therefore, it is useless to dicuss this subject with you
.
But seriously, for me it’s rather simple. It used to be:
Person wants album A. Person goes to shop. Person pays X dollars. Artist/shop/record company/all others involved get X dollars.
Now it’s:
Person wants album A. Person fires up P2P. Person pays 0 dollars. Artist/shop/record company/all others involved get 0 dollars.
That’s deriving people of income, so it’s stealing. It might be a different way of stealing than walking into a shop and get stuff without paying, but it still is stealing. Not paying for something is also stelaing. By not paying your taxes, you steal from the government, for instance. Whether you agree with the way they spend it or not.
Projects like Linux, Apache, PHP, and MySQL were either close enough in quality to their commercial alternatives to be workable, or the commercial alternatives were overkill for the task anyway. Who needs a $7000 Sun server and a $5000 Oracle license for a regional sales intranet anyway?
Nice bit of FUD there. Still trying to push the idea that closed source is bad and open source is the best! everything should be free and we should all live in a free software utopia. Oh and of course its wrong to actually make money off of your work and ideas in a capalistic society. To bad human nature dictates otherwise people pirate software mainly becasue its the path of least alot of people use OSS becasue it is the path of least resistance. The basic truth is that there isn’t anything that it totally free try factoring these points in your arguments of the future.
“For example, if someone were to pirate an app that normally costs $500 and there’s no way in hell they could afford to buy it even if they wanted to, what exactly have you deprived the original owner of? Again, I’m not saying it is ok to download stuff you can’t afford, but just drawing a distinction.”
I don’t see the distinction. If I steal a car off a lot at a Porsche dealer, is that OK? I certainly can’t afford one, and they can make another? They ship quite a few into this country, and the practice of mass production was invented (I think) in the autmobile industry.
Okay, stupid me I got completely wrapped up in a project last wednesday and forgot to get my arse in front of the TV in time for Lost.
Thank goodness a friend of mine has a TiVo. He burnt me a copy of the episode and I watched it.
Did I steal?
What if I had found a P2P download and watched the episode that way? Did I steal?
Every bit of music on my harddrive at home is iTunes or MP3s given away by the artist. (I find 99cents a song the *maximum* I’m willing to pay. [Hell, it should be more like 25 or 50 cents a song given that there’s nothing to manufacture.] If the RIAA thinks I should pay more, I think they can stick it where the sun don’t shine.)
But, say I find an MP3 of something I have on a *record* and download it. Have I stolen? How is this different than me finding some sort of way to rip it to my HD? (At the moment I have no turntable.)
If I find a streaming on-line radio station with a bitrate that doesn’t suck rocks and run wiretap, have I stolen? How is it different than an off the air recording?
What if I use one of those radio-tuners for my computer and run wiretap? Theft? Fair use?
See, the line between theft and fair use isn’t so nice and crisp and clear as some of you would like to think, is it?
—
The only way I buy any new software these days is to take advantage of my academic discount; because when I go to stores and see the prices for things like office and dreamweaver, it’s a total raping of the wallet.
I mean, $1000 for pro-sumer software? Aieee! And what sucks rocks is when you find a friend in the 3rd world can buy the same software for under $250 retail.
Okay so, $1000 or $250 plus the cost of an international money order, and 2 registered mail transactions to receive your “gift” from a friend. Which do you think the savvy consumer does?
And hey, that’s NOT stealing. That’s making the WORLD your marketplace.
Goofed on the title of the post above.
Unfortunately the author is inadvertantly or not propagating the myth of “intellectual property”. This is the myth that ideas can be protected from use. True enough, in the past attempts were made to suppress the widespread knowledge and use of various ideas from time to time, with varying degrees of success. And true enough the same sort of attempts to suppress the widespread knowledge and use of ideas is called “protecting intellectual property” in the current era.
As then, so now, such efforts are intended solely to benefit a few individuals at the expense of society as a whole. They should be opposed vigorously. Patent and copyright were never intended to protect ideas, but rather the tangible expression of ideas, to give the innovative individual the prospect of profitting from his/her “work” for a limited time before everyone else could use it for profit. But the idea itself remained in public domain where others could also express it in other unique ways, ways which could in fact compete with the original implementation. Thus society encouraged an individual to develop new things, works of art, etc, while society as a whole benefitted from their activities.
However, the concept of “intellectual property” works only at cross purposes. It is merely an attempt to subvert the whole notion of encouraging individuals to engage and invent new applications of ideas while benefitting society as a whole in the process. One need only look at the nonsensical software and biotech “patents” which have been granted in the past 20 years that do nothing but prevent others from using the same or similar ideas to produce competing works. Copyright has been subverted to protect the interests of copyright holders decades beyond the death of the original author or artist. None of this benefits society as a whole. Instead, artificial scarcity (ie monopoly) is maintained to the detriment of society.
well, i did agree with you (in both posts) that downloading copyrighted material is not a good thing, i even called it a crime (if it really is, has yet to be decided)
i am just amazed, shocked and bothered each and every day how the modern media controls minds. downloading stuff IS fundamentally different from stealing. the one and only reason why you are using “stealing” here is because, and only because you heard it on the media time and again. it got hammered into your head. it is not real information, in the sense that it contains ANY valuable truth.
you quoted skinner, i’ll quote andreas gruschka (german sociologist): the information and intention of such a message only consists in the fact, that it was information.
i guess we merely have a defintion problem. but really, think about it. you are tricked by a massive mind-making machine. downloading is not stealing just as linux is not communism just as al quaida is not irak.
know your enemies!
christian
Jason: I agree with the original poster. In the example he gave the vendor hasn’t really been deprived of anything – they were never going to sell their product to that individual regardless of whether they pirate it or not. It’s sort of a victimless crime – still a crime, but no-one’s made less by it. Whereas if you steal a Porsche the dealer now has to get another, which ultimately has to be manufactured and paid for.
What this comes down to is that software is free to copy, whereas you can’t copy and paste a Porsche.
And yes, the Model T was the first example of mass production.
Smartpatrol: Calm down. He’s absolutely right in that point – that an Oracle license costing $5000 is overkill for many cases, where mySQL is quite adequate. There are a lot of cases where Oracle will be required over mySQL still.
He didn’t say “open source is good and closed source is bad”, he just said that many free (as in beer) products are good enough to replace commercial alternatives in a lot of instances.
KadyMae: I agree – when you start looking at full retail prices of Windows/Office/etc it’s just ridiculous. Windows XP Pro is about NZ$700, Office is over $1000. This gives you one computer of each – meanwhile students get to pay $200 and get a copy of Office which can be installed on 3 machines.
Imagine if you went to Ford, and they said “Well this Focus is $35,000, but if you can show us your student ID we’ll let you have it for $10,000”. It’s just nonsensical.
I’m not suggesting that students shouldn’t get discounts – I think it’s great we do – but it does go a long way towards explaining why people aren’t too happy about paying the top price for software.
Talking about ripping copyrights, discoveries and so on…how come people in the US keep using the name America to describe the USA, when it was originally given to Cuba, La Espanola (Haiti and Dominican Republic) and Puerto Rico. Did the copyright of this fact expired? Does enyone know where the name America comes from? Hint: Colon’s (aka Columbus) navigator.
As then, so now, such efforts are intended solely to benefit a few individuals at the expense of society as a whole. They should be opposed vigorously.
I couldn’t disagree more! A simple example would be two competing tribes of primitive human’s competing for the same resources in a limited area. One tribe invents a more efficient means of hunting their primary food source perhaps deer. The survival of each tribe/family unit is paramount to the survival of their offspring. What you are saying is that the one tribe should share their method so that they can both deplete the same resource and jeopardize the survival of both tribes. This is basic human instinct to gain the advantage over another competing group of Humans. I do not believe there is anything wrong with that it, yeah it sucks to be in the tribe that can’t hunt as efficiently as the other but you cannot escape this basic fundamental human truth. Hence the reason a free market cannot exist in a true large scale socialist society. There will always be losers in this game and/or a dependency on others for services.
Smartpatrol: Calm down. He’s absolutely right in that point – that an Oracle license costing $5000 is overkill for many cases, where mySQL is quite adequate. There are a lot of cases where Oracle will be required over mySQL still.
He didn’t say “open source is good and closed source is bad”, he just said that many free (as in beer) products are good enough to replace commercial alternatives in a lot of instances.
The problem I have with his assertion is that he did not suggest a cheaper closed source alternative. I agree an Oracle/SUN solution would very well be overkill but a Dell/Microsoft solution? Each case would need careful examination and would never fall under such a blanket statement presented by the author.
And to further build on the whole discrepancy in price it’s like …
Okay, it’s $150 for a student/educator to put it on 3 computers, but $300 for John Q. Public to put it on ONE computer … so what, IF ANYTHING, do these prices have to do with actual cost?
See, when I see that the manufacturer is willing to sell *millions* of licenses to their software at $50/ea, boy oh boy oh boy does that $300 look like NOTHING BUT GREED AND GOUGING.
Because when you consider the fact that this “education” priceing has been going on for about 20 years now, you also question the “loss leader” factor. Loss leaders are short term pricing strategies, not generational.
The cost of software is like the cost of diamonds — artificially created and maintained.
I’d really like to see a no BS accounting of what it costs to create a software package.
I think $50 a license is a reasonable price for Office. It’s not like they’re creating whole swathes of code from scratch any more, so why’s it cost $300?
Suprised you didn’t say something like “what if a household have 2 or more computers”. But come on not everyone can afford 40 bucks a month and then expected to buy something like microsoft office which cost between 200 to 500 bucks depending on what the user needs. Also 50 bucks for a game come on look at espn only charging users 20 bucks for a NEW RELEASED GAME which are great games that can be compared to their EA sports counterparts.
The reason it’s ok for me to steel music is because it’s not hurting anyone. If I didn’t have the option to steel it, I still wouldn’t pay for it. I simply wouldn’t own the music.
I think everyone has it’s own motivations to pirate software/music (or justifications as others might put it
. I admit I pirate music, movies and software. But I also buy. For every product I ‘want’ there’s a balance between convenience, price and quality (value).
I spend at least 200$ a month on music (mostly vinyl because DJ’ing a hobby of mine). DJ’s like to have control over what they listen to. So I don’t listen to the radio much, because I like to make my own playlist and hate to listen to commercials and talking DJ’s all day. So I download a couple of songs I like in addition to the ones I bought, put them in a playlist and let my music player shuffleplay it. That doesn’t mean however that if this all wouldn’t be possible I would go into town and buy full albums of these artists. I just like one song, maybe two. That not worth paying up to 25$ for (that’s what albums cost in Holland), no matter how much you like that artist. But I actually do pay for really good albums.
Actually since I discovered online musicstores I downloaded much less pirated music, just the ones I couldn’t find in the musicstore:)
If I record my own mix made from bought records and put that somewhere on the internet for friends and relatives to listen to, can you call that piracy? I think it’s a grey area. In holland you can subscribe to a license from the so-called BUMA/STEMRA (the dutch equivalent to the US RIAA) to broadcast music over the web. Non-profit organisations and invididuals have to pay 25$ a month to legally allow internet streaming (at a max of 96kbps bitrate). If you allow your users to control what they listen to you’re out of options, because that’s illegal. So streaming is the only option. That just plain sucks. They make it hard for you to make use of new technology in a legal way, so you do it illegally.
About software. I use 95% opensource software. I however like to make music on my pc too. There’s no good quality opensource sequencer out there. So I bought Renoise (it’s like fasttracker but it supports pro features like asio/vst) for like 60$. The virtual instruments I use are mostly free, the commercial ones I use I mostly bought too. Some vst’s I like to ‘try before buy’ so I installed a pirated copy because the vendors don’t supply fullfeatured demo versions. However, all this software runs only on Windows. So as a Linux user I’m out of luck. It’s almost impossible to port this software to Linux, because the VST protocol is proprietary and copyrighted by Steinberg (the creators of the Cubase sequencer, which is way too expensive btw). I’m forced to use Windows (or Mac) for this. I, for one, will never buy software from Microsoft because I don’t like to support a monopoly that locks me in. So I use a pirated copy of Windows. Is that stealing? Maybe, but the motivation for using a pirated copy is morally justified imho and I think many people here would agree.
About movies. Well I would pay for movies if I had the convenience of streaming broadband video, with an uptodate selections of movies and for a decent price. Unfortunately that’s not an option at this moment. So what’s the logical course of action? Launch my browser, click on a torrent and wait for it to come in. Don’t you just love the internet
In addition to ‘leeching’ I frequently visit the cinema.
The problem is that consumers want convenience and they take the ‘lower pricetag’ for granted. I think that for most people price is not the motivation to pirate, except maybe kids who don’t have the money to buy all the software, albums and movies they like.
Internet brings these people convenience. They can just sit back and click around the web. They can easily locate what they want and they download it and put it on a cd to watch or listen to. Eventually the RIAA/MPAA will just HAVE to come up with equally convenient, but legal alternatives to this. And they will become popular (iTunes is the most prominent example of this). Alhough piracy will always remain to exist (as it always has existed), these corporations can earn back their customers (or thieves as they call it) by listening to them and giving them what they want: No stupid DRM restrictions or copy protections, no obsolete portable media, but internet distribution, no confusing produkt activation sequences. Consumers just want convenience. Period.
I see some justification here. Im being a big Ska fan. It’s quite unpopular genre, so finding anything good in Poland is next to inpossible. Sure, Im buying one, two CD’s per 3 months because I can’t simply get most of the old bands. So, from time to time Im downloading some old, Jamajcan Ska and enjoy good music. That’s my excusse numer one. For my second act, I’d like to say: testing. Few of my friends are downloading some mp3 from album and after they decite if it’s any good, they are going for shopping. So, they are buying anyhow, and if music sucks, they wouldn’t buy anyway. So noone looses. I don’t download movies. It take ages (even on decent connection) and effect you’ll recive is nothing to be compared with cinema. Plus I can go with my girlfriend, drink a caffee, watch a movie and then go for a beer and disscuss what I saw. 🙂
Nice story but you’re missing the point. If it was really just about “survival of the selfish” human beings would have gone extinct thousands of years ago. Patent and copyright theory and law is an order of magnitude or more removed from one hunter discovering a better stalking technique and keeping it to himself.
Society, in the form of laws, grants a limited monopoly to the inventor/artist to exploit his/her “work” for personal profit. Society does this to encourage the individual to develop ideas into new and useful “works” that will be of benefit to society as well as profitable to the individual. It is to the greater benefit of society that such monopoly be limited because someone else may come up with a better way to do it, that is cheaper, more efficient, more environmentally friendly, etc. Thus society takes away the monopoly as it deems most useful to its larger goals.
The real issue I am trying to make is that by granting monopoly rights to an idea (rather than specific “works”), society shoots itself in the foot because it thereby prevents other innovative individuals from developing alternative “works” that might be better than the original patented/copyright work.
Okay, but a Microsoft solution would be SQL Server (Access being, well, hopeless) which still costs a couple of thousand? I’m not totally up on the pricing of it but that’s still that couple of thousand more than mySQL.
And I think the article basically was talking about open source at that point – the point being that if there is a free alternative people feel less happy about paying money for the commercial one, even if it has advantages.
Agreeing again… if they can afford to sell Office for $150 to students, why does it cost so much more for everyone else?
And yes, why is it so damn expensive? Every two years they add a few bits, and oh look, hundreds of dollars again.
Meanwhile if you want to buy say a game, it costs US$50. The whole thing had to be written from scratch (or the engine licensed, in which case that cost has to be recovered). Then if it’s something like Diablo 2, it sells five million copies at that price – compared to Office’s 100 million or so? What happened to supply and demand?
And frankly I find it hard to believe that Office is harder to code – you don’t need artists or modellers either (except for the Excel easter eggs).
Microsoft are very clever with their pricing and marketing though. The student licenses are sold with the sole purpose of making the brand ubiquitous (something Bill G is very big on). Then you buy a full copy of Office – after that you can upgrade, so you also received some sort of intangible “office user” asset that you’ll be ‘wasting’ if you don’t buy the next version.
Or there’s Windows – XP Home is basically XP Pro with bits cut out. Despite what they advertise, they clearly didn’t write it that way then add functionality for Pro. So if anything there’s more work involved for Home – but it’s more like half the price.
The reason for that is simple – they think it’s all home users need, and it gets the brand out there. Whereas they can make money off businesses who have to buy Pro, and also can afford to buy it.
As you say, this cost must be artificially maintained – open source software, which is often available free, has become a viable alternative. Companies are making money off it. So if OpenOffice can work as a free product, why does MS Office have to remain so expensive?
The real issue I am trying to make is that by granting monopoly rights to an idea (rather than specific “works”), society shoots itself in the foot because it thereby prevents other innovative individuals from developing alternative “works” that might be better than the original patented/copyright work.
yes but i think is incorrect to assume that and individual idea owner monoply or not somehow owes “society”. If i invent a cold fusion process and keep it to myself thats my right to do so, i owe society nothing. I wouldn’t of course becasue i am too nice of a guy to keep something like that to myself.
Okay, but a Microsoft solution would be SQL Server (Access being, well, hopeless) which still costs a couple of thousand? I’m not totally up on the pricing of it but that’s still that couple of thousand more than mySQL.
I understand what you are saying but as far as pricing with support we are talking apples and apples. Its a much used misguided argument that running an OSS solution is costless. It is just not the case hence the reason I branded the authors statement FUD.
hello all,
just to say why I dl music for free – maybe 90% of my music is p2p downloaded. Why do I download all these songs? Because it’s fancy to have 20-30gb of music… and it helps me find some music which I wouldn’t have found any other way… Although I pay for all my software…
Just my 2 cents
It’s a double edged sword. In the music scene p2p has allowed for consumers to get access and hear much more music than the regular media outlets would allow. This has lead to an increase of sales consistantly from the introduction of Napster onwards. What is pissing the main record labels off is that it is not mainstream music that has seen the benefits of this music access, it has been the smaller labels and independents.
You check the industry revenue and you’ll see it in black and white a steady increase in revenue over the last 6 to 7 years. Audio piracy issues relate more to that of market control. The big wigs want to clamp down on who gets to play and distribute what music. This the public can not allow at any cost as it will lead to a very staid industry with music void of any form of artistry at all.
Now on the software side, either you pay for what you use by buying it from the shelf/subscribing to it/or donate funds to the developers who contribute to the code you use. Don’t shaft people who create. I actually hope MS (who has a history of allowing piracy and now is trying to create revenue of the pirated software dependence they have generated) is successful in cracking down on piracy as it will drive people to alternatives. What I don’t like is the big wigs of the media industry trying to lockdown the capabilities of PC’s in the name of preventing piracy. As soon as you do that millions of creative artists will be shafted as the hardware needed to create as an alternative to PC’s will become out of their reach. I know what it’s like as a musician trying to get a studio together and be able to create legally. If I had to purchase DRM free audio workstations from a proprietry hardware vendor, I couldn’t do it. I don’t have the financial resources to do it and I’m sure I’m not the only one.
Whilst in the capitalist systems, folks can millions or even billions, meanwhile people are sleeping on the streets, starving in 3rd world countries, dying of various diseases because they can’t get medical aid, etc. So you say stealing is wrong, but hoarding money isn’t? I’m no communist, but really now if you encourage a dog-eat-dog mentality in people, expect it to come back to bite you in the @$$ whether you be the RIAA, Hollywood, Bill Gates or just the ordinary schmo on the streets. Don’t like theft? Make a world where everybody has whatever they want or need…or learn to live with disappointment. Isn’t the basic premise of our economic system that there is no good and evil, only winners and losers?
>>yes but i think is incorrect to assume that and individual idea owner monoply or not somehow owes “society”. If i invent a cold fusion process and keep it to myself thats my right to do so, i owe society nothing. I wouldn’t of course becasue i am too nice of a guy to keep something like that to myself.<<
Many people think they don’t owe society. So society forces them to cooperate by limiting the monopoly. As originally thought out and implemented, patent and copyright law were quite ingenious in persuading innovative people to share their innovations with society at large.
People like Franklin and Jefferson did not assume that individual inventors would feel like they owed society. But “society” in fact provides the environment, education, tools, and the market from which to make a profit. Only a man living alone on a desert island or the remotest north woods is truly a society unto himself. The rest of us owe a great deal to the social environment in which we are born and raised whether you want ot admit or not. And I agree, if you have a great idea and don’t want to share it with anyone you will take it to the grave with you.
The cost of software is like the cost of diamonds — artificially created and maintained.
Your first post was interesting, but the above sentence is false. Demand and Supply usually determine prices, and the theory explains the differences of diamonds and water prices perfectly.
The method just don’t works for goods with margin costs of zero for additional usage: Busses, Cars, Planes, Radio Stations are nice examples (within their capacity). It doesn’t matter if there’s one more consumer, and thus free riding happens. The problem is that all the free-riding usually makes the service a loss. Thus, nobody would usually be interested in providing it without additional rules.
Demand and Supply usually determine prices, and the theory explains the differences of diamonds and water prices perfectly.>>
The key being “usually” determine prices.
DeBeers controls sales on 2/3 of the world’s Diamonds. At fixed times the each year they offer “sight holders” an opportunity to buy diamonds. The prices and quantity are fixed and non-negotiable.
—
There’s also
http://www.straightdope.com/columns/040903.html
and
http://www.shaneco.com/jewelry/debeers.asp
Diamonds cost what they do because DeBeers says they cost that much.
Congrats for an excellent article! I would also recommend it as worthwhile reading for people like business and It managers & students too.
I would like to add to this discusion one thing that many readers of this site (with well-paid IT jobs) may not quite get: One of the main reasons for global software piracy is the simpole fact that commercial and proprietary software may just cost all to much to most people in this world.
We may even consider the rich western countries only, where people like students, the unemployed, or people just not having well paid jobs but lots of expenses instead, often just cannot afford to pay for something like an official copy of Microsoft Office. Luckily at least students may get cheaper student prices in some countries but not everywhere.
What can those thousands of people do to keep up with the personal computing and Internet revolution of the recent decade? Also, keep in mind that keeping up with the IT development is also more and more necessary especially in the rich western world in oder to maintain one’s work competence, to pay the bills online (encouraged by the banks more and more too) etc. Often the only way to solve the problem is to get a pirated copy of MS Windows (and/or MS Office etc.) from a friend or a relative.
It is much cheaper to get old PC hardware than official versions of, for example, MS Windows and MS Office. In fact, it’s perfectly legal and acceptable to get or donate a free PC with all possible hardware and peripherals. But – with all the legal mumbo jumbo of commercial software licenses – it’s much more problematic even to know what might be acceptable copying, donating etc. of some commercial software, according to that legal mumbo jumbo, and what not.
Fortunately we have Open Office and other free alternatives now, but alternative operating systems (to Windows, and to some degree Mac OS) seem to be a bit too difficult choices still for the mainstream like home users – whether they’ve money to buy a legal copy of MS Windows or not.
At the end of the day does it really matter where this fine line between copying/piracy/stealing is. Me personally, I think it’s morally wrong. But IMHO, the law is not meant to enforce morality, but to ensure we all get along somehow.
I think if we step back a bit and ignore morality for a second, we can ask ourselves one simple question.
Are those invovled in the production of a digital item being paid proper compensation on the whole. This in the end will determine which direction software takes.
Maybe we are a crossroads right now where too many people are not paying for the digital items. But last I checked artists are still making loads of money, games are still being made, movies are still raking in millions, microsoft is still making loads of money… Business will still need legal software and this law and order WILL spread to those other countries in time. People are often spontaneous and WILL rent a movie/game from blockbuster rather than spending 4 hours searching/downloading it.
Especially with executables, I often don’t ‘trust’ downloaded content and often buy them. I personally find the ‘fake’ media items on p2p software (you know the songs iwth the right name, but end up just playing the chorus with a scratch on it) is really an effective way to ensure everything works accordingly. I don’t even search for any song I think could possibly be on the radio because I’ll have to sort through 10 fake ones first. Whatever the morality of that, it works, and keeps everything in balance.
So as a Linux user I’m out of luck. It’s almost impossible to port this software to Linux, because the VST protocol is proprietary and copyrighted by Steinberg (the creators of the Cubase sequencer, which is way too expensive btw). I’m forced to use Windows (or Mac) for this.
That’s not true. VST and VSTi modules are very easy to port and supported on all major OS’s (even BeOS). The main problem in that case is that most of them are closed source. Even most of the free ones are closed.
Some developers are happy to share the source with another developer that will port it for him, while some aren’t. And commersial developers doesn’t care about any other platforms than Win and OSX at the moment.
But technically, it’s no problem at all. So the good thing is that if/when linux grows as a music creation platform companies will easily be able to port their VST and VSTi modules. But it’s not really there yet, if it will ever be.
Making music is the only thing I use Windows for these days. And I don’t like it. But the only realistic option is a mac, and it’s way too expensive.
I feel the same about supporting MS. I’ll never pay for any MS software. But my Win2K install is actually legit, I got it for free.
What most people doesn’t realise when they say that they won’t pay for Windows because they don’t want to support MS, but still uses Windows, is that they are actually supporting MS anyway. Especially if they are buying software made for Windows.
It helps MS to maintain their place in the market and it hurts the growth of the competetors.
This is something that bugs me a lot. But for music making at a low budget there aren’t really any realistic competetors to support yet. When there is, I will jump right at it.
For example, the complexity of the Oracle database and the amount of man-hours that has gone into its creation is probably less than that of the Windows operating system, but it costs a hundred times more. Lucky for Bill Gates, there’s a demand for a much higher quantity of Windows licenses. I guess that’s why he’s more than twice as rich as Larry Ellison.
What kind of an argument is that?
If my memory serves me correctly, it was actually some form of gun that was assembled on an assembly line like cars are, though not nearly as complicated to manufacture.
But then, if we want to break things down more, there are more ordinary items that were first made on assembly lines, such as cloth, and perhaps furniture for the common person, though I can’t give a year for that.
One thing I’ve not seen mentioned in either the article or all the preceding comments to this one (58 as of the time I wrote this) is the amount of time and effort required by a creator of software to learn and master their trade sufficiently well to create the product. I find it curious that many people will insist that software should/must be free, simply because it costs nothing to distribute (or very close to it) and yet, if you ask them to do some sort of labor or provide the time/effort to instruct you in something of their expertise, they’ll quickly complain that they had to work hard to get/learn/earn that, and they’ll say no, there’s no such thing as a free lunch!
Now, if societies that have the infrastructure to support software development actually paid some sort of stipend to software developers that produce software that the public sees as having value, then by simple logic, there’d be nothing wrong with people profiting off the work of the developer(s), as the developer(s) would be assured of some form of compensation that allowed them to pay for minor things like food, water, fuel, shelter, and perhaps a few nice things. How that stipend would be calculated would be an interesting discussion unto itself, but perhaps something agreeable to the society and the developers could be worked out, based on experience/skill/quality of the works, combined with some assessed value for fitness of use for one or more tasks the software is designed for. To some small degree, this is where some people are getting a small amount of income from people making PayPal donations to support the development of software, but entirely on the honor system, which doesn’t appear to ensure nearly enough income to depend on someone making a living off of.
The university I attend (IUPUI) assesses a “Technology Fee” (I think I’ve got it correctly named) for the usage of the IT infrastructure, which is assessed each semester for all students. For a long time, I saw no value in paying that fee, as I had all the IT infrastructure I wanted/needed at home. However, as of this time, I’m finally recouping the fees in terms of value, by using the dialup account I had available, as opposed to using some horrible “free” (advertising supported) ISP, or some other provider (note: I’m currently severely underemployed, and I might argue it is related to the whole article attached to these comments) and though it isn’t ideal for many things (certain ports are blocked, for example) it is of enough value in a crunch.
“..alot of people use OSS because it is the path of least resistance…”
Least resistance?!? Do you have any idea how long it took me to get Debian installed on my laptop? 🙂
greg
One thing I’ve not seen mentioned in either the article or all the preceding comments to this one (58 as of the time I wrote this) is the amount of time and effort required by a creator of software to learn and master their trade sufficiently well to create the product.
That’s self investment, as it is when you attend University
or whatever institute.As opposed to research.
If someone called the BSA and said my company dident pay any licenses, it would be true (except for some zend licenses). Open Source software has served us well, but it somehow still baffles people i talk to in the industry, that you can live without Microsoft, Oracle and IBM Software + various industry dependent software.
I think the “underlying” factor may be referring to is called Cognitive Dissonance. When people do or think something they don’t feel right about, they will try and “make it better” by using methods such as rationalization, ie. “Stealing is wrong, but copying MP3s isn’t all that bad when you consider how greedy the record companies are.”
Or they may have simply not been brainwashed with the “copying == stealing” line.
Making the copies is not stealing it’s what you do with the copies that count.
For example if Syria sends a spy to Israel and copies information about the location of a research facility. Then Syria sends a missile attack against the facility.
The copying is not wrong. It is the misuse of the copy that is wrong. If having a copy stops you from buying a copy then that is where the crime lies. However since we have no real name for such a crime the industries use stealing as a name, but we know that it is not really stealing. It is another crime altogether.
Also morality comes not from logic but instead from ethics.
Indeed, the phenomenon is called cognitive dissonance– it’s what happens when observed/expressed behaviour does not fit among the observer’s set of attitudes. Like, when John Smith, a law-abiding citizen downloads and album from the web, the fact that he steals does not fit his “abide-the-law” attitude– therefore he will indeed try to justify his actions, so that his behaviour will match his attitudes and the state of cognitive consistency is reached again.
Yeah, I like my university study of Psychology
Maybe you should recall your “correlation != causation” principle. Just because someone “obeys the law” except for a single incident does not mean their behaviour is *dictated* by the law – so “breaking” a law may not necessarily be against that person’s morals.
In my opinion, downloading illegal music/software is stealing, no matter how you look at it.
It’s not stealing, it’s copying. There is a _vast_ gulf between the two in both practice and principle.
I tend to disagree. Of course you take something away from someone! By downloading an song, you won’t buy it, so, you are depriving the owner of the song from income.
No. You’ve only “deprived” the “owner” of the song of income IFF you would have otherwise bought the song.
Would you take an Aston Martin from that parking lot? I hope you won’t, because it’s stealing.
Of course not. However, if I could whip out my Star Trek replicator and make a complete and perfect *copy* of one of those Aston Martins, I would.
The difference between “copying” and “stealing” is that in the case of the latter a direct and tangible loss is suffered. In the case of the former there is only the intangible possibility of not gaining something to lose.
Erm, do you know that performing and recording is work? How much time do you think it takes a band like Radiohead (just an example), to create and write the lyrics, the music, then go into the studio, record it, record it again, and again, and again, untill it’s perfect? A 4 minute song does not take 4 minutes to make, you know.
The real question is why do you think Radiohead should be paid over and over and over again for that one bit of work, including their descendants for 3 or 4 generations ? Most of the working world only gets paid *when they actually do the work* – why should “artists” be any different ?
Morality is based on logic.
Morality is not in any way, shape or form based on logic. Morality is a construct of society. The principles behind logic are objective and defined, the principles behind morality are subjective and constantly changing.
The only reason someone possesses something (or more to the point creates something) is because it has/or is expected to produce value. To deprive someone of the possession of an item is to deprive them of something from which they could otherwise derive value. So stealing someone’s wallet (which has money, something with undeniable value, in it) is morally no different from stealing software (from which someone might derive value).
But they _are_ completely different things, for the very reason you state. In one case, you are stealing something that *definitely* has value (ie: money). In the other, you are copying something that *might* have value.
In other words, in the first case there is direct and tangible loss, in the second case there is not – you can’t lose something you never had.
One tribe invents a more efficient means of hunting their primary food source perhaps deer. The survival of each tribe/family unit is paramount to the survival of their offspring. What you are saying is that the one tribe should share their method so that they can both deplete the same resource and jeopardize the survival of both tribes.
No, he’s saying that should the other tribe find out this method (or simply discover it themselves), *they* haven’t done anything wrong.
Hence the reason a free market cannot exist in a true large scale socialist society. There will always be losers in this game and/or a dependency on others for services.
The objective of copyright is impose *artificial scarcity*. It subverts the principals of capitalism.
yes but i think is incorrect to assume that and individual idea owner monoply or not somehow owes “society”.
But they do. Society provides the infrastructure (food, shelter, protection) that allows them to spend time just thinking up ideas instead of worrying about basic survival.
Okay, it’s $150 for a student/educator to put it on 3 computers, but $300 for John Q. Public to put it on ONE computer … so what, IF ANYTHING, do these prices have to do with actual cost?
Absolutely nothing, the same thing _any_ price does in a free market system.
I think $50 a license is a reasonable price for Office. It’s not like they’re creating whole swathes of code from scratch any more, so why’s it cost $300?
Because that’s what the market will bear. You think the raw materials in a Ferrari cost anywhere near as much as the selling price ?
Not to mention, Office does tend to increase in functionality reasonably significant with each new release.
The real question is why do you think Radiohead should be paid over and over and over again for that one bit of work, including their descendants for 3 or 4 generations ? Most of the working world only gets paid *when they actually do the work* – why should “artists” be any different ?
It’s in generall protected for about 25 years.After that they have to release the same again to get a new cycle going.
The major losers from P2P and massive copyright infringers are those businesses who have built themselves up on the basis of copying being difficult and time consuming. Now that copying is simple and quick, their business models are obselete. It’s no different (to use the ubquitous example) to the car manufacturers obseleting buggy-whip manufacturers.
Why should obselete business models be protected by law ?
It’s in generall protected for about 25 years.After that they have to release the same again to get a new cycle going.
In most countries (where copyright is respected at all), a work is copyrighted for 70 years *after* the death of the copyright holder.
So that Radiohead album you buy today won’t be in the Public Domain for at least ~100 years and for that time, Radiohead and their descendants are able to make money from that album.
How on Earth does this system encourage Radiohead to create more work ? Their great-great-great-grandchildren will still be able to make money from their albums. Where’s the incentive ?
There is no justification whatsoever for copyright lasting beyond the death of the copyright holder.
I’m pretty sure Australia uses 25 years – check out Project Gutenberg, they have a bunch of e-books available which are in the public domain. They’re working on 25 years after the author’s death.
I’m pretty sure Australia uses 25 years – check out Project Gutenberg, they have a bunch of e-books available which are in the public domain. They’re working on 25 years after the author’s death.
According to this:
http://www.copyright.org.au/PDF/InfoSheets/G010.pdf
The general case is currently 50 years after the author’s death, extending to 70 years (thanks to the AUS-US FTA) at the end of this year.
However, this is really semantics. My point is copyright should expire well within the creator’s lifetime, not well after it.
Incidentally, where in NZ do you live ?
DeBeers controls sales on 2/3 of the world’s Diamonds.
Sorry, I thought you were referring as to the diamonds / water prices ‘puzzle’, not to DeBeers monopoly position.
However, a monopoly position is no contrast to the ‘demand and supply determine prices’ theory – in fact, it’s quite the opposite.
if we had unlimited amounts of power and quantum combiners on every street corner so that anyone could go up to them and just push a button to get a hot cup of coffe, a new set of pants or the latest from some composer then the composer to can do that and dont have to get payed for his work. basicly the sole reason for our need for money (be it physical or electronic) is the fact that we have limited resources. and as long as we have limited resources a resource have a value. but outside of the act of creating software, a work of art or similar technology today makes images, strings of code and sounds basicly a unlimited resource, thereby turning the value into 0 quite fast ones its out in the wild. only by applying the virtual limitation of intelectual property does the value stay above 0. but remeber that any physical item loose value with use and shelf life. this forces the creators of said items into makeing new ones. but virtual goods have a unlimited shelf life and therefor have no real need for being renewed. the original creators of the idea “intelectual property” did see this and put in a timer. the problem is that this timer have gone the wrong way. in this modern age it should have been tuned short as the time it takes to make a new product is shorter, but with pressure from the special interest groups its instead become longer so that it basicly overlaps. if the special interest groups got it how they wanted there would be no timelimit and they would become a kind of printing press or black hole for money if they allso could apply dark age tactics to get people to pay up. basicly there is a creation of a new kind of aristocrasy going on, one fuled not by blodline but by money (or one could in fact state that it was allways fueld by money but now the idea of inheritance have been ripped out). basicly this time the war is not fought by soldiers and generals but by lawyers and marketers. the only kind of job that have crossed over intact is the spy.
If I hear most people here, it seems to me that most of you wish that music was freely available and that no one ever would have to pay for it again.
Now, it’s my strong belief that Aston Martins should be freely available, that no one would ever have to pay for one again.
Quote myself:
“One thing I’ve not seen mentioned in either the article or all the preceding comments to this one (58 as of the time I wrote this) is the amount of time and effort required by a creator of software to learn and master their trade sufficiently well to create the product.”
Jophn Deo said:
“That’s self investment, as it is when you attend University
or whatever institute.As opposed to research.”
I won’t argue that it isn’t self-investment. It IS personally-directed research, regardless of how “scientific” it is. It involves real risk that what is studied won’t be valuable to anyone else, or even themselves. A lot of the development of software can clearly be considered research, as it isn’t possible to know immediately how to accomplish/implement something the first time. Also, even if it is known how to implement it, needs aren’t always clear, or static: this requires (for great software, anyway, that actually has longer lasting value) some research into the target audience and their needs with appropriate interaction. Software designed without that feedback has a tendency to not be used by anyone but the original creators.
What I wanted to get across is that that self-investment/research is not significantly different than the same sort of self-investment/research required of a doctor or a lawyer that wishes to remain competent/employable in their respective fields: it takes TIME, ENERGY, MONEY expended to accomplish all of this. This is where the big schizm between what people think the value of software creations (once created) should be and what they are considered to be worth: they can’t afford to be completely free, because that ignores the reality that a real human with real human limitations of time, energy, resources, etc. put their time and effort into accomplishing it. People don’t truly expect to keep on going to a doctor for many hours each week and getting their services for free, and we know lawyers aren’t cheap or free (if you aren’t destitute and the government doesn’t appoint one for you, courtesy of the taxpayers, which still isn’t truly “free”) because the cost of their investment in themselves needs to be recuperated, not to mention the fact that if they don’t get sufficient remuneration, they will be incapable of providing any more service: they need food, shelter, clothing, etc. to survive. Software engineers are humans with exactly the same mortal needs, and this is what is clearly forgotten!
I did not believe that OSNews was still capable of articles of this quality. Great stuff.
Bobby
“One thing I’ve not seen mentioned in either the article or all the preceding comments to this one (58 as of the time I wrote this) is the amount of time and effort required by a creator of software to learn and master their trade sufficiently well to create the product.”
This is indeed a good point, and it’s one of the reasons why music, software, movies or anything else should never be free (gratis) unless the creator wants it that way. There are many reasons why a creator of a virtual good might want to give it away for free, and they should be free to do so. But the truth is, no matter what happens, all these kinds of goods will always have some production cost involved, whether it’s education, hardware, or just office space.
And there isn’t anything wrong with the creators of software, music, or whatever having the hope of really hitting the jackpot with one of their works. That one of these days one of their programs or songs will become really popular and make them a lot of money, even a disproportionate amount compared to the amount of work it was to create it. And that’s because 1) I believe in a free market where people have the right to create goods and sell them without some authoritarian regime judging what is a fair return on their investment (and pocketing the rest, of course) and 2) because trying to make a living in the music or the software business is hard, thankless work, and most of the people who try, fail.
All those people plugging away in order to try to hit the big time, motivated by that dream, has always been the primary engine of the world’s innovation and economic development. If there isn’t that possibility of wild success, not as many people would end up trying, not as many people would endure the initial hardships.
Therefore, even though I recognize in this article that the IP-based businesses are bogged down by obsolete layers of middlemen and the struggle to maintain the old order will only damage its long term viability, I still think that in order for this system to work, there must remain a way for creators to be rewarded for their work, and to have the possibility to be rewarded far, far beyond their input in those rare cases where the work is desired by many people.
The ‘abnormal’ situation isn’t the copying of information but rather the looking at it as a good. You cannot prevent th copying of information (wether it’s music, a painting or source code) because of the very nature of the thing.
Every time I look at a picture or hear a piece of music it gets copied into my internal memory. People intuitively understand the nature of information which is why it doesn’t ‘feel’ wrong to copy a song, the rationalization is treating it as a good which imposes sociatal values on something where for reasons of practicality it doesn’t apply.
Note that this dichotomy is relatively new and only really came to the fore in the latter half of the last century. The classic view of information (that it is to be distributed freely) survives in institutions like libraries where you can freely access cds, books and yes even software.
Very good to the point, it’s hard to bend your view.
But i’m not going to, in fact i can agree with a lot you said.It’s sad though that in some countries justice is somewhat inherent to depth of the pockets.As the good lawyers aren’t cheap,and the cheap ones have more often to
much cases but that’s a different story.
1) I believe in a free market where people have the right to create goods and sell them without some authoritarian regime judging what is a fair return on their investment (and pocketing the rest, of course)
I agree, that is why i cannot understand the mentality that is applied to Microsoft. They did just that and were punished for their success by various governments.
its not the success the try to punish, but the way they did it. every system have rules, and if you break those rules then punishment is the reaction. the only way for a market to grow is open competition where the curstomer can go from supplyer a to supplyer be if b have a better product. this without worrying about filetypes and similar. interoperability and standards are the name of the game. and im not talking about de-facto standards but real standards that are not owned by any one entity…
If I hear most people here, it seems to me that most of you wish that music was freely available and that no one ever would have to pay for it again.
Now, it’s my strong belief that Aston Martins should be freely available, that no one would ever have to pay for one again.
Still haven’t figured out the difference between physical objects and legal constructs, eh ?
If a performer wants to perform somewhere and charge me a fee to see/hear them, I have no problem whatsoever with that. I would never suggest that they should have to perform for free.