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Economic Disadvantage Of Closed-source S/w


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#1 masi

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Posted 22 August 2006 - 11:05 PM

Hello,
I just wanted to get the readers' opinion on 10 slides:

Brief Analysis And Generalisation of Closed-Source Software Business Models to All Maximum Profit Based Businesses

url:
http://www.archive.o...rty/slide1.html

Thx,
Masi

#2 Sip

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Posted 22 August 2006 - 11:27 PM

The goal to "prove" the ethical problem with closed-source software presented in the slides suffers from three major flaws in the assumptions it makes:

1. It assumes software is a static entity and that once it is written, it is a "product". Actually, in my opinion, most modern software continuously evolve and change in time to first correct that which should have been correct to begin with, and second, to "upgrade" and patch it with new features and additions to address arising consumer demands.

2. It assumes the cost to write good software ($x) is low compared to the profits $z. I would argue that even though replication costs are essentially "0", most large businesses have to sell a lot of copies to recover their initial investments into writing the software (and the upkeep - see #1).

3. It neglects to account for piracy. The "0" cost of replicating the product also has the inherent result that the software will inevitably be replicated by unauthorized entities. The company either has to spend a lot of money to counter such efforts or to absorb that cost into it's $z (or $y or $x).


The rest of the discussions are interesting but I think they do not address these problems with the thesis. Of course these are all generalizations (as the title also states) so one could come up with specific cases where each of these assumptions falls apart. But in general, the slides did not convince me that closed-source business models have any inherent "ethical" problems just because the replication costs of each additional product is "0".




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