free-world.html (9904B)
1 <!--#include virtual="/server/header.html" --> 2 <!-- Parent-Version: 1.96 --> 3 <!-- This page is derived from /server/standards/boilerplate.html --> 4 <!--#set var="TAGS" value="thirdparty" --> 5 <!--#set var="DISABLE_TOP_ADDENDUM" value="yes" --> 6 <title>Only the Free World Can Stand Up to Microsoft 7 - GNU Project - Free Software Foundation</title> 8 <!--#include virtual="/philosophy/po/free-world.translist" --> 9 <!--#include virtual="/server/banner.html" --> 10 <!--#include virtual="/philosophy/ph-breadcrumb.html" --> 11 <!--GNUN: OUT-OF-DATE NOTICE--> 12 <!--#include virtual="/server/top-addendum.html" --> 13 <div class="article reduced-width"> 14 <h2>Only the Free World Can Stand Up to Microsoft</h2> 15 16 <address class="byline">by Tom Hull</address> 17 18 <ol> 19 <li>The reproduction and distribution cost of software is zero at 20 the margin. This means that in theory it is no more 21 expensive to produce software which can be freely distributed and 22 used by everybody than it is to produce software for a limited 23 clientele.</li> 24 <li>The pricing of software bears no relationship to the cost of its 25 development. The two factors that do matter are market size (which 26 is limited by price and utility) and competition. Given a market 27 for a software product, the maximum margin can be obtained by 28 precluding or eliminating competition.</li> 29 <li>Software companies that are able to thwart competition attain 30 pinnacles of power which are inconceivable in other industries. 31 Partly this is due to the enormous cash flows that are possible in the 32 absence of competition from products with nil reproduction costs, but 33 largely it is due to the complexity of software itself, which allows 34 dominant companies to design “standards” which exclude 35 future competition.</li> 36 <li>All niche markets for software rapidly evolve toward monopoly or 37 an equilibrium where a small number of players tacitly agree not 38 to mutually destroy their profits. (Established companies can 39 defend their market share by reducing their prices to practically 40 nothing, making price competition suicidal for newcomers.) However, 41 there are cases of asymmetrical competition, where a large company 42 with other sources of income can destroy a smaller company that 43 depends on a single niche revenue stream.</li> 44 <li>Microsoft has a secure revenue stream based on its dominant 45 position in personal computer operating systems software, and uses the 46 power inherent in that position to favor its other business activities 47 with its ability to dictate “standards” and to undermine 48 competition, especially where power (as opposed to mere money) is at 49 stake.</li> 50 <li>Capitalists invest in new software ventures with the hope of 51 gaining a dominant position in a new niche market. There is 52 essentially no new investment in existing niche markets, since it 53 is impossible to compete with an established dominant player on 54 the basis of lower costs and the possible gains of an uphill 55 battle for a small share of a shrinking pie rarely justify the 56 risks. In their wildest dreams these capitalists want nothing so 57 much as to be just like Microsoft.</li> 58 <li>The drive to restrain Microsoft under the rubric of antitrust law 59 seems mostly to be the effort of companies who find their own power 60 positions threatened by Microsoft's activities. They seek to make 61 it harder for Microsoft to undermine their own businesses. However, 62 they are fundamentally similar to Microsoft in that they don't 63 question a world where technology companies working from private 64 caches of intellectual property are able to control the use of that 65 technology for their own best profit.</li> 66 <li>In the market equation, demand is equal to, and in many ways the 67 master of, production. Yet in the world we live in, production is 68 highly organized and efficient and commands enormous financial 69 resources and seductive powers of persuasion, while demand is 70 fragmented, uninformed, and powerless. While consumers can still kill 71 a product that they have no desire for, they are nearly powerless to 72 direct or even influence the detailed designs of those products. For 73 software products, consumers can only choose among a given set of 74 alternatives, which are extremely complex, dauntingly impenetrable, 75 and generally designed more for the company's anticompetitive purposes 76 than for the user's tasks. (Even the old fashioned option of doing 77 without is often impossible due to the intricate web of 78 interdependencies as new hardware and software march in lock step into 79 the future.)</li> 80 <li>The real “killer software” is free software: software 81 that is free of intellectual property claims; that is published in 82 source code form, so can be inspected, evaluated, fixed and enhanced 83 by anyone with a mind to do so; that is freely distributed and can be 84 installed on machines and used without limit. Free software is the 85 software that kills the closed, nefarious software product 86 industry. It is software that users can select intelligently, to do 87 today's tasks, and which they can collaboratively build on to handle 88 future needs. Free software is the one thing that not even Microsoft 89 can compete with.</li> 90 <li>Still, there is one core problem: who pays for developing free 91 software? The usual answer—which leads to all of the trouble 92 above—is that investors pay for development, which they 93 recover from their profits. The only real answer is that development 94 costs must be paid for by users. The key point here is that what is 95 paid for is not the distribution or use of the software, but its 96 development, and that the development of free software implies that it 97 can be used by anyone. I think there is a simple way to handle this: 98 anyone who wants a piece of software developed or enhanced posts a 99 “request-for-proposal,” including a sum that the requester 100 is willing to contribute towards its development. Intermediary 101 organizations can pool these requests, and interested parties can up 102 the ante. Developers can then search through the current postings and 103 bid on development work or work on spec. Developers can also post 104 their own proposals, which users can then buy into.</li> 105 <li>Free software can be developed less expensively than closed 106 software products. Even for well paid professional developers, 107 fully underwritten by conscientious users, the cost of free 108 software would be significantly less than the premiums now being 109 paid for empire building. The quality would be better, especially 110 in terms of fitness for use. Free distribution would ensure 111 maximum exposure and choice: a free market based purely on 112 utility and quality. The service component of software would also 113 open up: anyone who wanted to could start from the same code, to 114 learn, support, and teach. The best service providers would 115 succeed.</li> 116 <li>Simple steps can get this movement underway: Form an initial 117 organization to sort out the technical issues, suggest working 118 arrangements, study the economics, hack out a legal framework, seed 119 and coordinate the requests, and canvas for initial technology 120 contributions (including the large body of currently available 121 freeware), do some evangelical work. Urge large companies and 122 organizations to budget a small fraction of their annual software 123 outlays for proposals. Set up a review group for intellectual property 124 issues, challenge dubious claims, and investigate the feasibility of 125 buying and releasing rights to valid claims. Encourage the 126 development of more local organizations—local to place, to 127 industry, to niche, to taste—with the initial group breaking 128 up or fading away: common methods and procedures, but no centralized 129 control.</li> 130 <li>Let's call this organization, this whole framework, “The 131 Free World.” It stands for free and open knowledge, free and 132 open development, software that works for you. Take a stand. Make a 133 contribution. You have nothing to lose 134 but <kbd>CTL-ALT-DEL</kbd>.</li> 135 </ol> 136 137 <hr class="column-limit" /> 138 139 <p>Additional notes can be found 140 at <a href="/philosophy/free-world-notes.html"> 141 gnu.org/philosophy/free-world-notes.html</a>.</p> 142 </div> 143 144 </div><!-- for id="content", starts in the include above --> 145 <!--#include virtual="/server/footer.html" --> 146 <div id="footer" role="contentinfo"> 147 <div class="unprintable"> 148 149 <p> 150 Please send questions and comments regarding this specific page to Tom 151 Hull <a href="mailto:ftwalk@contex.com"><ftwalk@contex.com></a>. 152 </p> 153 154 <p>Please send general FSF & GNU inquiries to 155 <a href="mailto:gnu@gnu.org"><gnu@gnu.org></a>. 156 There are also <a href="/contact/">other ways to contact</a> 157 the FSF. Broken links and other corrections or suggestions can be sent 158 to <a href="mailto:webmasters@gnu.org"><webmasters@gnu.org></a>.</p> 159 160 <p><!-- TRANSLATORS: Ignore the original text in this paragraph, 161 replace it with the translation of these two: 162 163 We work hard and do our best to provide accurate, good quality 164 translations. However, we are not exempt from imperfection. 165 Please send your comments and general suggestions in this regard 166 to <a href="mailto:web-translators@gnu.org"> 167 <web-translators@gnu.org></a>.</p> 168 169 <p>For information on coordinating and contributing translations of 170 our web pages, see <a 171 href="/server/standards/README.translations.html">Translations 172 README</a>. --> 173 Please see the <a 174 href="/server/standards/README.translations.html">Translations 175 README</a> for information on coordinating and contributing translations 176 of this article.</p> 177 </div> 178 179 <p>Copyright © 1997 Tom Hull</p> 180 181 <p>You may link to this document and/or redistribute it 182 electronically.</p> 183 184 <!--#include virtual="/server/bottom-notes.html" --> 185 186 <p class="unprintable">Updated: 187 <!-- timestamp start --> 188 $Date: 2021/10/01 10:44:32 $ 189 <!-- timestamp end --> 190 </p> 191 </div> 192 </div><!-- for class="inner", starts in the banner include --> 193 </body> 194 </html>