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Calculating the True Worth of Software
chromatic writes "Many people recognize that the cost to duplicate a piece of software is a fraction of the number on its price tag. Many people also understand that software without support and maintenance loses much of its value. Is there a way to put a price on the software, support, maintenance, and the option for future upgrades itself? Robert Lefkowitz recently applied an options pricing model to software in ONLamp.com's Calculating the True Price of Software. Don't let the description fool you; it's both a readable and serious apologia of the common free software business model."
Is there a way to put a price on the software, support, maintenance, and the option for future upgrades itself?
Easy, these prices are proportional to the penetration indice of your previous software : a monopoly charge high fees, an outsider small ones.
I have discovered a truly marvelous proof of killer sig, which this margin is too narrow to contain.
...although simpler, I think. Apache 2 comes in at a half million dollars, Tomcat weighs in at $250K.
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another game: 25 cents
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getting the high score: priceless
(or so I thought at the time)
I've found that my posts don't format quite right w/o a sig.
How much should I charge for my software? http://www.joelonsoftware.com/articles/CamelsandRu bberDuckies.html
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You've just released your latest photo-organizing software. Through some mechanism which will be left as an exercise to the reader, you've managed to actually let people know about it. Maybe you have a popular blog or something. Maybe Walt Mossberg wrote a rave review in the Wall Street Journal.
One of the biggest questions you're going to be asking now is, "How much should I charge for my software?" When you ask the experts they don't seem to know. Pricing is a deep, dark mystery, they tell you. The biggest mistake software companies make is charging too little, so they don't get enough income, and they have to go out of business. An even bigger mistake, yes, even bigger than the biggest mistake, is
And this is an interesting point. I've always been amazed at the dollar figures the BSA gives out for the "value" of "pirated" software, avoiding the fact that a large percentage of these people would not have bought the legitimate copy anyway.
"Who are in control, they are not in control of anything - they don't even control themselves!" - Glen Beck
...unless there is monopoly or software doesn't have more-or-less equal alternatives (Photoshop, Autocad and so on).
Remember, that basic laws of free market (like the one in parent post) apply to market with equal (or almost equal) products.
If you are an architect and the only really viable piece of soft for you is Autocad, you can't speak of free market here.
You can't charge awefully more than your competition, can you ? If the competition gives it up for free -- then well, all your calculations go awry.
Think about the price of a browser, media player and well, a operating system.
Think Netscape vs IE circa 2000 AD. Now, only a free product could defeat IE.
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This sig is up for free.
Tell you what: in a normal world, if Adobe Premiere Pro isn't worth 800 to you, you don't buy it, and you certainly don't steal it. Period.
I'm disappointed at how many people here go along with the BSA/**AA line. Duplication is not theft. It may be illegal, and it may be wrong, but there is a clear difference.
How to solve most of our problems: 1.Lots of nuclear plants. 2.Cure aging.