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A Cynic Rips Open Source
AlexGr writes to tell us that Howard Anderson chaired an interesting meeting the other day with senior executives from Cisco, Agilent Technologies and Novell. The discussion took a look at whether or not enterprise users really want open source. "Naturally, I disagreed -- partially because I am a naturally disagreeable person. Any idiot can make friends -- but can you make some really serious enemies? I disagreed, however, because allegiance to open source depends on who you are. Let me give you an example. If you are No. 1 or No. 2 in your industry, you hate open source. You make your money by selling proprietary solutions: Microsoft and Cisco. If you are No. 3 to No. 10, you look at open source as a way to get back to those serious RSEUs, because they are where you make money."
The guy is clearly trolling-for-dollars. And some fools at Slashdot are giving it to him. Ignore the article.
I first read this article on an Australian site (http://www.computerworld.com.au/index.php/id;8103 29453/) last week and it has been syndicated and is doing the rounds. This guy, Howard whoever he is, clearly has done zero research and has no facts to back up his comments - especially the finale.
At the end of last year the EU Commission released one of the most comprehensive reports on the impact, spread and use of Open Source, around the world. They found that, in actual fact, only around 10% of those who contribute to Open Source projects (the software engineers) are employed by proprietary vendors - the overwhelming majority are employed by the enterprises Howard so cynically believes are using FLOSS purely to beat down the cost of proprietary systems.
You can download the entire report from the EU itself here: http://flossimpact.eu/
There are many other reports from major research organisations that are concluding similar things. Forrester research has recently found that over 50% of large enterprises are using FLOSS in mission critical applications and this is growing.
A quick Google would lead Howard to many of these findings.
Alanhttp://www.theopensourcerer.com/
Oooh, no wonder! Maybe they're not a PR group for Microsoft, but I sure remember how one of their analysts (was it DiDio? I forget) trumpeted SCO and it's case against IBM.
No wonder this guy is such a dumbass troll. Nothing to see here, folks, just some wanker trying to get a rise out of us all.
"He is also founder of The Yankee Group.."
Surely you all remember miss Didio and her corperate horse whispering.
The marginal cost is how much it takes to create any additional product. After you've written the first copy of the software, there are no man-hours required to write the second copy.
The GP stated that the _marginal_ cost is 0, not that the entire cost or even the amortized cost is zero. The marginal cost is the additional cost of producing one extra unit. Your development costs are the same whether you sell 1 license or 1000 licenses; therefore the additional cost of those extra 999 licenses is zero. Thus the GP is exactly right, and software itself breaks the current economic model.
If anything should be Open Source, if not Free Software, it is the programs in automotive ECUs.
Not gonna happen. That would be a Clean Air Act violation.
In neoclassical economics, where value is measured relative to supply, you may be correct. However, there are other definitions of value (which is part of why this thread branch has gone around in circles)
However, if you go back to classical economics and then to Marx, you will find the concepts of use-value and exchange value. Software would generally have a non-zero use-value (because using it creates economic efficiency and therefore produces benefits to the user) and an exchange value (the cost in money) that should approach zero (to your point about marginal cost of production).
However, we find that isn't true (go look at the cost of Microsoft Office). This is true due to the cost of performing a transition to a new software program (file compatibiltiy, training, etc.). Due to these costs, Microsoft (and others) can value price their product. As long as the (classical economic) value provided by their product is greater than that of an open source/free solution, companies will continue to purchase Office.
On the other hand, I agree that we need a new model. Classical economics handles software just fine; it's just that neoclassical economics (heavily dependent upon scarcity) doesn't handle software well. It's not that classical economics doesn't have its own problems... so I agree there is a place for a new model.
No it doesn't. Artificially limiting the distribution of software via copyright, might, but software itself does not. Software development as a service (as open source business models use it) is classic capitalism. It is only capitalism as it applies to services (programming) as opposed to a commodity.
Thus it has no value.Having a clean floor has no inherent value, but still capitalism accommodates the selling of cleaning services, just fine.
I look at this arguement the same way I look back at the recent discussion on Hybrids and how great they are.
Any time a bunch of know it alls get in a room there will never be an agreement.
Add the fact that a majority of the people on the soapbox are activists who simply want socialism (i.e. everything is free and theft is only wrong if you are stealing from someone less fortunate than you)
And what you come up with is a bunch of half-wits claiming intellectual superiority and factual representation, whcih always ends with name calling and insults (again- see my posts in the most recent hybrid vehicle discussion).
Smirk and walk away I say- enlightenment is an individual occasion and is subject to the depth of one's understanding of reality.
In the meantime- flame on liberals!!!!!!!
I would disagree that the "marginal cost of production of a unit of software is damn near 0," when you take into account the man-hours required to create the software in the first place.
You're partially correct. The cost to develop a piece of software is called the sunk cost. It's a good term, just what it sounds like. You sink money into development and it sinks out of sight. It's gone. The cost to duplicate and distribute the product after that is, essentially, 0.
Not like a car. You have sunk cost in auto design as well, but the bulk of the cost is in the components. Cars have intrinsic value as any chop-shop can demonstrate. Software does not have intrinsic value. It can be duplicated for nothing.
Many economists disagree, but my opinion getting away from an economy based on making things with value and relying on things with no intrinsic value is a really bad idea. An economic Pearl Harbor. Maybe we won't be around long enough for something really bad to happen, but if it ever does it could well be an unimaginable disaster.
That's our life, the big wheel of shit. - The Fat Man, Blue Tango Salvage