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Why Making Money From Free Software Matters
Glyn Moody sends in what could be a watershed article, if the recording and movie industries are paying attention. "People have been making money from free software ever since Richard Stallman started selling GNU Emacs on tapes for $150 a pop. That's been good for hackers, who have often managed to make a living from their coding by working for one of the startups based around free software. And as companies like Red Hat and Google have grown in size and profitability, so have the credibility and clout of free software. But there is another reason why the success of these new kinds of businesses is so crucial: in many respects they offer a glimpse of coming shifts in other industries that need to grapple with the conundrum of how to make money from goods that are freely available. In particular, they offer the music and film industries an example of an alternative to fighting people's natural instinct to share digital abundance, by making money from new scarcities."
You can't really equate software and music/movies. Music and Movies are consumable products. You get it, you consume it. Maybe you watch it or listen to it more than once, but it's the rare consumer that uses the media as the means to an end.
Software is typically a means to an end. You don't install Linux just to have Linux. You install it because you want to do something with it. Same with web browsers, office suites, and just about any other software. The exception would be games which are meant to be consumed similarly to movies and music. But on the whole, most software is meant to help you create something else. Whether it be a resume, a presentation, a spreadsheet, even more software, the software exists as a tool, not a thing to be enjoyed in and of itself.
That's why it doesn't make sense to compare the music/movie industry to the general free software industry. The media industry is involved in making consumables, and that means they provide a finished product to the customer. The software industry provides tools which have ample room for customization and service work. The two industries start from different premises, so that's why software can be free whereas media cannot.
If you want to compare the industries, it makes sense to compare the media industry to the niche game software industry. But here you'll find very similar actions. Anti-piracy is the norm. Expensive packaged software (or downloadable paid software) and expensive CDs/DVDs are analogous. Even the antagonistic attitude between the customers and the producers is similar. It's just inherent in any industry that needs to protect its IP because that is precisely what it is selling.
Thus far engineers are the only ones to directly profit from open source businesses.
The single biggest mistake open source advocates make when envisioning a future is the assumption that successful engineering practices will be successful artist practices. You don't sample a Britney Spears song to make a longer, better Britney Spears song; you sample it for reference. Whereas when you patch emacs, you aren't referencing emacs, you are adding functionality.
Even if an artist subscribes to the free->fame startup model, eventually the steps to monetization involve controlling the distribution of copies. For example, first Danger Mouse released the Grey Album to great acclaim, then formed Gnarls Barkley and released music in traditional commercial channels.
While copyright is bad for engineers, it is a 300 year old legal framework designed to compensate artists. Discarding it for nothing is short sighted at best, and at worst exploitive of artists.
Oh, definitely. Two main things:
Assuming that you are the incumbent(whether The top dog, or just one of the people for whom the status quo is working quite well, thanks), every day you successfully delay change is another day of profit rather than loss, and risk rather than security. There may be a point where you cut your own throat by resisting change(either the cost of resistance simply becomes too high, and consumes all your profits, or your resistance actively precludes your taking advantage of certain options in the changed future); but until you reach that point, a rearguard action is totally rational, even if it is inevitably doomed on the medium to long timescale. The degree to which rearguard actions are logical is increased if you have access to overt or covert subsidies. In the media case, they've been very effective in lobbying for copyright infringement, and its tools, to be ever more criminalized and, once criminalized, made a greater law enforcement priority. Fighting change is always cost effective when you are using somebody else's money...
Second is that change is only really inevitable in hindsight. Many changes have been successfully fought, even though their proponents were convinced of their inevitability. Incumbents who don't fight change don't remain incumbents for as long as incumbents who do; because almost any change, unless it is truly structurally unsound, can push you over unless you push back; but only a relative few changes are irresistible(and, even in those cases, see point 1).
On the minus side, I would be rather more surprised to see a net positive value in change resistance("net positive" in the "overall value across a society" sense from econ). Incumbents, by virtue of being incumbents, so very often have access to other people's money with which to fight change. Therefore, it is logical to suspect that(because of that effective subsidy) a greater-than-socially-optimal amount of change-resistance is generated. Further, all but the most dramatic innovations have a period of manifest inferiority to existing, well-polished, methods. During this period, they can be smothered in the cradle at comparatively low cost.
The software is free, the developer's time is not.
You're free to use the software however you choose, but if you want the developer to spend his time working to your schedule, then you may have to make it worth his while.
Don't let THEM immanentize the Eschaton!