Showing posts with label markets. Show all posts
Showing posts with label markets. Show all posts

04 March 2010

The Bottom-Up View of Free Software

The charmingly-named "Bottom-Up" is one of those blogs that I may not always agree with, but which I know will be intelligently written and well-worth reading. And sometimes I find myself not only in perfect synchrony with its author, Timothy Lee, but wishing I'd put something so well as he has.

Here's a case in point, a post discussing the view that "the government has an obligation to make its decision based on the characteristics of the software, without discriminating based on licensing or business models." This is the "level-playing field" argument that I discussed recently, and pointed out that there were historical reasons to do with vendor lock-in why such "playing fields" actually favoured incumbents.

But Lee comes up with a brilliant analogy:

Suppose federal agencies had a long-standing practice of obtaining their care fleets by renting them from companies like Enterprise and Hertz (or, more likely, government contractors that charged ten times as much as Enterprise and Hertz would). Now suppose the GSA did a study and found that the government would save hundreds of millions of dollars by purchasing automobiles rather than renting them. Suppose further that many agencies were finding that the limitations of their rental contracts (mileage limits, reporting requirements, slow repair service, whatever) were making it harder for them to do their jobs. So the GSA issues new guidelines saying that government agencies should henceforth prefer buying to renting.

Now, there are all sorts of good arguments on both sides of the renting-vs-owning decision. But one argument that doesn’t make sense is to say that government would be “distorting the market” if it decided to buy cars rather than leasing them. A purchased car is a different kind of product than a leased car. If car ownership serves the government’s needs better than car rental, the government is entitled to purchase cars without worrying about how this affects companies in the business of renting cars.

The same point applies to software. The difference between Windows Server 2008 and Red Hat Enterprise Linux isn’t just that one was produced by humorless suits in Redmond and the other was produced by dirty hippies in Raleigh. It’s not even that one costs a lot of money and the other one is free. (Support costs will often dwarf licensing fees anyway).

The key difference is that proprietary software comes with a lot of restrictions about how it may be used—restrictions that don’t apply to free software.

...

The freeness of free software is not an esoteric detail about how software was produced, nor is it primarily a matter of ideology. Rather, free software provides direct and tangible benefits to their users. If property rights is a bundle of sticks, free software vendors give you all the sticks up front, whereas proprietary vendors give you only some of the sticks so they can charge you later for the others. And some of the missing sticks are things that actually matter to government agencies. So it strikes me as a no-brainer that the government would—all else being equal—prefer the type of software that comes with fewer strings attached.

It’s absurd to say that the government has an obligation to be indifferent between firms that attach strings to their products and firms that don’t do so. Obviously, there are circumstances where a firm makes such a great product that it’s worth putting up with the associated strings. But it should be equally obvious that software freedom is a factor to weigh in software purchase decisions. And I don’t anything wrong with reminding government IT workers to keep this factor in mind when they make software purchasing decisions..

The key point here is that different kinds of licensing bring with them very different kinds of benefits, and deciding to favour one over the other is a valid decision. What wouldn't be fair would be favouring a particular type of supplier over another where the benefits they offered were broadly the same: that would simply be a distortion of the software market. But here we effectively have two quite different solutions - different markets - like those of car purchase and car rental. It's a great way of looking at things, and one that I wish I had thought of....

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07 January 2008

Paying the Price for Google

An interesting analogy here between Google and markets - with a nasty ecological payoff that we will all pay for people gaming the system (just as spam games the email system, and threatens to destroy it):

As every web content producer adjusts to Google, its results become necessarily less and less compelling. The joy of Google past was to think hard about the search query and get a first screen result full of relevant but quirky, even obscure material. A Google result today is much less sensitive to the driver, because every content maker is trying to "buy" space that it can't pay for in genuine links. SEO [Search Engine Optimisation] will ossify Google and a better solution will wipe it out with the speed of an epidemic. The web has become over-fitted to Google like a strain of wheat becomes over-designed to a specific ecology. The web is covered in content strategies over-designed to Google, and new mechanism will find a source of meaningful, un-manipulated information---just as the hyper-link was before PageRank made it a gameable commodity.