US Economy

David Smith DavidSmith at byu.net
Fri Apr 8 09:25:48 MDT 2005


<quote who="Merrill Oveson">

> 1) OSS has put significant pressure on commercial software producers
> this has caused them to a) lower their prices b) produce better
> software

How about some examples? The Windows OS costs more now than it did in 1995.

> Competition is always good - at least for consumers.  Monopolies are
> bad for consumers.  OPEC is a monopoly.  They are the #1 reason why
> oil prices are what they are.

Citing an example from the oil industry doesm't prove anything about the
software industry.

> 2) Because of reason #1, the cost to acquire software is less
> expensive.  This cost savings allows businesses and consumers to spend
> the saving on other goods and services.

How about providing some examples? Is there an example of a business who
was able to spend less on software thanks to F/OSS in such a manner that
they could afford other goods/services that they otherwise could not have?
Most IT budgets that I have seen go *up* year after year, not down, even
those that are using F/OSS.

With the lack of examples here, we can't accept this argument.

> Consumers (whether households
> or businesses always look to reduce costs.)  Producers (business or
> labor) always look for ways to increase the price of their goods and
> services.  Supply vs Demand - is what determines prices.  If OSS
> didn't exist, then commercial software would be much much more
> expensive.  Remember when WordPerfect was selling for $600?
> Microsoft, in an effort to gain marketshare around 1992, introduced a
> suite of applications Word, Excel, Powerpoint, Access all for $99.
> Suddenly, WordPerfect had to scramble to introduce their own suite,
> that's when they teamed up with Borland's Quattro Pro and Paradox -
> and had to suddenly cut the price of their flagship product
> WordPerfect.  Now a days we have better wordprocessors for way less
> money - especially factoring in inflation!

Now that's a concrete example, but not a good one for the argument at
hand. I doubt that Open Source had anything to do with the falling prices
cited here. After all, it wasn't until very recently that a competitive
open source office suite has been available. This is just an example of
competition lowering prices. It has nothing to do with F/OSS, nor does it
have to do with the argument at hand: whether F/OSS impacts the US
economy.

> 3) Lastly, because OSS was free and still is, this huge cost saving
> spurred a ton of new innovation and businesses.  Smart guys, like you
> all, grabbing Linux and Apache and setting up ISPs, or websites for
> commercial enterprises, or websites for your own commercial
> enterprise.  Heck I have a commercial website, it cost next to nothing
> to host, the software for it is free.  Without OSS, this would have
> never happened.  OSS and the internet (a result of OSS mentality) has
> reduced the cost of advertising, marketing, customer filfullment,
> mailing (Yes email makes the post office think twice before raising
> the cost of a stamp.), even shipping, banking, etc, etc, etc -
> everything.

This looks like a pretty good argument on the surface, but still lacks any
substantive examples. Prove that email makes the post office "think twice"
before raising the prices of stamps.

--Dave



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