4 ms·

That's not what rent seeking means in this context. https://en.wikipedia.org/wiki/Rent-seeking https://en.wikipedia.org/wiki/Rent-seeking

frgtpsswrdlame 9y ago
Eh, it still applies. There's plenty of articles that have been posted here talking about how the real way to make money is SaaS, not on-prem. In that context, the provider is making more profit with no further innovation, in fact the only thing they've added is a limitation. To quote from your link: Rent-seeking is an attempt to obtain economic rent (i.e., the portion of income paid to a factor of production in excess of what is needed to keep it employed in its current use) by manipulating the social or political environment in which economic activities occur, rather than by creating new wealth. Rent-seeking implies extraction of uncompensated value from others without making any contribution to productivity. The classic example of rent-seeking, according to Robert Shiller, is that of a feudal lord who installs a chain across a river that flows through his land and then hires a collector to charge passing boats a fee (or rent of the section of the river for a few minutes) to lower the chain. There is nothing productive about the chain or the collector. The lord has made no improvements to the river and is helping nobody in any way, directly or indirectly, except himself. All he is doing is finding a way to make money from something that used to be free.[5] Now maybe, the program used to be $40 and not free but switching to $20 a month is definitely rent-seeking.
- yannyu 9y ago
  To universally label the move from on-prem, perpetual licensing to SaaS as pure rent-seeking is to misunderstand how different kinds of software products are purchased and used by different users. As far as enterprise/business customers go, SaaS has been huge in reducing vendor lock-in and enabling customers to choose the best fit for their use case. SaaS has removed the huge costs of PoCs and initial adoption, meaning it's easier to evaluate vendors and switch when you're ready. You no longer have to buy the hardware to get the service up and running, or allocate as many employees to maintain the hardware and software. The explosion of vendors and competition in the SaaS space has forced more interoperability and customer-focused feature development than ever before. SaaS has been great for pretty much all business customers. At this point, I don't think any but the largest companies, most specialized companies would rather build their own services at this point than try to purchase off the shelf when possible.
  - frgtpsswrdlame 9y ago
    Damn I got a buzzword bingo on your second paragraph, holy crap man. Do you think a toll-road operator couldn't also describe all the benefits of a toll-road? Does that make it not rent-seeking? Look, we're on a (at least mildly) technical forum, we can be honest here - SaaS has been great for providers and sometimes great for customers. And I'm not talking about off-the-shelf vs built-in-house, I'm talking about billing method.
    - yannyu 9y ago
      You can attack the presentation of the content, but do you think anyone wants to go back to the days of dealing with Oracle and SAP charging you for perpetual license and support, and then also needing consulting by the hour from them or a Deloitte/Accenture? Things really sucked in enterprise software in the 90s, and SaaS has made a lot of things so much better. And I'm not talking about off-the-shelf vs built-in-house, I'm talking about billing method. In many cases, the billing method has influenced the way the products work and how they're developed.

frgtpsswrdlame 9y ago

Eh, it still applies. There's plenty of articles that have been posted here talking about how the real way to make money is SaaS, not on-prem. In that context, the provider is making more profit with no further innovation, in fact the only thing they've added is a limitation. To quote from your link: Rent-seeking is an attempt to obtain economic rent (i.e., the portion of income paid to a factor of production in excess of what is needed to keep it employed in its current use) by manipulating the social or political environment in which economic activities occur, rather than by creating new wealth. Rent-seeking implies extraction of uncompensated value from others without making any contribution to productivity. The classic example of rent-seeking, according to Robert Shiller, is that of a feudal lord who installs a chain across a river that flows through his land and then hires a collector to charge passing boats a fee (or rent of the section of the river for a few minutes) to lower the chain. There is nothing productive about the chain or the collector. The lord has made no improvements to the river and is helping nobody in any way, directly or indirectly, except himself. All he is doing is finding a way to make money from something that used to be free.[5] Now maybe, the program used to be $40 and not free but switching to $20 a month is definitely rent-seeking.

yannyu 9y ago
To universally label the move from on-prem, perpetual licensing to SaaS as pure rent-seeking is to misunderstand how different kinds of software products are purchased and used by different users. As far as enterprise/business customers go, SaaS has been huge in reducing vendor lock-in and enabling customers to choose the best fit for their use case. SaaS has removed the huge costs of PoCs and initial adoption, meaning it's easier to evaluate vendors and switch when you're ready. You no longer have to buy the hardware to get the service up and running, or allocate as many employees to maintain the hardware and software. The explosion of vendors and competition in the SaaS space has forced more interoperability and customer-focused feature development than ever before. SaaS has been great for pretty much all business customers. At this point, I don't think any but the largest companies, most specialized companies would rather build their own services at this point than try to purchase off the shelf when possible.
- frgtpsswrdlame 9y ago
  Damn I got a buzzword bingo on your second paragraph, holy crap man. Do you think a toll-road operator couldn't also describe all the benefits of a toll-road? Does that make it not rent-seeking? Look, we're on a (at least mildly) technical forum, we can be honest here - SaaS has been great for providers and sometimes great for customers. And I'm not talking about off-the-shelf vs built-in-house, I'm talking about billing method.
  - yannyu 9y ago
    You can attack the presentation of the content, but do you think anyone wants to go back to the days of dealing with Oracle and SAP charging you for perpetual license and support, and then also needing consulting by the hour from them or a Deloitte/Accenture? Things really sucked in enterprise software in the 90s, and SaaS has made a lot of things so much better. And I'm not talking about off-the-shelf vs built-in-house, I'm talking about billing method. In many cases, the billing method has influenced the way the products work and how they're developed.