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You see this pattern for all professional tools, which have a very narrow expert audience. After a period of open competition, that for most fields ended in th

by yholio 6y ago

You see this pattern for all professional tools, which have a very narrow expert audience. After a period of open competition, that for most fields ended in the 80s and 90s, a closed source competitor emerges which becomes the industry standard. Massive moats, file formats, plugin investment, teaching of the tools in schools etc. prevent real competition, and the company becomes a fantastic cash cow. In the last decade most transitioned to the software as a service model, to better extract the rent they think they are "due" from the professional community. This is the type of setting where open source simply cannot subsist: the professional users are usually not programmers, the number of people using the features is limited (but for them, they are essential) and the expertise to develop them is very specialized. Furthermore, clients rarely need customized development done. Therefore, no developer community can form around an open-source competitor, comprised of either enthusiasts or professional providers of open source solutions. Photoshop vs. Gimp is a good example of all these pathologies. I think the solution to such problems would be marrying the open source philosophy with the commercial solution that allows developers to charge for licensing. We give up the „free to use” liberty for a limited time, allowing the "open" source developer to charge for the software like a commercial software vendor. Source is provided, and all contributors can operate on similar terms, charging for their patch for a limited time. After 3-5 years, the license reverts to a GPL compatible, that allows anyone the full four liberties, or, at their discretion, fork a commercial-open-source competitor for another 5 years period. This way, a flagship commercial product could be developed by a company that attracts the most users and has the best features, and that company has a number of years to recoup it's investment by making it's userbase pay for those features in licensing fees. Once it's exclusivity period ends, in order to maintain it's commercial dominance the company must innovate and improve the product, otherwise people would use an older version for free, or a competitor can emerge that can disrupt its rent seeking by forking the old version as a new „commercial open source” project with it's own 5 year exclusivity period.

TheOtherHobbes 6y ago
You mean something a bit like - what's the word? - a patent? That won't solve the problem, because this is not a software problem. It's an economic problem. To maximise profit you need to dominate a market by 1) locking out competitors 2) forcing customers to give you money 3) spending as little as possible on continued development. This happens because that's how capitalism works. It's an inevitable consequence. Effectively it becomes a form of rent-seeking, where corporations charge their "tenants" money for access to a resource. And as long as the product sort of works some of the time corporations can claim customers are getting something of value. But really these corporations are like bad landlords, charging users a huge monthly rent and never fixing the leaky roof. The answer would be more along the lines of a user's association - effectively a "union" for users which was prepared to fight aggressive and expensive class actions to challenge ridiculous licensing terms and make corporations accountable for consequential damage and lost time caused by bugs. This may sound extreme, but when there's no competition - because competing products have been bought and shut down or left to rot - it's a de facto antitrust situation. Governments are unlikely to enforce this, so class actions to challenge unreasonable contract terms and assert that in fact there are obligations towards users may be the only way to fix this.
- yholio 6y ago
  Lock-in is not inherent to capitalism, see for example how open platforms like Linux competed successfully with closed platforms like Windows, with all their resources. So there is something particular with, say, operating systems, webservers or browsers that allow open source alternatives to thrive, while the same is not for tools aimed at professions outside the software/programmer/IT realm. Governmental solutions are unlikely to help. What I mean by my proposal above is not to reinvent patents, but to make copyright work for the benefit of society. A limited form of copyright, adapted to the digital age, with a much shorter duration and source code available.
- fennecfoxen 6y ago
  Excuse me. This is not intrinsically how capitalism works. Capitalism can exist in free and non-free markets. Capitalism in a free market is efficient if property rights which exist and are enforced, there are low barriers to entry, and there are low transaction costs. You have just described capitalism with barriers to entry. At this point you have left free-market capitalism, and entered a world with no particular term of art describing it. I would say it is best called by an epithet like "crony capitalism." The operation of free markets is Intro to Econ material. You should pursue a remedial course that you may understand this before proposing remedies, because while some of your proposed remedies hit near the mark, I think this is by accident. The most effective remedy is competition, achieved once you can dismantle the barriers to entry. You mention antitrust in passing, which is the key policy-based approach, and regulatory provisions against trusts are mentioned in passing in the article — but mostly you focus on a "union" of customers, and I have grave doubts to its efficacy in practice. There is a massive coordination problem here, thousands of firms and their legal departments who must agree to risk substantial consequences individually in order (denying themselves key software) to achieve the collective goal.
  - jessaustin 6y ago
    Before prescribing remedial education, perhaps you could consider the root word of "capitalism" a bit more carefully? "Capital" has its own interests, but those don't include free markets, which latter I hope we can agree is more important for the innovation upon which humanity relies. Properly understood, all "capitalism" is eventually revealed as what you're calling "crony capitalism". Temporarily the owners of capital and their sockpuppets might have to pretend to value free markets. Unless the local political or ethical system is quite incorruptible, capitalists' true colors are eventually seen. After all, they have the money, by definition. Many people will do unethical things (e.g. write tax codes under which corporations pay no taxes) in exchange for money.

by yholio 6y ago

TheOtherHobbes 6y ago

You mean something a bit like - what's the word? - a patent? That won't solve the problem, because this is not a software problem. It's an economic problem. To maximise profit you need to dominate a market by 1) locking out competitors 2) forcing customers to give you money 3) spending as little as possible on continued development. This happens because that's how capitalism works. It's an inevitable consequence. Effectively it becomes a form of rent-seeking, where corporations charge their "tenants" money for access to a resource. And as long as the product sort of works some of the time corporations can claim customers are getting something of value. But really these corporations are like bad landlords, charging users a huge monthly rent and never fixing the leaky roof. The answer would be more along the lines of a user's association - effectively a "union" for users which was prepared to fight aggressive and expensive class actions to challenge ridiculous licensing terms and make corporations accountable for consequential damage and lost time caused by bugs. This may sound extreme, but when there's no competition - because competing products have been bought and shut down or left to rot - it's a de facto antitrust situation. Governments are unlikely to enforce this, so class actions to challenge unreasonable contract terms and assert that in fact there are obligations towards users may be the only way to fix this.

yholio 6y ago
Lock-in is not inherent to capitalism, see for example how open platforms like Linux competed successfully with closed platforms like Windows, with all their resources. So there is something particular with, say, operating systems, webservers or browsers that allow open source alternatives to thrive, while the same is not for tools aimed at professions outside the software/programmer/IT realm. Governmental solutions are unlikely to help. What I mean by my proposal above is not to reinvent patents, but to make copyright work for the benefit of society. A limited form of copyright, adapted to the digital age, with a much shorter duration and source code available.
fennecfoxen 6y ago
Excuse me. This is not intrinsically how capitalism works. Capitalism can exist in free and non-free markets. Capitalism in a free market is efficient if property rights which exist and are enforced, there are low barriers to entry, and there are low transaction costs. You have just described capitalism with barriers to entry. At this point you have left free-market capitalism, and entered a world with no particular term of art describing it. I would say it is best called by an epithet like "crony capitalism." The operation of free markets is Intro to Econ material. You should pursue a remedial course that you may understand this before proposing remedies, because while some of your proposed remedies hit near the mark, I think this is by accident. The most effective remedy is competition, achieved once you can dismantle the barriers to entry. You mention antitrust in passing, which is the key policy-based approach, and regulatory provisions against trusts are mentioned in passing in the article — but mostly you focus on a "union" of customers, and I have grave doubts to its efficacy in practice. There is a massive coordination problem here, thousands of firms and their legal departments who must agree to risk substantial consequences individually in order (denying themselves key software) to achieve the collective goal.
- jessaustin 6y ago
  Before prescribing remedial education, perhaps you could consider the root word of "capitalism" a bit more carefully? "Capital" has its own interests, but those don't include free markets, which latter I hope we can agree is more important for the innovation upon which humanity relies. Properly understood, all "capitalism" is eventually revealed as what you're calling "crony capitalism". Temporarily the owners of capital and their sockpuppets might have to pretend to value free markets. Unless the local political or ethical system is quite incorruptible, capitalists' true colors are eventually seen. After all, they have the money, by definition. Many people will do unethical things (e.g. write tax codes under which corporations pay no taxes) in exchange for money.