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>Linux works, but who's to say it's 'optimal'? Given the huge amount of value it creates, I think relatively little filters back into the development of the sys

>Linux works, but who's to say it's 'optimal'? Given the huge amount of value it creates, I think relatively little filters back into the development of the system. And that's the crux of the problem. You seem to think that it's optimal if it puts money in to developers pocket. I'm saying it's optimal it provides more value for less cost to the consumer. Market is about consumers not about producers. >If no one pays for it, the consumer will not get the value because the developer will have to do something else to make money, and will therefore not produce the code. Where did I say nobody pays for it ? If you want to develop software and charge for it you're still left with different options, you can deploy with contracts/NDA style to the Oracle type market, you can sell software as a service and keep the source private (you can do this even with games by streaming them), or you can do ad-based apps like Zynga and mobile guys, you have major copying in that space and very little copyright enforcement - it sucks for the developers but it works for the consumers. And there's doing on demand stuff, where the customers pay in advanced, and can subsequently opensource it to distribute costs of maintenance or even split the costs by forming alliances (I've seen this in energy sector where three big companies decided to standardize and share some data exchange software), regular consulting/maintenance approach, etc. And there are probably many other ways to make money without IP. Demand still exists, you just need to find a way to profit from that demand without IP. All I'm trying to say is that intellectual property is a legal monopoly on non-rivalrous non-excludable good, it violates the nature of innovation (incremental improvement and copying are essential) and copying as creating new value for free instead of stealing.

davidw 15y ago
> You seem to think that it's optimal if it puts money in to developers pocket. No, I'm saying that if no money flows to developers, it's suboptimal because consumers lose out too. It has to be a balance, and IP has been a pretty good, if imperfect, way of achieving that balance. That's not to say I don't think IP needs an overhaul. I do, however, think that IP is part of the solution and not just 'bad'.
- moonchrome 15y ago
  >No, I'm saying that if no money flows to developers, it's suboptimal because consumers lose out too. But that's my point, Linux/Android, and by extension most of opensource, work mostly outside of IP protections and are able to match closed source and compete. I see no reason why Google wouldn't be able to use it's business model without IP. So even now it works, without IP the entire industry would be forced to restructure. Again - the demand doesn't disappear - you just need to find new ways of satisfying it while making a profit. Just because it's not obvious and would cost a lot of companies their business doesn't mean it's a bad thing. Apple is sitting on billions of dollars in cash on hand and protecting "multitouch". Apple's profit is largely due to it's IP monopoly, if knockoffs and iterative improvements were allowed under different brands Apple's competitive edge after the first mover advantage wears off (and seeing how long it takes phones to hit the market with Android for eg. it's a significant window of opportunity) would be efficient production, more innovation and marketing, all of which create extra value to the consumer. So they would be forced to invest in product more aggressively, margins would shrink without innovation - you would have a more competitive market. Production would have to be restructured to even further protect trade secrets (which would screw cheap China manufacturers because they can't be trusted with IP sensitive jobs if they can sell knockoffs). Conversely they would need less to protect from legal threats.
  - davidw 15y ago
    Open source is wonderful, provides a great deal of value, and it definitely works well. For some things. It seems to work quite well when the 'currency' of exchange is patches/bug reports/feedback and that sort of thing. It seems to be a tougher proposition for more 'end user' types of things. OpenOffice, if you recall, was created as a proprietary project, and only later open sourced, just as one example. What your examples point to is a world where IP producers are forced to cozy up to someone who actually controls a scarce resource in order to benefit, rather than do so on their own. (I do agree, BTW, that software patents suck and are not good, and destroy value). (Also, BTW, "it's" means "it is").

davidw 15y ago

> You seem to think that it's optimal if it puts money in to developers pocket. No, I'm saying that if no money flows to developers, it's suboptimal because consumers lose out too. It has to be a balance, and IP has been a pretty good, if imperfect, way of achieving that balance. That's not to say I don't think IP needs an overhaul. I do, however, think that IP is part of the solution and not just 'bad'.

moonchrome 15y ago
>No, I'm saying that if no money flows to developers, it's suboptimal because consumers lose out too. But that's my point, Linux/Android, and by extension most of opensource, work mostly outside of IP protections and are able to match closed source and compete. I see no reason why Google wouldn't be able to use it's business model without IP. So even now it works, without IP the entire industry would be forced to restructure. Again - the demand doesn't disappear - you just need to find new ways of satisfying it while making a profit. Just because it's not obvious and would cost a lot of companies their business doesn't mean it's a bad thing. Apple is sitting on billions of dollars in cash on hand and protecting "multitouch". Apple's profit is largely due to it's IP monopoly, if knockoffs and iterative improvements were allowed under different brands Apple's competitive edge after the first mover advantage wears off (and seeing how long it takes phones to hit the market with Android for eg. it's a significant window of opportunity) would be efficient production, more innovation and marketing, all of which create extra value to the consumer. So they would be forced to invest in product more aggressively, margins would shrink without innovation - you would have a more competitive market. Production would have to be restructured to even further protect trade secrets (which would screw cheap China manufacturers because they can't be trusted with IP sensitive jobs if they can sell knockoffs). Conversely they would need less to protect from legal threats.
- davidw 15y ago
  Open source is wonderful, provides a great deal of value, and it definitely works well. For some things. It seems to work quite well when the 'currency' of exchange is patches/bug reports/feedback and that sort of thing. It seems to be a tougher proposition for more 'end user' types of things. OpenOffice, if you recall, was created as a proprietary project, and only later open sourced, just as one example. What your examples point to is a world where IP producers are forced to cozy up to someone who actually controls a scarce resource in order to benefit, rather than do so on their own. (I do agree, BTW, that software patents suck and are not good, and destroy value). (Also, BTW, "it's" means "it is").