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>> Software is weird because it is expected that should be free (as in beer) for most consumers while while being for profit and giving high salaries to its wor

>> Software is weird because it is expected that should be free (as in beer) for most consumers while while being for profit and giving high salaries to its workers. I struggle to think of any other privately owned sector of the economy that works that way. Software is the only industry where the marginal cost of the product is ZERO. All software you use has already been developed, you are presumably paying for updates and future versions - otherwise it's just rent. Something like Reddit is not pure software though, they have infra costs. This is why Free Software is worthwhile to use and contribute to - it only needs to be written once for everyone to benefit from. Notice I didn't say "Open Source" because a lot of people want to commercialize that. YMMV.

akoboldfrying 2y ago
> Software is the only industry where the marginal cost of the product is ZERO. The same is true of anything where all the value is in the bytes -- news, film, music, the written word.
- rchaud 2y ago
  Not so for movies, the marketing budget and press junket tours end up costing as much as the film production itself. Music is also pay-for-play, but buying off radio stations and promotional spots on Spotify is not nearly as expensive as movies.
  - akoboldfrying 2y ago
    Marketing doesn't affect the marginal cost of a movie -- the cost of allowing one more person to watch it.
- phkahler 2y ago
  >> The same is true of anything where all the value is in the bytes -- news, film, music, the written word. Good point. I consider those "media or content" to be "played", "read", "watched" whereas software is more a thing to be used - or a set of capabilities added to a physical thing. Video games OTOH are software meant to be played so that occupies both of my mental categories. Stop it! You're making me think! ;-)
- littlestymaar 2y ago
  In fact most industry have marginal cost which is zero or otherwise negligible, as was remarked by French economist Maurice Allais in his discussion about the train to the city of Calais. Think about a restaurant: the food has been bought and will rot if not sold, the cook and the waiter are being paid and so is the rent, so the only truly marginal cost in such a scenario is the cost of the energy needed for the stove or the oven (and only for dishes that get cooked at the last minute and not upfront), which is negligible compared to all of the upfront costs.
  - akoboldfrying 2y ago
    > Think about a restaurant: the food has been bought and will rot if not sold This is a good point to raise, though I think we can refine the meaning of "marginal" to preserve a meaningful distinction between, say, restaurant meals and software: Although the ingredients for making the meals have already been purchased, so there is no direct causative link between an additional customer arriving and additional ingredient cost, there remains a statistical link: Ingredient purchases are done based on a statistical model of what number of customers, with what preferences, are likely to arrive in the near future. I would very roughly characterise this as: There is some duration x such that if n more customers than expected show up during the next x days, n additional portions of ingredients will be purchased sometime later (in anticipation that this increased demand is now "the new normal"). The above could do with improving, but what's important is that software (and media) do not have any such statistical link: If 100 people buy your program this month, 200 the next month, 300 the next month, there is no additional cost outlay for you to make in order to meet the requirements of selling an (estimated) 400 copies the following month.
    - littlestymaar 2y ago
      That's entirely true. I just like to point out that the marginal cost is an impractical concept in most cases. The only thing that matters IRL is the average cost, and as you point out, it is always monotonically decreasing for software and other IP-based businesses, which isn't the case doe for other kinds of industries.
seec 2y ago
This is why the large commercial operation keeps updating their stuff with plenty of useless nonsense or unnecessary look lifting (looking at you Apple). The problem is that we mostly don't have a correct mechanism to price software in a way that would be fair to both the developer and users. For example, even if you calculate exactly what it costs to build a particular piece of software (all the devs salaries, plus all the office costs plus all the infrastructure costs) and you arrive at a particular number. How do you divide that number for customer? The more there are the cheaper, but also if it became "free" after everything has been paid (because the marginal cost of copy is effectively zero) it looks like a better strategy to let others front the money. It's like plenty of things in life, if people were honest things would be very easy but since they aren't we need to have suboptimal systems in place...

akoboldfrying 2y ago

> Software is the only industry where the marginal cost of the product is ZERO. The same is true of anything where all the value is in the bytes -- news, film, music, the written word.

rchaud 2y ago
Not so for movies, the marketing budget and press junket tours end up costing as much as the film production itself. Music is also pay-for-play, but buying off radio stations and promotional spots on Spotify is not nearly as expensive as movies.
- akoboldfrying 2y ago
  Marketing doesn't affect the marginal cost of a movie -- the cost of allowing one more person to watch it.
phkahler 2y ago
>> The same is true of anything where all the value is in the bytes -- news, film, music, the written word. Good point. I consider those "media or content" to be "played", "read", "watched" whereas software is more a thing to be used - or a set of capabilities added to a physical thing. Video games OTOH are software meant to be played so that occupies both of my mental categories. Stop it! You're making me think! ;-)
littlestymaar 2y ago
In fact most industry have marginal cost which is zero or otherwise negligible, as was remarked by French economist Maurice Allais in his discussion about the train to the city of Calais. Think about a restaurant: the food has been bought and will rot if not sold, the cook and the waiter are being paid and so is the rent, so the only truly marginal cost in such a scenario is the cost of the energy needed for the stove or the oven (and only for dishes that get cooked at the last minute and not upfront), which is negligible compared to all of the upfront costs.
- akoboldfrying 2y ago
  > Think about a restaurant: the food has been bought and will rot if not sold This is a good point to raise, though I think we can refine the meaning of "marginal" to preserve a meaningful distinction between, say, restaurant meals and software: Although the ingredients for making the meals have already been purchased, so there is no direct causative link between an additional customer arriving and additional ingredient cost, there remains a statistical link: Ingredient purchases are done based on a statistical model of what number of customers, with what preferences, are likely to arrive in the near future. I would very roughly characterise this as: There is some duration x such that if n more customers than expected show up during the next x days, n additional portions of ingredients will be purchased sometime later (in anticipation that this increased demand is now "the new normal"). The above could do with improving, but what's important is that software (and media) do not have any such statistical link: If 100 people buy your program this month, 200 the next month, 300 the next month, there is no additional cost outlay for you to make in order to meet the requirements of selling an (estimated) 400 copies the following month.
  - littlestymaar 2y ago
    That's entirely true. I just like to point out that the marginal cost is an impractical concept in most cases. The only thing that matters IRL is the average cost, and as you point out, it is always monotonically decreasing for software and other IP-based businesses, which isn't the case doe for other kinds of industries.

seec 2y ago

This is why the large commercial operation keeps updating their stuff with plenty of useless nonsense or unnecessary look lifting (looking at you Apple). The problem is that we mostly don't have a correct mechanism to price software in a way that would be fair to both the developer and users. For example, even if you calculate exactly what it costs to build a particular piece of software (all the devs salaries, plus all the office costs plus all the infrastructure costs) and you arrive at a particular number. How do you divide that number for customer? The more there are the cheaper, but also if it became "free" after everything has been paid (because the marginal cost of copy is effectively zero) it looks like a better strategy to let others front the money. It's like plenty of things in life, if people were honest things would be very easy but since they aren't we need to have suboptimal systems in place...