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It is Adam Smith’s “rent seeking” in a modern hyper-scalable form. It should be shunned and criminalized on a basis of anti-social economics. Now the other extr

It is Adam Smith’s “rent seeking” in a modern hyper-scalable form. It should be shunned and criminalized on a basis of anti-social economics. Now the other extreme of free software is, arguably, also (economically) bad, as it fails to reward the effort of the creators proportionally to the value gained by the user. Let us buy our software, and separately, offer us a service agreement that actually has to provide value in its own right. The bundling of these in SaaS is what makes this obscene.

mypornaccount 1y ago
I sell my saas to willing buyers at the fair market price.
- tshaddox 1y ago
  That’s not mutually exclusive with rent seeking, of course.
  - missedthecue 1y ago
    But rent seeking implies some sort of external party enforcing a non-competitive environment that benefits you. Like tariffs or aggressive zoning laws. Raising the price of your product isn't rent seeking.
    - 9rx 1y ago
      You're right, but software does find itself in a non-competitive environment thanks to a sea of intellectual property laws that benefit incumbents. That external party is ever-present, and no doubt implied in discussions here.
      - theamk 1y ago
        Unless you mean copyright / trade-secrets specifically, then IP laws don't really help SaaS that much. For example take Google Workspace - email, calendar, docs. Google has no particular patents for those, and I've never heard about startups in this area not getting traction because of IP troubles. Same goes with Jira, or Github, or Slack, or AWS S3 - all of those don't have particularly many patents and in fact there are plenty of alternatives, self-hosted or otherwise. People still pay for them happily.
  - csomar 1y ago
    Nah, rent seeking happens when the customer is faced with little choice (ie: constrained market, can only live there, can't build more, etc...). This is not the case for most of SaaS where you can just signup to another service.
pistoriusp 1y ago
This is exactly how I'm thinking of monetizing the framework.
jamestimmins 1y ago
I don't quite follow this logic. Nearly all SaaS has ongoing costs from the provider: hosting, support, r&d, etc. How is that rent seeking?
- lokimedes 1y ago
  Most of that software could run on prem. The problem is that bundling hosting with the actual software in many cases translates into a way to confuse the expense of one for the other. Things that don’t incur operating expenses shouldn’t be charged as a monthly fee, that is rent seeking. Forcing someone to pay for “services” like hosting, “upgrades”, etc. to gain access to the software is what I find problematic. Now that the business model has become dominant, it is hard to find any software not on a SaaS-like payment plan. Adobe, Autodesk, Microsoft, etc. all sold software and now all sell subscriptions with little added value to the customer. But the cashflow of a rent model, as forewarned in “Wealth of nations” is so ensnaring it can only be avoided by law. Yet here we are.
  - tonyhart7 1y ago
    Yeah but who going to fund R&D and stuff like that???
  - nkmnz 1y ago
    > Most of that software could run on prem. No, because that would require everyone to own and operate their own servers. I am very happy I do not have to share my bedroom with a server rack so that I can operate my company - not to speak of the cost to deploy a 15gbit/s line to my apartment…
  - brookst 1y ago
    But this is still such a bastardization of the term “rent seeking” that is is somewhere between disingenuous and flat out lying. By this logic, my house cleaner is rent-seeking because I pay every week, but I could do the work myself. That’s not what rent-seeking is. That is a garden variety service. All of the anti-subscription sentiment just sounds like “I want perpetual support and updates for a one-time price”, which is just silly. It’s actually bad for the customer because once the service provider has your one-time payment, they have zero incentive to keep you as a customer. It leads to misaligned incentives as sellers seek to expand to new markets to reach new customers while neglecting existing customers who are nothing but expense. Further, SaaS produces net lower costs because resources can be utilized more efficiently. Great, you can do an on-premise server, but you need to spec it to support the busiest second in the busiest day of your year. Most of the time it will be underutilized. Sorry, this whole claim is such a massive misunderstanding of Smith and SaaS that it’s making be a bit crazy.
paxys 1y ago
If you are so passionate about it then start a company that builds, deploys and maintains SaaS software on-prem for a comparable cost (say $10/user-mo). If you can provide the same service, guarantees and price points as the typical SaaS while letting companies keep control of their data and preventing lock-in then you'll have the largest market in the world.
- lokimedes 1y ago
  It was just called software. People ran it on their own servers. It worked just fine.
  - pistoriusp 1y ago
    We should chat. We're busy building a store for source code.
  - sanswork 1y ago
    and instead of a monthly license you paid an annual support contract plus salaries of staff to maintain your servers and on site support for staff.
    - ozim 1y ago
      And when you had to update version and pay new version license you got push back from bean counters, because current runs fine - and bean counters didn’t like to hear now we have to pay 10x or 100x because no one wanted to spend money on incremental updates because it worked.
    - Retric 1y ago
      SaaS is rarely cheap by comparison. Start with a few services at ~10$/user/month and it doesn’t take a very large org before the numbers get quite high. And you generally still need some technical support in house.
      - sanswork 1y ago
tshaddox 1y ago
> Now the other extreme of free software is, arguably, also (economically) bad, as it fails to reward the effort of the creators proportionally to the value gained by the user. What’s the economic explanation then for why so much high quality (or at least, widespread and critical) free software exists?
- hiAndrewQuinn 1y ago
  Probably that free software never actually dies or even really degrades in the traditional sense. Given decades of time, even small incentives to make things better, like the reputational increase one gets from contributing to good FOSS projects, compound really heavily. Take the Linux kernel as an example. If you were a kernel hacker, even a minor one, from the 1990s, it's quite likely you could parlay that experience into a good job today doing something similar. Those 50-100 hours decades ago have compounded quite nicely for you. But your contribution didn't decay over the next 30 years - worst case scenario, it stayed exactly as good as it was when you stopped, and best case scenario it's been substantially rewritten and incremented upon. That's how I explain it to myself at least.
- AlienRobot 1y ago
  That's only true for libraries because developers benefit from bugs getting fixed. FLOSS applications are far from high quality.
dilyevsky 1y ago
so basically s/subscription/service agreement/ ?
missedthecue 1y ago
Exercising available pricing power isnt the same thing as rent seeking.
chermi 1y ago
Kind of, but not really. I would instead say that the idea of "stickiness" or trying to make your software sticky is rent-seeking. Of course, most SaaS companies vigorously pursue stickiness, but it is not an intrinsic property of SaaS.
Imustaskforhelp 1y ago
For what its worth, I always feel as if we could provide a binary and then let the binary run on things like aws/gcloud/ preferably cloudflare workers as cf workers feels genuinely good if you focus on typescript/imo sveltekit as well Please, can anybody enlighten me I suppose? I build a lot of side projects, some of which are genuinely cool and I can genuinely see it being a "saas" but like you, I hate saas from a consumer perspective and I love saas as a guy wanting to earn money so my ethics are definitely questionable at the moment. Also, let's say I want somebody to buy my software. How does that make sense? What if they just redistribute that software without my permission. Doesn't that just eat into the profits when Saas couldn't. And also I personally am a foss advocate and as you said its economically bad. I am kind of thinking of creating software which is just source available and that you need a permission / license which you can get by github sponsoring me but I saw this one project doing it and the people in hackernews were pitch forking the poor guy. Its so crazy and bizarre that once you actually try to provide "some" value. You are automatically the bad guy for not using MIT. I am also thinking of such a license where its SSPL if you don't have a license or BSD/MIT if you have a license (sort of like redis-ish) But I am not sure if people would buy them. Maybe I can support both I suppose? I am not sure lol, which is why I wanted to get enlightened PS: I built a way to create your own cryptocurrencies for genuinely free (no jokes)(not sure how to monetize and if, If anybody can help, that would be great!) and a way to get blogs from youtube posts and a way to youtube community post and videos as an alternative to google photos for unlimited storage (though the privacy aspect for community post is a little bad but I guess I can fix that as well)
- deleted 1y ago
  [deleted]
opan 1y ago
Strong start, but not a fan of the attack on free software. I think I agree with your last paragraph, but what would such a service entail then? Like a tech support contract?
popalchemist 1y ago
This is a straw man argument, as evidenced by all the other comments replying. I am curious, have you had any moment of insight following your initial comment? OR is this the hill you die on?

mypornaccount 1y ago

I sell my saas to willing buyers at the fair market price.

tshaddox 1y ago
That’s not mutually exclusive with rent seeking, of course.
- missedthecue 1y ago
  But rent seeking implies some sort of external party enforcing a non-competitive environment that benefits you. Like tariffs or aggressive zoning laws. Raising the price of your product isn't rent seeking.
  - 9rx 1y ago
    You're right, but software does find itself in a non-competitive environment thanks to a sea of intellectual property laws that benefit incumbents. That external party is ever-present, and no doubt implied in discussions here.
    - theamk 1y ago
      Unless you mean copyright / trade-secrets specifically, then IP laws don't really help SaaS that much. For example take Google Workspace - email, calendar, docs. Google has no particular patents for those, and I've never heard about startups in this area not getting traction because of IP troubles. Same goes with Jira, or Github, or Slack, or AWS S3 - all of those don't have particularly many patents and in fact there are plenty of alternatives, self-hosted or otherwise. People still pay for them happily.
- csomar 1y ago
  Nah, rent seeking happens when the customer is faced with little choice (ie: constrained market, can only live there, can't build more, etc...). This is not the case for most of SaaS where you can just signup to another service.

pistoriusp 1y ago

This is exactly how I'm thinking of monetizing the framework.

jamestimmins 1y ago

I don't quite follow this logic. Nearly all SaaS has ongoing costs from the provider: hosting, support, r&d, etc. How is that rent seeking?

lokimedes 1y ago
Most of that software could run on prem. The problem is that bundling hosting with the actual software in many cases translates into a way to confuse the expense of one for the other. Things that don’t incur operating expenses shouldn’t be charged as a monthly fee, that is rent seeking. Forcing someone to pay for “services” like hosting, “upgrades”, etc. to gain access to the software is what I find problematic. Now that the business model has become dominant, it is hard to find any software not on a SaaS-like payment plan. Adobe, Autodesk, Microsoft, etc. all sold software and now all sell subscriptions with little added value to the customer. But the cashflow of a rent model, as forewarned in “Wealth of nations” is so ensnaring it can only be avoided by law. Yet here we are.
- tonyhart7 1y ago
  Yeah but who going to fund R&D and stuff like that???
- nkmnz 1y ago
  > Most of that software could run on prem. No, because that would require everyone to own and operate their own servers. I am very happy I do not have to share my bedroom with a server rack so that I can operate my company - not to speak of the cost to deploy a 15gbit/s line to my apartment…
- brookst 1y ago
  But this is still such a bastardization of the term “rent seeking” that is is somewhere between disingenuous and flat out lying. By this logic, my house cleaner is rent-seeking because I pay every week, but I could do the work myself. That’s not what rent-seeking is. That is a garden variety service. All of the anti-subscription sentiment just sounds like “I want perpetual support and updates for a one-time price”, which is just silly. It’s actually bad for the customer because once the service provider has your one-time payment, they have zero incentive to keep you as a customer. It leads to misaligned incentives as sellers seek to expand to new markets to reach new customers while neglecting existing customers who are nothing but expense. Further, SaaS produces net lower costs because resources can be utilized more efficiently. Great, you can do an on-premise server, but you need to spec it to support the busiest second in the busiest day of your year. Most of the time it will be underutilized. Sorry, this whole claim is such a massive misunderstanding of Smith and SaaS that it’s making be a bit crazy.

paxys 1y ago

If you are so passionate about it then start a company that builds, deploys and maintains SaaS software on-prem for a comparable cost (say $10/user-mo). If you can provide the same service, guarantees and price points as the typical SaaS while letting companies keep control of their data and preventing lock-in then you'll have the largest market in the world.

lokimedes 1y ago
It was just called software. People ran it on their own servers. It worked just fine.
- pistoriusp 1y ago
  We should chat. We're busy building a store for source code.
- sanswork 1y ago
  and instead of a monthly license you paid an annual support contract plus salaries of staff to maintain your servers and on site support for staff.
  - ozim 1y ago
    And when you had to update version and pay new version license you got push back from bean counters, because current runs fine - and bean counters didn’t like to hear now we have to pay 10x or 100x because no one wanted to spend money on incremental updates because it worked.
  - Retric 1y ago
    SaaS is rarely cheap by comparison. Start with a few services at ~10$/user/month and it doesn’t take a very large org before the numbers get quite high. And you generally still need some technical support in house.
    - sanswork 1y ago

tshaddox 1y ago

> Now the other extreme of free software is, arguably, also (economically) bad, as it fails to reward the effort of the creators proportionally to the value gained by the user. What’s the economic explanation then for why so much high quality (or at least, widespread and critical) free software exists?

hiAndrewQuinn 1y ago
Probably that free software never actually dies or even really degrades in the traditional sense. Given decades of time, even small incentives to make things better, like the reputational increase one gets from contributing to good FOSS projects, compound really heavily. Take the Linux kernel as an example. If you were a kernel hacker, even a minor one, from the 1990s, it's quite likely you could parlay that experience into a good job today doing something similar. Those 50-100 hours decades ago have compounded quite nicely for you. But your contribution didn't decay over the next 30 years - worst case scenario, it stayed exactly as good as it was when you stopped, and best case scenario it's been substantially rewritten and incremented upon. That's how I explain it to myself at least.
AlienRobot 1y ago
That's only true for libraries because developers benefit from bugs getting fixed. FLOSS applications are far from high quality.

dilyevsky 1y ago

so basically s/subscription/service agreement/ ?

missedthecue 1y ago

Exercising available pricing power isnt the same thing as rent seeking.

chermi 1y ago

Kind of, but not really. I would instead say that the idea of "stickiness" or trying to make your software sticky is rent-seeking. Of course, most SaaS companies vigorously pursue stickiness, but it is not an intrinsic property of SaaS.

Imustaskforhelp 1y ago

For what its worth, I always feel as if we could provide a binary and then let the binary run on things like aws/gcloud/ preferably cloudflare workers as cf workers feels genuinely good if you focus on typescript/imo sveltekit as well Please, can anybody enlighten me I suppose? I build a lot of side projects, some of which are genuinely cool and I can genuinely see it being a "saas" but like you, I hate saas from a consumer perspective and I love saas as a guy wanting to earn money so my ethics are definitely questionable at the moment. Also, let's say I want somebody to buy my software. How does that make sense? What if they just redistribute that software without my permission. Doesn't that just eat into the profits when Saas couldn't. And also I personally am a foss advocate and as you said its economically bad. I am kind of thinking of creating software which is just source available and that you need a permission / license which you can get by github sponsoring me but I saw this one project doing it and the people in hackernews were pitch forking the poor guy. Its so crazy and bizarre that once you actually try to provide "some" value. You are automatically the bad guy for not using MIT. I am also thinking of such a license where its SSPL if you don't have a license or BSD/MIT if you have a license (sort of like redis-ish) But I am not sure if people would buy them. Maybe I can support both I suppose? I am not sure lol, which is why I wanted to get enlightened PS: I built a way to create your own cryptocurrencies for genuinely free (no jokes)(not sure how to monetize and if, If anybody can help, that would be great!) and a way to get blogs from youtube posts and a way to youtube community post and videos as an alternative to google photos for unlimited storage (though the privacy aspect for community post is a little bad but I guess I can fix that as well)

deleted 1y ago
[deleted]

opan 1y ago

Strong start, but not a fan of the attack on free software. I think I agree with your last paragraph, but what would such a service entail then? Like a tech support contract?

popalchemist 1y ago

This is a straw man argument, as evidenced by all the other comments replying. I am curious, have you had any moment of insight following your initial comment? OR is this the hill you die on?