[clug-talk] Suggestions?

Dwayne C. Litzenberger dlitz9734 at dlitz.net
Tue Mar 22 22:02:14 PST 2005

On Tue, Mar 22, 2005 at 12:29:38AM -0700, Martin Glazer wrote:
>I'm due to give a talk next month to a group new entrepreneurs and small 
>business owners. I would like to introduce them to Linux and explain how 
>they can benefit from the use of open source software.

Let's say that you rely on Program X to carry out your day-to-day business.  
Now assume that something about your business changes, and Program X no 
longer does exactly what you need it to do.  You need to change the way 
Program X functions.  If your supplier for Program X anticipated your 
needs, then the cost of making the change is relatively small, since you 
only need to change Program X's configuration.  But what if Program X 
doesn't already have the ability to do what you want?  You need a custom 
change.  How much will that cost?

If Program X is proprietary software, the cost of changing it depends on 
the program's vendor.  If the vendor cooperates with you to get you the 
changes you need in a reasonable amount of time at a reasonable cost, then 
your costs are relatively little.  However, if the vendor does not 
cooperate -- such as if they demand that you first "upgrade" to Program Y 
(which requires new hardware, a new proprietary operating system, etc) or 
if you are simply too small for them to care about your specific needs -- 
then the cost of changing Program X skyrockets: You have to hire one or 
more expensive genius-programmers to reverse-engineer Program X and 
implement your changes, or you have to hire someone to re-implement large 
portions of Program X from scratch, or maybe you just can't afford it and 
you go out of business.

With free software, free-market economics govern the cost of changing 
Program X to your specifications: You can hire anyone you want to change 
Program X, and there is no point where an uncooperative vendor causes
your costs to skyrocket.  You also get to maximize the value of your 
existing information infrastructure, since you have the ability to weigh 
the cost of maintaining your existing software/hardware against the cost of 
converting to new software/hardware.  Also, since all of your programs and 
data formats are open, the cost of converting to new software/hardware is 
similarly governed by free-market economics.

Probably the main advantage of free software is the freedom, and the 
cost-normalizing effect that this freedom has.  Free software is governed 
by free-market economics.  Proprietary software, where every vendor has a  
monopoly on its software, is governed by monopoly economics.

What kind of economics do you think are better for you, the consumer?

Dwayne C. Litzenberger <dlitz at dlitz.net>

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