Monday, April 21, 2008

Is it worth paying for software.

Having worked in a .Net shop for a few months now, I came into contact with a creature that I suspected but never actually observed in person: The Micro$oft fanboy.

Obviously this was cause for some conflict, since - of course - I'm a Java fanboy.

However the conflict was not based on the fact that .Net is better that Java or vica versa, rather the conflict was on open source vs Micro$oft.

Now Java is quite a mix of both proprietary and open source, in that even if you were running open source tools, the JRE was up until recently proprietary. Besides that, most environments have a mix of open source and proprietary tools with proprietary app servers usually running open source development frameworks. Finally most Java shops with half a brain will quickly realize that IDEA is worth the dosh u need to shell out for it.

This is not unusual in any industry actually.

Consider cars for a second; any car you buy should have a steering wheel. You don't pay extra money to equip your car with a steering wheel you expect it to have one since a car without one is pretty much a waste of time. It's also true that sometimes you want a little more out of your steering wheel so you spend some money and you buy a leather covered steering wheel or a integrated component steering wheel or a racing steering wheel or whatever.

"Ah But open source is free" you say, "the cost of the steering wheel is included into the price of the car".

Open source is not free, sooner or later someone is going to have to pay for the cost of development of open source software.

Consider Ubuntu which is basically financed from Mark Shuttleworth's fortune. If you buy products or services from a company which uses SSL certificates you have indirectly funded Ubuntu development.

The question is not if you should pay for software since sooner or later you do, but rather if it's worth paying extra for a piece of software.

I love Apple and OSX, an open source guy or not, I am willing to pay a little more for an Apple product, simply because I see value (justified or not) in using Mac OSX. I am however not prepared to spend money on an operating system that I view as purely utilitarian, should be part of the system I purchased and is there purely to run my applications since of course my system is a brick without it. In other words: M$ Windows.

Most modern personal computer systems are based on commodity hardware. You have a CPU using commodity instruction set, running on a commodity chipset, with commodity I/O devices. The only component that isn't commoditized is the Windows operating system you are pretty much forced to buy when you purchase it.

The only reason it isn't a commodity is because of the state of economic feudalism that pervades the desktop.

This is what Linux and indeed all Open Source software represents: a commodotized software environment where you pay for entire system as a solution as opposed to a paying a premium for what should have been included in the system to begin with.

Does this destroy the value in software; yes and no, on the one hand it destroys value in the software itself, but not in the additional value proposition that that software could provide. You don't make money from the core functionality but you can make money on the way that functionality is delivered.

Nobody buys a Mac because it can run programs, but because you are buying the Apple experience. People are also willing to pay for a RHEL license because they can leave all the headaches of using Linux with Red hat. On the other hand an eeePC is a purely functional device, why do I have to pay extra to simply operate the darn thing.

Open source represents the transition from software as a product to software as simply a part of the greater solution, where open source software is the commodity product. It's then left to us in the software industry as to how we can add value higher up the chain and for a change actually provide valuable solutions for our customers as opposed to just showering them with products.

Where does this leave M$?

Vista is proof of the reality of this model. In the realm of M$, XP is considered good enough, it is the defacto commodity product in this environment, for an enterprise there is simply is no reason to waste resources on Vista. Of course this is a dilemma for M$ since this does after all represent one third of it's revenue (another third from Office). M$ responded to the threat by simply stopping support for XP and if you are a business you must simply pay the Vista Tax. Economic feudalism in action.

The eeePC and Mac at least have shown that it's finally possible to allow you as a consumer to decide what you are prepared to pay in terms of software and one can only hope that M$ will eventually be forced to also one day provide solutions instead of commodity products.

No comments: