To Limit, or Not To Limit

(Edit: Hello, Slashdotters. Thanks for coming. Please don’t mind the mud, the Diggers yesterday were a rowdy bunch. 🙂 I kid, I kid.  The conversation I refer to in my first paragraph, which ranged over many topics in a monster-thread, began here.)

Recently I (foolishly) allowed myself to be drawn into a conversation about software piracy on Slashdot, where I said something to the effect of “My software has the least restrictive registration scheme I could devise, just enough to keep honest men honest”. This is not very popular at Slashdot, where the consensus is that you should put up a Paypal button and ask for donations and if you’re worthy you’ll make even more money.

This is, well, complete and utter rubbish. If you intend to make money by selling software, you need to limit your trial version. The only question is how. If you’ve got altruistic motives, if don’t like charging money, you can do whatever you want.

In the days of yore when shareware was a bright new idea on the scene and the ASP had an ironclad “no crippling” policy, Colin Messitt performed a brilliant experiment. He took a utility which had just written and had it secretly flip a coin on first installation: it would either function in unrestricted mode without being registered (and have two nag screens for donations) or it would be feature-limited (and have two nag screens offering the upgrade). When orders came in, Colin was able to track whether the order had been generated by the limited or unlimited version of his software. Keep in mind that this is a perfect experimental design: there is a control group which is guaranteed to be indistinguishable from the experimental group, and nobody but yourself knows whats going on.

Anyhow, to make a long story short, the limited version outsold the unlimited one. Five to one. Colin calculates that the experiment cost him $17,000 in sales versus having 100% of the installations be limited. Crickey.

Lets look at another example: Movable Type. Its a wonderful program and powers thousands of blogs across the Internet, including some of the biggest names out there. Movable Type was once donationware. Do you know how much the average donation was for? Note: average donation, not donation per user. Of all the people who thought Movable Type was worth paying real honest-to-God money for, the average donation was… 38 cents.

So if you’re going to limit your software, would you rather limit it based on features or based on elapsed time? I have a feeling this is highly specific to the actual software you have designed. For example, Bingo Card Creator gets used in many classroom once or twice a month. A full-features trial for 30-days is out of the question — “Oh, I only used that twice, why should I pay $25”? And I was worried that teachers would use Bingo Card Creator like they do many teaching supplies — fire it up, print up one master copy of all the included lessons (30 cards for each subject they need), and then just store those against need later in the year (and they can then just photocopy the cards and keep the master copy around for next time).

So here was my plan: I provide cards for free on my website and Bingo Card Creator will happily spit out cards for you, but there is no way to get enough cards to teach an entire classroom on anything. After you print out 15 copies for any particular word list you’re gently disallowed from printing more, told the reason, and if you attempt to circumvent the block you’ll find you keep getting the same 15 cards no matter what you do.

You can see, after Bingo Card Creator prints out 15 cards, that they will work for your classroom (or you can see that they won’t — I think its important that folks know exactly what they’re getting into). But you can’t teach class without 10 more cards, and those 10 cards cost you $24.95. And after you’ve made the leap saying “Well, I really want to play bingo on next Tuesday” you can justify it by saying “And hey, I can play bingo another 5 times this year and if I do this is really, really cheap”. (Making a set of bingo cards takes an hour, buying a set for class costs $10-15.)

The reason I can limit my software like this is because I know enough about my target market to know what feature I can disable which will keep the software attractive but render it very close to useless. For software which appeals to more people, this can be rather difficult. What feature would you knock out of Direct Access, for example? I’m at a loss — you could disable, say, autotext but many people don’t need autotext, and the folks who do need it would likely not use the rest of your program without it. So Direct Access is a timed trial — and, if you’ll pardon me tooting someone else’s horn, its absolutely brilliant at it. You see, if you’re the kind of person who really needs Direct Access, after you’ve used it for a week you can’t. Live. Without. It. If I didn’t have Direct Access installed on my computer it would hurt my productivity as much as losing my tab key. So when you run into that 30 day limit and the convinience you have been relying on for 3+ weeks just shuts down, you whip out the credit card. Plus there is an investment in using Direct Access, in that you’ve configured everything so its exactly to your liking, and if you had to investigate one of his competitors or Launchy (OSS with a similar feature set) you’d have to go through all the configuration again.

(P.S. Full disclosure: I bought Direct Access, at a discount to other Joel on Software readers he was offering, approximately 72 hours after installing it. The author doesn’t pay me to flog it and my opinions are totally my own. That being said, I love it love it love it.)

Edit: A few minor English improvements and more in-depth explanation of my “crippling” scheme. This got hit by a couple hundred people and I was embarassed about, e.g., spelling the man’s name “Colon” at one point.

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33 Comments on “To Limit, or Not To Limit”

  1. […] Are you coming up with your own software and confused over to make it shareware or donationware, but don’t have an answer. Well, MicroISV journal gives certain clues: In the days of yore when shareware was a bright new idea on the scene and the ASP had an ironclad “no crippling” policy, Colin Messitt performed a brilliant experiment. He took a utility which had just written and had it secretly flip a coin on first installation: it would either function in unrestricted mode without being registered (and have two nag screens for donations) or it would be feature-limited (and have two nag screens offering the upgrade). When orders came in, Colin was able to track whether the order had been generated by the limited or unlimited version of his software. Keep in mind that this is a perfect experimental design: there is a control group which is guaranteed to be indistinguishable from the experimental group, and nobody but yourself knows whats going on. […]

  2. Mike Says:

    Very interesting article. I have run into similar problems with some of my web development projects, having to come up with the best scheme for moving users from the “just browsing” category to something involving me getting paid. It’s nice to see some research on the subject. 🙂

    Regarding the reaction of others to your slashdot comments, I think there is a little bit of a freeloader thing going on. Particularly in that crowd, people are used to not having to pay for stuff and disagree with anything limiting their complete, free enjoyment of a product. Most software titles, however good, will not have enough of a userbase to be supported by donations alone.

  3. veridicus Says:

    Mike, it’s not just the freeloader syndrome on Slashdot. Many /. readers are developers. There’s almost a moral dilemma in crippling the software we write. Software is a labor of love, and while we’d like to profit from it, knowing we built something very useful is just as satisfying. That’s why for many people it feels “wrong” to cripple your own software. We’d much rather have people donate back what they feel is right even it turns out that brings in little money.

  4. Dave Says:

    As a regular software purchaser, I can tell you that I wont buy limit-ware that limits the features you can use, since that doesn’t allow us to properly evaluate if the software is going to fill the need. I will often however buy time-limit-ware, which gives me full eval ability, no features restricted, but stops working after 30 days of non-payment.

  5. mdielmann Says:

    Interesting article, and statement. I personally find crippled software REALLY irritating, to the point where I won’t even install most of them. OTOH, I can see your justification for the bingo card creator – there’s no other viable option without effectively making it donationware, and the financial repercussions that entails. I HAVE bought shareware before (TextPad – nag screen, label creator – nag screen, 2 or 3 games – nag screen), and will do so again if I come across things that are valuable to me. I’ve also considered making shareware myself, and faced all the dilemmas you did. It’s nice to have this information so I can make a more informed decision should I ever choose to make shareware.

  6. John Says:

    Many of the above posters miss the point. Crippling is BAD unless you KNOW YOUR AUDIENCE!!!

    Knowing your audience means that you can cripple it in a way that will motivate them.

    This is not a ‘one size fits all’ approach, you have to analyze each product and customer and make the appropriate choices. Sometimes its donation ware, sometimes its time limited and sometimes its crippleware in a specific capacity that allows the user to fully engage.

  7. Worker Says:

    The article with the study is like 12 years old. Interesting, but unfortunately, very dated.

    Web browser’s barely existed. Payment was what? Probably cheque and snail mail.

    The web was still newer than new, and there were no simple online-payment options. These may make a difference. I’d hope so. Hard to say.

  8. Rick C Says:

    Worker, the age of the study in and of itself isn’t relevant, I don’t think. What’s important is whether both groups of people got the software the same way, and it sounds like they probably did, since the program randomly determined whether or not to cripple. You should wind up with two more or less indistinguishable groups.

    It’d be interesting to see someone else repeate the study today, altho I wonder if the easy availability to information on the Internet would invalidate it–because people would be sure to wind up interacting with each other and would notice eventually they appear to get different versions.

  9. Timothy Wong Says:

    I personally do not purchase limit-ware. For example, software that renders images. If it doesn’t allow me to output a final file to say, a JPG, how will I be able to test the result and ‘power’ of this software? I can’t. If anything, I’d go for software that has a time-limited trial, before I purchase it.

    Timothy Wong

  10. becs Says:

    I am not a software developer, just a normal person. I think that the developer should have whatever type of software (free/ shareware/donations or whatever) that suit their needs.
    If someone wishes to offer a limited version it is not for anyone else to criticise this. If the customers wish to purchase the full version then they themselves deemed it worthy.
    However I do think that some companies restrictions on unpurchased software can be very mean. As Timothy says above, if someone cannot see the final product, how can they possibly decide whether it is worth buying or not? Having said that, I think the ability to print out 15 cards in your project is a good limit. People can see the final result and are in a better position to decide whether they want to purchase it or not.

  11. hillbilly Says:

    Interesting article. I am a web/desktop developer, and back in my freelancing days, I was screwed out of 4 grand because I didn’t have restrictions. Me and this ahole had agreed on a price, I delivered the product, and he didn’t pay, locked me out of the server, the whole nine yards. I learned my lesson, because from that point on when a client and I agreed on a price, the software was time bombed — If I didn’t deactivate the code on the timer (receipt of payment), then it would completly stop all funcinality of the program and pop up a nag screen when they tried to start it. 🙂

    That said, I have no problem offering some software for free…it keeps me on the bleeding edge of development. I have some free ware out, and I enjoy the fact that people are using it, and enjoying it themselves. However, I feel you should restrict software, even if it’s customware, if you intend to make money off of it. Free will donations never work because people do not care to donate!!! Give me ‘free’ or force me to pay, choose one.

  12. Frederik Says:

    I guess that all your limiting tricks mean that you don’t provide source code?

    Well, I only payed for software without source code, back in the time when I was uniformed.

    Now I only use Open Source software except in the case where no Open Source software exists for a certain task. Luckily this is rare: mostly situations that are created exactly by closed source software lock-in mechanism, such as a file format which is unreadble otherwise.

    Anyway, access to source code is considered as one of the primary rights of software users. Depending on software without access to the source code is a enormous risk, which I don’t want to take.

    This doens’t mean it has to be free (zero cost).
    E.g. you could have you free version which is free or not, and then the price could include access to the source code.

  13. […] Although the first question should matter to a user, it usually doesn’t. On the Atari ST I was an early adopter, avid user and evangelist of TurboAssembler. I often thought about sending money for it, even though it was expensive for a 14 year old, but I never got around to it because my copy just worked… There was nothing to fix. […]

  14. Like Frederik, today I would expect source code for an application to be available.

    More than that, even, not only must it have source code available but it must be Free in the sense of freedom, even if I pay money for it, which can happen, though of course licensing per copy or imposing crippleware restrictions isn’t possible.

    Indeed, restrictions and crippling ultimately lead you towards DRM, because otherwise any restriction can always be worked round or cracked, and what that means is that you expect to control what your user’s computers do. That’s what makes DRM morally and ethically wrong.

    Now I would never look at an application such as yours, except as a last resort and maybe not even then – crippleware is never going to turn up in the Debian repositories that are my starting point.

    Yes, I realise that means conventional proprietary software development is finished as a business model, and that includes crippleware and limited versions – and good riddance to it 🙂

  15. Patrick Says:

    I realise that means conventional proprietary software development is finished as a business model

    I don’t drink, but I have no illusions that “beer” is finished as a business model. 🙂

  16. Patrick:

    I don’t drink, but I have no illusions that “beer” is finished as a business model. 🙂

    “free as in Free speech”, not automatically gratis “free as in free beer”.

    Beer is a tangible and is consumed by use; software is an intangible which can be shared and redistributed without reducing or consuming the original. Your point again was?

    Commercial software development will surely continue, and Free software is entirely consistent with free enterprise and commerce.

    The business model where software licensing can be a “golden goose” or “bottomless pitcher” providing a continuous and indefinite revenue stream, however, is both failing and harmful to society, and can be/is being replacing by a different paradigm – but it is quite a shock to the mindset and the business of anyone who is used to being able to license software.

    Pricing in a Free software world is market-determined, and while not gratis is likely to be much lower than is possible by enforcing software licensing monopolies; in particular, it’s probably not possible to charge in and of itself for creating a copy, not beyond the physical cost of the media and duplication effort, at any rate.

  17. Paul Says:

    I would offer that today there is a popular belief that time and effort are worthless. Sort of a 1000 monkeys (volunteers) way of looking at the world. If you get enough Open Source developers, someone will come up with Adobe Premier / Microsoft Word / AutoCAD / ???. It is just a matter of time before it happens and then everyone can move to Open Source and give up on proprietary applications that cost money.

    Sure, you can charge your 1st customer for an Open Source project. You better make the price high enough because they can then resell it or give it away. As Mercury Merlin points out, there is no “golden goose” with Open Source. You have to get 100% of the value (development cost) out in a single sale. This is absolutely the opposite of most software development models today where you are amortizing the cost over 1000s of users each paying a small fraction of the “development cost.”

    The development cost isn’t just the cost of the CD here – it is the developer’s time. Most Open Source advocates assume this is worthless because it is a volunteer effort. Even in cases where someone tries to make a business based on some kind of Open Source they value the development effort at zero and charge for support or some other post-development activity.

    I don’t see this as a viable future. For the last 20 years or so business have been told over and over to move away from any sort of “customized” software and just use off-the-shelf solutions. Because any sort of “customized” solution will lock them into a vendor/contractor/developer. How does this work with Open Source because the source code is right there? If you haven’t tried to modify a large software product with just the source available you aren’t going to understand. The source is almost useless without understanding. Understanding can be derived from just the source but it takes a lot of time. Expensive time, if you are paying a contractor. How long do you think it would take someone to walk up and start making changes or bug fixes to Microsoft Word (easily over 500,000 lines of code) assuming the source was available?

    The key questions are: (a) can every write quality software? (b) is the time spent writing quality software worth anything? (c) if writing software is a “craft” how do we compensate the craftsman? All I see from the Open Source crowd is (a) yes (b) no and (c) volunteers will take over for the craftsman and replace him completely.

    I say B.S.

  18. […] Oddly enough right before I went on vacation I ended up on Slashdot for my recent musing on crippling trial versions. It being Slashdot, many people were shocked and amazed that someone would have the gumption to actually sell a program of the complexity of Bingo Card Creator. There was also, shall we say, a weeeee bit of animosity. Similarly, if you go to the Business of Software forums, every time the subject of OSS (open source software — to sidestep a debate which is essentially religious, OSS can be most easily understood as “software which you can use and modify for free”) comes up some folks have a weeeeee bit of animosity towards it. And when I say a weeeeee bit of animosity, its like saying that Israelis and Arabs don’t quite see eye-to-eye on that little land dispute they’ve had running for a few years. […]

  19. lamp Says:

    If you made your software open source then once you got sick of maintaining it the “freeloading users” who apparently like it so much but won’t pay for it could continue to maintain it themselves. Of COURSE people have to pay you if you make it impossible for anyone to improve on your work or help you with your work. Stop being so greedy. Frankly, programming isn’t that difficult and the idea that your *lowly users* couldn’t step in and help out with *BINGO CARD CREATOR* is B.S.. There are some software projects that are more difficult than others… like, uh, say, AN OPERATING SYSTEM! GNU/Linux is NOT shareware. Why are people who write trivial little apps charging but the people who make a crucial, complex and advanced OS NOT charging? people can diss on the opensource, “1000 monkeys” development model all they want to but I’m typing w/ a product of it right now and it’s way better than the “10 geniuses” OS.

    You can’t use the “if people didn’t pay me this wouldn’t happen” argument for shareware because all shareware is made way before anyone plops down some cash for it. Which means that you probably had your own use for it, regardless of whether you sell it or not. If you didn’t have your own use for it then it’s pretty foolish of you to produce a product that you have no idea will sell or not and no idea whether it will be useful to users since you, nor your friends and family, have never had a need for it.

    If you want to get paid to code then get a real job with a corp. They pay you because they can make money off of using your code to support business processes. That’s the way it should be. When companies produce only software they produce SHIT. Microsoft is a case in point.

  20. lamp Says:

    “Worker, the age of the study in and of itself isn’t relevant, I don’t think.”

    The age of the study has PLENTY to do with it. It’s incredibly easy to donate money now, and 12 years ago it wasn’t. Now I can just click a paypal button and donate whatever I feel like.

    Besides the age of the “study” it’s ONLY ONE EXPERIMENT. Hardly scientific. The guy goes into how well designed the experiment was. But well designed experiments have to be duplicated in order to be relevant.

  21. Ryan Smyth Says:

    One question to add is “what is the software’s output?” That matters. For my own software the output isn’t something that you can save or keep. Usage is ongoing so limiting features or output is counter-productive.

    That being said, a new mini-app I’m making creates output that users can take away from the program. So limiting functionality/output may be a better idea there.

  22. Jacob Says:

    It amazes me (though I guess by now it shouldn’t) that even after reading such a well-reasoned article, there is still a significant number of people who completely miss the point(s). Comments such as “If you didn’t have you own use for it then it’s pretty foolish of you to produce a product that you have no idea will sell or not” are so irrational that one can only hope they are being made by a young kid. Taking the risk to create something when you don’t know how well it will sell is the very definition of being an entrepreneur. If it weren’t for such risk takers, commerce as we know it today and all of the technologies and niceties that we enjoy simply would not exist.

    I’ve been running an open-source project for the last two years, and it’s certainly been an eye-opening experience. I don’t believe that open source software has even the slightest chance of taking over the world. The “millions” of developers working together to provide free software for everyone simply don’t exist, and they never will.

    I think it’s safe to say that you can tell whether or not a comment is coming from someone who has contributed to open source with a fair amount of certainty. The loudest and most obnoxious advocates of open-source bar, almost without exception, the freeloaders who contribute little, if anything back to the projects they use every day. Yet they seem to feel that they have some inalienable right to the source code for every piece of software ever written.

    I say put your coding abilities where your mouth is: go donate 2000 hours of your time to creating an open-source project, then come back in a couple years and we’ll see if you’re singing the theme tune.

  23. Open source coder or not, Jacob manages to miss the point entirely, so let us re-iterate it.

    “free” Free/libre software != free/gratis. Nor is it anti-commercial, nor about so-called “freeloaders”, though when you look at conventional software licensing charges you might question who is really “freeloading”.

    2,000 hours of coding time is about a year’s effort for one person, and at the time of writing a fair market value for that might be on the order of GBP 40,000, for a skilled and experienced programmer. Not rolling in riches, but easily a comfortable wage to live on.

    Per-copy licensing, however, is iniquitous in a network age. Today anything converted to digital form, whether software or a song, can be conveyed at effectively zero marginal cost to *everyone* who might make use of it. At worst any costs (bandwidth, media) can be borne by the recipients (think peer-to-peer downloads), and are in any case negligible.

    Charged per copy, if the rate is low enough to make it widely accessible, then even at that low price if it is even somewhat popular the potential return for that year’s work becomes astronomical; especially with copyright duration as at present, it is work that is being paid for and paid for again, effectively forever.

    If the charge per copy is higher, then suddenly the work becomes artificially restricted by that price; not because there is any physical, practical, or technical reason why it could not be distributed to everyone who might benefit from it, but due to the greed of the copyright holder.

    Most programmers are neither open-source volunteers, nor sole traders who retain copyright in their work. Instead they are paid employees or contractors, receiving a wage, This is why not much changes in a Free software world, as most software would still be commercially developed and custom-written code with supporting consultancy and services.

    What isn’t possible, however, is to put in one year’s effort, and expect limitless reward, not only that year but indefinitely, for life and for your children. For a widely distributed creative work, software or not, however, per-copy and even per-use licensing allows exactly that.

    The rest of humanity have to work this year and every year to pay the rent or mortgage, and worry about whether we can afford to save enough of a pension to live on in a few decades time, if we’re lucky enough to get that far. We don’t get paid this year and next year for work we did last year; that really is a “goose that lays golden eggs”, and digital restrictions and closed software make it possible.

    Now that’s what I call “freeloading”, and however delightful it may be to be in that position, it is wrong and harmful to our society if we let it happen.

  24. Patrick Says:

    Leaving aside the actual likelihood of software which is not actively in develoment continuing to sell in 3 years, to say nothing of generations, there is nothing wrong with continuing to profit from something which continues to provide value. Software makers are hardly the only people who do it — your local plumber can do it, too, if he saves up some of the money from snaking toilets and either a) starts a plumbing business hiring other people to snake toilets for him or b) buys a few shares in a mutual fund. Either of these will, with some element of risk, continue providing for his children’s children’s children if they don’t sell in the meanwhile. Its why that whole pension thing works out: so you can get paid in 40 years for the work you’re doing today. 🙂

    Meanwhile, while you continue to say that it is “wrong” and “harmful to society” that programmers be allowed to profit from their work more than some arbitrary level which you consider fair, you haven’t warranted why any given level of compensation is fair or not. If you look around, its not like there is an uber-class of programmers which have reduced the rest of humanity to their heel, which is what you would expect if your claims of “a totally unique opportunity for golden-gooseness” were grounded in reality.

  25. Franko Says:

    You don’t understand free software. The problem is the whole idea of trying to make money by programming. One programmer, even a not very good one, can in a short time fill for eternity the entire world’s need for a simple program.
    Say, a time synchronizer. A small team or one better or longer working programmer can fill the need for a simple single user calendar / personal organizer. If that program is open source, then it can get out and meet the needs of the world and be fixed if there ever develops a security problem. There is already enough open source software to do almost everything anybody would want, and if the commercial programmers wouldn’t waste their time trying to make money, the incentive to write the stuff that is missing would be much higher.

    Your real problem is that programming is too easy, and that it costs nothing to copy open source software. The proper way for programmers to be paid is by government grant or endowment from millionaires. Or just leave programming up to the people who want to do it for fun, there is a huge surplus even of them. But the need for even worrying about that issue of how to pay programmers is already past, as virtually all software anybody would need already exists and is open source.

    The real problem is making it easy for people to find the free software that fits their needs. This is hampered by search engine results often leading to spyware or commercial software, even when people search for terms like “free.” The answer to that is pretty simple. A simple law making spyware illegal, and making it illegal to buy or sell software. Then the search result hijackers could be shut down and people could more easily find the open source software they need. (Little joke. The actual trick is to search for terms like GPL, and to search on places like sourceforge.)

    Why do people buy any software? Because they are too dumb to know that if they searched for an extra 5 minutes they would find a free program that was as good. Just like the lottery, it is a tax on the stupid. We need the schools to teach this, in home economics class, along with the idea that credit card debt is bad. Then we can stomp out commercial software, the plague that it is. 🙂

  26. Patrick Says:

    That makes about as much sense as saying that free distribution of eBooks on the Internet will kill writing forever, because all one person has to do is write the Canonical Dragon Story (CDS) and there will be, forevermore, no need to pay fantasy authors for dragon stories. It completely ignores that different readers have different dragon-story needs, that one reader’s CDS is another’s terrible waste of paper, and that despite the fact there are millions of dragon stories already printed each additional one gives at least some value to someone.

    Incidentally: can I get a download link to the time synchronizer that completely and for all time solves time synchronization problems for all users?

    But the need for even worrying about that issue of how to pay programmers is already past, as virtually all software anybody would need already exists and is open source.

    And it all runs in 640 kb of ram, too!

  27. What’s happened is that a few things have changed, and in a relatively recent timescales. Those winds of change have been blowing for a few decades now, and plenty strong in the last few years.

    1) It is now the case that once reduced to digital form, pretty much anything can be distributed everywhere at effectively zero marginal cost. This did not used to be true, and it was very much less true the further back you go. All indications are it is becoming increasingly true as time passes.

    2) Copyright has been retrospectively extended so that it’s now effectively perpetual, and digital restrictions are being imposed to enforce it. If this were not the case, if there were not DRM and if copyright expired in a reasonable time (say 7 years, given the fast-moving reality of development today), then I would take some of the arguments favouring copyright and ownership thereof more seriously than I do at present.

    Point (1), however, means that to all intents and purposes an idea is no longer distinguishable from the expression of that idea in some fixed, recordable, copyable, and distributable form (with or without modification). That didn’t used to be the case, not in the same way.

    Here’s a free clue: you can’t own an idea. The moment you communicate it, you lose control of it. That’s what’s happening to software, and to other media as well.

    The question is not how you prevent that, which is the intention of the digital restriction mentioned (2) (can you stop the tide, King Canute?), the question is what business models are going to work in this new environment.

    Free/libre software is one model that seems to work; paid-for custom software as it already exists seems unaffected; grant-based basic research might be another, and there may be more. Proprietary, closed development, however, doesn’t seem to be coping in this environment.

    As for the canonical dragon story, I don’t know so much about dragons but you could say that epic fantasy as we know it took off from the roots laid by William Morris in the 19th century with the Wood Beyond the World and The Well at the World’s End; Tolkien and later exist in the shadow of and draw on Morris’s ground-breaking work.

    Interestingly, Canonical is the name chosen for Shuttleworth’s company which is spearheading a renaissance of open-source software for Everyman; it is not for no reason that this is so.

  28. Jacob Says:

    Regarding Franko’s post:

    Yeah, that’s the problem alright. It’s them darn programmers expecting to make a living doing something that’s so simple that most of the population can’t do it. You’ve been watching too many RoR demos.

    This is also the proper way for plumbers, artists, farmers, and mechanics to be paid. There is one little snag though. You may not be old enough to remember, but they tried this a while back and the result was people waiting in line for days for a loaf of bread and some milk. You’ve obviously thought of something they didn’t though, so please, do share your wisdom. Meanwhile, i’ll just have to live with the (obviously inferior) free market approach, where value-provider and value-receiver have to work out the details of how and how much is paid for a product without the government to act as a custodian. (There are so many problems with the model that you suggest that a whole book could be written on the subject, but I digress)

    90% or more of open source software is incredibly hideous, especially in the usability and documentation departments. There are good reasons for that, some of which Patrick covers here:

    Regarding Mercury’s post:

    You my friend are the one who missed the point. Any programmer unable to come up with “free/libre != free/gratis” on their own has been living in a cave for at least the last decade. Here is a couple more for you from my original post:

    Freeloaders != Open Source
    Freeloaders == those wanting to benefit from everyone else’s work without giving anything in return

    This is, in fact, what you want. You just won’t come out and say it. The real reason you, Franko, and many others want so badly for ALL software to be open sourced is so that you can use any program you please, without having to pay for it, and not feel guilty about pirating it.

    It’s a sense of entitlement expressed as a complete disregard for the countless hours of preparation, money, and work that go into creating, promoting, distributing, supporting, and maintaining a product. All of this effort is rationalized away to naught with a simplistic argument about how the cost of duplication (which is not zero, even for a bits and bytes) should be the only recoverable cost of doing business. And heaven forbid that anyone should be able to make a profit from selling the goods you consume. (This is like arguing that a car dealership should only be able to charge for the cost of materials on the cars they sell)

    Creating anything of value (physical or digital) and putting it to market requires an investment of time (for preparation and production), money, or more often, both. Just as with an investment in the stock market, an investment in creating a program involves risk – sometimes LOTS of risk. The only way to get people to take these risks is if there is sufficient incentive to do so. Usually the incentive in this case is the possibility of higher returns than say, working for McDonalds.

    Your assertion that 2000 hours invested in a product is worth some arbitrary value approximately equal to one year’s salary shows a complete lack of understanding not only of the effort involved in running your own business, but also of basic free market economics. If you’re punching a timecard every day and getting a regular paycheck, you are effectively accepting a lower return (your salary) in order to reduce your exposure to risk. If you’re a consultant, there’s a possibility that you’ll have many more gaps between paying jobs (risk), so consultants get paid more. If I decide to create a program to sell, the risk may be orders of magnitude higher. Let’s say I have to invest 2000 hours (1 yr, full time) plus operating expenses for that year (rent, food, etc), and I have no monthly paycheck coming in and no guarantee of any return at all. No sane person would make that kind of investment, with that much risk, without the potential for higher returns than those same 2000 hours invested in a full time job with an almost. This is not freeloading; it’s supply vs. demand and risk vs. return – the same principles that drive everything from produce prices to stock prices to interest rates on car loans.

    This also helps explain why open source software is usually of much poorer quality than equivalent commercial software. Creating high quality software, and everything that goes with it, can take a huge amount of effort, even for a fairly simple program. It’s the rare open source project where there is sufficient incentive for contributors to invest this level of effort. The few exceptions to this rule are almost always that way because they are used as a loss-leader for something else.

    Paul Grahm has a very good essay that, while not really addressing commercial vs. open source, certainly explains why the extremes you suggest would kill or at least severely dampen innovation in software or any other industry:

    The section titled “The Pie Fallacy” is very relevant to your misconceptions about commercial software and freeloading.

  29. A. The open source quality guy. Good measurements yah. It isn’t like you’re talking out of your ass there. I doubt you even know what you mean by when you say quality. Regardless, commercial and open source software are not that different and how they’re developed and who develops them are not different. Perhaps you are getting the software at a different time.

    B. You should be ashamed of yourself for making shareware. Denying all other users the freedom to use your software freely (as in freedom) is sinful and plain wrong. Regardless your software is simple and trivial, it isn’t worth the money and I feel sorry for anyone who paid for your product and didn’t get the source code.

    So continue to talk out of your ass, it isn’t like slashdot isn’t used to it.

  30. […] First, a brief discussion on why you want to protect your software. The only reason you want to protect your software is to enforce the limitations you have put on the trial version. Many people mistakenly come to the table with the assumption that protecting the software will somehow, magically, “protect my intellectual property” or something to that effect. This might be theoretically true but you will have an easier time conceptualizing your registration scheme if you think of it as primarily a marketing, rather than technical, measure. Its your salesman that encourages folks to pay you money. […]

  31. Heherson Tan Says:

    Hi Franco, Mercury Merliin and other OSS guys,

    I am just curious, how are you guys making a living? Are you paid programmers of OSS companies? If you are, I bet these companies have business model themselves. They just have different business models, like selling support instead of selling the software itself, or selling the hardware the OSS runs on.

    Truth is, software development is not possible with cash / financing. People and businesses that develop software must find a way to finance their development. If you are a volunteer programmer, you either must have a day job or ask people for grant or donations. Either way, your ‘business model’ goes like these “I’ll work on these OSS project at night / weekend, but I’ll work for AAA as an employee so I can pay the bills, etc”.

    Software Developers who sell their stuff most likely have something like these “I’ll develop these software, then users can use them for a fee.”

    Shareware Business has little difference from traditional brick and mortar businesses. You develop a product, you sell it. To compute how much you want to sell your product: PRICE = (OVERHEAD + PROFIT) / NUMBER_OF_ITEMS + MARGINAL_COST.

    The main difference I think is only the fact that the marginal cost of each product is so low or almost zero. The bulk of the cost is in the overhead (development cost). Implications? Like all businesses with low marginal cost and high overhead cost, you could be very successful or you can fail.

    BTW, even if a software still sells for 10 or 20 years or forever with zero development and marketing (how it could be??), you compute the Net Present Value of all the revenue. That means a revenue of $5000 a year for the next 20 years doesn’t earned

    Some of these companies are OSS companies, or at least companies admired by OSS community (I should know, I am a part of it):
    1.) REDHAT – Sells subscription based support for a distribution of their Linux. Even though REDHAT LINUX is OSS, it is awfully though to get one. In no small part to efforts of REDHAT. See, if you subscribe to their OS support, part of the support contract forbids you to distribute and install the OS on more machines. So much for FREE as in FREEDOM.
    2.) Google – Google support OSS by directly by the google code project (sponsoring approved projects and paying its developers) and other indirect means. This is nice. But has anyone of you got their source codes for their of engine? of their clustering architecture?
    3.) IBM – IBM helps the community by direct funding of OSS projects and OSDL, releasing its patents for OSS use, etc. Hey, IBM just sued Amazon for one of its patent, and receving $1billion a year for patent licensing. So much for ‘sharing your intellectual property so other people can use it’.

    Point is, these companies are not evil. Like all companies, they must earn money and must protect their competitive advantage. OSS and commercial softwares can coexist. A pragmatic person must choose which model will be more appropriate. There is no problem with that. The problem starts when one starts shoving his model / idealogy down somebody else throat.

  32. Geoff Dodd Says:

    To Limit, or Not? Nice article which proves behavioral psychology correct! People act according to the contingencies of reward. If x then y. If they can get FULL FEATURED software for nix then they’ll pay nought. Zilch donated or 0.38 cents as you say. So I think you’re quite right to limit by features until money is forthcoming. After all – you’re in the software Business! Not gifting.

    Additionally, I can say I’ve found open source software to be disappointing – unless you consider Mozilla Firefox to be open source. It’s free and fine ware.

    Geoff Dodd

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