Richard Stallman's new article: Overcoming Social Inertia

[Alex Hudson]

On Tue, 2007-11-06 at 20:04 +0100, David Picón Álvarez wrote:
> I think it is very clear that proprietary software pricing is
> abusive. The level of surplus value extracted from a zero-marginal-cost
> good, which in a free market would have near zero cost, is obscene. 

That's not really true. There are many examples of low marginal cost
items - software isn't particularly special in that regard. 

A free market doesn't put a near zero cost on such a product, because
that doesn't reflect the cost of the product: software for example has a
huge fixed cost. The marginal cost is only one aspect of the overall
costs, and you could only set the price close to that if you knew in
advance you would sell sufficient copies to cover your other costs.

The higher the fixed cost, the more risk a business takes trying to sell
that product - you can make a big loss if the product doesn't sell.

There are a few examples of companies who have made massive profits off
proprietary software, like Microsoft. Most proprietary software doesn't
generate anything like that level of profit; businesses selling such
products are as likely to be unprofitable as any other business.

Cheers,

Alex.