Open Source Fuels Software Demand

Written by: David Gordon

 

So you love the warm and fuzziness of Mac OS X, or you can not imagine a world without Microsoft Outlook by your side, or maybe you are an Adobe Creative Suite ninja.  You are supporting proprietary software, but you can still be an Open Source enthusiast.  In fact, most of the proprietary software products are influenced heavily by community driven software projects.  For example, Linux holds Windows and Mac to a standard simply by offering a free alternative OS.  Open Source gives software consumers a voice with which to say "We already know how to do that, what else can you do?". 

Software is a digital product, and from an economic perspective that means supply of existing software inventory is mostly unaffected by demand -- it costs nothing to copy ones and zeros.  Only demand for new software implies development cost.  So essentially, software producers have a money tree if they can develop a relatively low-maintenance product and cultivate a large user base.  This is how the former richest man in the world (Gates) made his billions.  Once a monopolistic market is formed in a specific software sector due to lack of competition, the business entity that controls that software has no incentive to innovate.

Proprietary software demand is driven by functional requirements, but not simply the conceptualization of functional nice-to-haves.  Alternative products must exist that at least threaten to attract users and distract them from their comfort products.  When users can consider Open Source alternatives, especially if the software is free (as in free beer), proprietary developers have the added pressure of justifying the cost of their product and therefore must exceed the minimum functional standards set by the contributing community.

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