Re: Value of software (was: Re: [ox-en] New pages in the introduction)
- From: Graham Seaman <graham seul.org>
- Date: Mon, 3 Jun 2002 13:23:38 -0400 (EDT)
Hi Stefan(s)
On Mon, 3 Jun 2002, Stefan Merten wrote:
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Hi Graham and all!
On Mon, 13 May 2002, Stefan Meretz wrote:
Am Freitag, 10. Mai 2002 00:08 schrieb Graham Seaman:
Commercial software is not a commodity, and has no value. It has no
value in the sense that it has no price (you cannot buy software, and
eg. Microsoft's EULAs always say 'you have not bought this software').
I'm not so sure, whether this is the whole truth. Isn't there software
which *is* actually sold to customers? It won't be software with a
wide use of course, because then scarcity would be a problem. However,
in niche markets you may actually sell (all the rights on) a software
you have written to your customer. BTW usually a customer in a niche
market won't be interested that competitors also get "their" software
which they can enforce by buying all the rights at the software.
Yes, some software is sold to customers. It's what my firm does all the
time. But it's not sold as a commodity - it's sold as a 'one-off' item,
for a particular need; it won't be copied, or resold. I don't know what
to call this - I used the term 'commercial software' above to mean
software which is copied in bulk for many people to use for a fee, like
Word or Excel. I believe most programmers write software for sale in the
sense you gave above; but I think this is clearly a kind of service,
rather than production of a commodity, so the question of value is not
relevant here.
M$ on the other hand is another case. They are selling (the rights to
use) software which everyone can use and most people don't give a shit
whether others can use the same software. However, M$ being actually
kind of greedy, is trying to create a M$ tax - which is kind of evil
even in a capitalist sense.
Personally I think the the 'MS tax' is confusing. Some people mean by it
that MS is overcharging relative to other software houses, but that's not
what I'm saying (even if it is also true). Also, the word 'tax'
assimilates it to something quite different, which has a real
justification - ie. funding of public works of various kinds. Generally I
don't think there is anything particularly 'evil' about MS - they are
simply the largest commercial software producer, and as such have the role
of public defender of the interests of commercial software producers in
general (eg. in trying to block the laws on use of free software by the
state in Brasil/Peru/Argentina/Catalunha/Spain etc, or in trying to stop
the use of the gpl by universities). If they were replaced in this
position by Sun, for example, Sun would behave in the same way. Rather
than complaining about a specific 'MS tax' I'm saying all
mass-produced software has near zero marginal costs, and no value. So they
have to invent new ways to force people to pay for it, all of which
involve some loss of freedom (and a loss of freedom which increases as
each way to force people to pay fails, so that new ones are needed all the
time).
It has negligeable value in the classical and Marxist economist's sense
of labour value, since the costs of creating the original are a fixed
cost, like the design of physical objects, and the labour involved in
reproduction of software is almost (not quite) zero. It has no value in
the neoclassical sense that the marginal cost is zero in the limit.
However you look at it, it has no value. So, it is also not a
commodity, at least not in the Marxist sense in which it's used on the
'blotter' page, any more than free software is.
IIRC "commodity" is defined as follows:
- a good which is made by independent _private_ producers
- the good has only a value if it is _exchanged_: no exchange, no value
This means:
- the value of the good appears as exchange value
- "value" is comparison of amount of labor of exchanged products
- not single products are compared, but a product with a "mean product"
- "value" and "commodity" are notions of societal mean
Applied to software this means that all labor necessary for development
and production is distributed on all specimen successfully exchanged on
market. It is more or less the same situation as in "normal" products.
No, software is not exchanged - at least not with consumers. I don't see
why the situation is different from TV programs: there is a market among
TV companies for programs, and they sell them to one another. But they do
not sell them to the people who watch them.
Sure they do. The more clear form is pay TV (which at the moment flops
greatly in Germany ;-) ) and the other form is that the consumers
"pay" by accepting being harassed by ads.
No they don't - you do not buy the programs you watch on pay tv. You pay
money to watch them, but you don't buy them - after paying the money, you
don't own the program or any part of it (and if you think you do, save the
program on video tape, and then sell the tape, you can be arrested). The
program is never sold to you; you just pay a fee (a kind of rent) to watch
it. It's not a traditional commodity at all.
However, of course (only?) in Europe you have a rather big set of more
or less state controlled or other public TV stations.
[Note: the above statement isn't entirely true - it is possible to have
a market for program copies based on their real value; you can see it in
Russian street markets, for example. This value is derived from the value
of the CD, depreciation of the CD copier, labour of the person running the
copiers, etc. But that isn't the kind of market we're talking about here]
But it is an interesting example of a situation where actually (only)
the labor put into the copying software is paid.
The only difference is: The development expense goes to 1 and production
expense to 0, while in normal products you have, say 0.5 to 0.5 or 0.7 to
0.3 - neclecting all other "expenses" (which could very, very high: ads,
lawyer etc.).
How can development expense go to 1? If you take a single product, then
its development cost goes to zero as soon as you look at marginal costs
(by the definition of differentiation). I think the only way to salvage
your argument is to say that software necessarily requires continuous
upgrades, so development cost is not a constant. But my counter-argument
would be that continuous development (eg Word->Word97->Word2000->...)
is necessary only to keep people paying repeatedly..
Ah, I guess I understand what you're saying. Once an information good
has been developed all of its development costs are paid and in all
eternity there will be mostly costs for copying it. The bible comes to
mind which has been "developed" ages ago and since then only copied
and translated.
Yes, that's what I'm saying.
Therefore, my counter argument is: Because "commodity", "value" etc is a
societal notion, you cannot compare a single specimen of "software" and a
single specimen of "car". In general and concerning the question of being
a commodity the situation in software is only quantitatively different
from other products.
Counter: because 'value' is a societal notion (linked with the idea that
you have to pay for things because other people work to make them),
and people are perfectly that software has no value, people have no
inhibitions about copying software, taping TV programs etc. It is not
stealing, as taking things with value would be.
All the same, I agree it's 'only' quantitatively different. There's
nothing magic about software itself. But the quantitative difference
between the costs of copying software, or of copying a TV program,
and of copying a chair, is so big that saying 'only' quantitative
makes the difference sound less than it is. When we have home fabbers
that difference will disappear ;-)
Good point. So in a sense (home) fabbers may be thought of as the CD
burners of the future.
:-)
If I'm right, saying 'free software is not a commodity' does not
distinguish it from commercial software, which is also 'worthless as
the air we breathe'. One possible conclusion from that is that all
software should be free, as should all formulae for medicine, all
genetic knowledge, etc. etc. (as opposed to having to create an
equivalent, special 'free' version of all the existing commodity
knowledge).
Well, what keep us off from saying: Human activities are "worthless as the
air we breathe"? For me setting some commodities "free" can only be the
first step. I cannot see, that anybody will be more convinced, if you
argue, that 'software is not a commodity' - by "nature" or what is your
ground? All was societal made...
My ground is also social. If something takes very little work to copy, it
is impossible to make it into a real commodity. It is possible to pretend
it is a commodity (put a CD in a big empty box), but it is still not
really a commodity, since commodities are based on work to produce things
for exchange in a market. This is a social fact, not a natural one.
Well, I'd question that this is much more social than other sort of
property. Property is something formal which always explicitly needs
to be enforced - so it's not natural in any case. You can see that
well in South America where landless farm workers occupy private
property not used by their owners. There are of course countless
examples.
The ideology of this society says that you go to work to make money, to
buy goods made by other people who have also worked to make them. Land
doesn't really fit into this well - land ownership is something older than
capitalism, even if it has adapted to it. That 'form of property' was
originally justified by tradition - my ancestors owned this land, so I do
too.
For most things now, the form of property is justified by work - I worked
to buy this, so I own it. If you have a washing machine and a disk with
Microsoft Word in your house, and I take either, then you will see me as a
thief; the property laws in this case have some social validity. The law
which stops me taking your property limits my freedom, but enhances yours;
and in the end most people accept it as a reasonable compromise. This
is a form of property we are all used to ('unnatural' or not).
But if I copy your disk, leaving the original, you won't see me as a
thief, because I have not deprived you of anything. So for Microsoft to
have me treated as a thief requires a new ideology ('copying is theft')
and new laws which restrict both our freedoms. This is a different form of
property from the old one; not more or less natural - they're all social -
but different, worse, and easier to fight, since it conflicts with the
old one that people are used to.
So what *exactly* is the special thing given by the option of digital
copy? In a way it seems to me that it is even more unclear that by a
pirate copy you are actually stealing something. But isn't this only a
question of how a certain ethic has developed?
I think it is the reverse - the whole ideology of capitalism is that only
things with value (ie. that take work to make) can be stolen. Now we
are being told that copying is theft, too, even though nothing of value is
being taken. The new ideology is incompatible (or at least a very bad fit)
with the old. Since people's lives are based on going to work to create
value and to be able to buy other things with value, they naturally feel
netirely at home with the old ideology. The new one seems like nonsense,
and people generally ignore it, happily copying programs/videos/music etc
as they feel like it. There is no new 'ethic of piracy', although the
IP producers are trying to create a new 'ethic of anti-piracy'.
And
if the core activities of society are not based on commodities, but on a
kind of rent, then this is a big problem for capitalism as a system, which
it will only be able to patch over by more and more unpleasant laws,
destroying more and more of our freedom. Rent is compatible with
capitalism, but can't be the basis for the whole system without the
system becoming something else.
That's a good point!
Another difference: most medicines can be produced very cheaply (the value
of a bottle of pills is mostly very close to the value of a CD of
software), and prices are kept artifically high by IP law.
Yes, the medicine sector is an interesting example. Do you know
exactly how much the "copying" of a medicine costs? Is it really that
cheap?
We need to find a chemist. ;-)
Since a) a bottle of aspirins costs me less than it does to download
mozilla, and b) people manage to create labs to produce ecstacy,
amphetamines, LSD etc in their kitchens with almost no capital, I suspect
in general, very little - the interesting thing would be, are there
SOME medicines which are genuinely expensive to make, or none at all?
Medicine should
be free (not necessarily as in beer, and not without legal controls over
manufacture and testing, but without restrictions caused by IP law). The
countries asking for the right to make their own AIDS medicines at their
true value are doing so on the same grounds as people who say software
should be free. But if you say software/medicine have value because of an
increased immaterial part, it is harder to see such common ground.
Actually I thought about having this issue on the Oekonux conference,
but I don't have the slightest idea whom to invite and for what exact
issue.
Maybe someone from Generics Now?
http://www.genericsnow.org/
(and get them to talk about their banner: "copy = right"
which seems like a perfect illustration of the common features!)
http://www.accesstoaffordablemedicine.com/
is more general, but american only.
Are there any doctors/chemists on the German list? Would it be worth
asking about this therE?
An oekonux argument might be: 'They have value, so it's normal to produce
them as commodities. Unless there are groups of chemists designing new
medicines without pay, there is no non-commodity alternative to the
current system'. Maybe that's unfair to oekonux, but it sounds a logical
consequence to me - oder nicht?
May be that's the practical basis of all steps towards a GPL society:
That knowledge workers of all disciplines in their Free time start to
develop Free goods.
I'm starting to feel that this emphasis is wrong; it depends too much on
generalising from what happened with software to other industries. My
feeling is that, for example, the right to produce generic medicines and
defense of free software against patent law are two sides of the same
thing; and that the success of either (preferably both) makes the
gpl-society a little more possible - even if there has been no 'hobbyist'
type development on the medical side.
Here the question of the ownership of means of
productions comes into play, which is for sure different between Free
Software (PC) and a medical drug (a research laboratory which lots of
expensive equipment - I guess).
Expense is always the argument used to justify any IP industry ("medicines
take millions to develop" (but in practice most recent new medicines were
developed in universities, with tax money, then given to private
companies); 'operating systems take millions to write" (well, we know all
about that one); "films take millions to produce" (and the more money the
worse they seem to be) etc). I would think that the limitation is more
that medicines have to be guaranteed to be tested. A program that crashes
my x-windows session is annoying; a medicine with similar lack of testing
might be fatal. That means part of the initiative has to come from the
state (ie. people working on it have to be governed by legal rules) not
just from individual chemists.
However, gene technology seems to be
pretty cheap :-)-: .
Don't worry, I'm sure they're working at making it more expensive ;-)
best wishes
Graham
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http://www.oekonux.org/