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Re: [ox-en] Above average profit and Red Hat



Hi Johan!

Last month (36 days ago) johan soderberg wrote:
I have tried to figure out a Marxist respons, to the blind belief
that business models based on free software are predetemined, in
Shumpeterian creative destruction, to overtake IP monopolies as a
dominant form of capitalist production. Comments anyone?

Some.

Concept of `falling rate of profit? and above average profit is
helpful. Labour is the only source for creating surplus value. It is
possible, however, in some circumstances, for the capitalist to
acquire more surplus value than he employs labourers. Sometimes, the
capitalist manages to position his venture, so that surplus value
produced by labours employed by other capitalists, will flow to his
pockets. Primarily, extra-profits are harnessed when a capitalist
introduces new process technologies (fixed capital). By
rationalising and automating a production line, the expense for
producing a unit falls below the social average paid by other
capitalists for making the same unit. The `bonus profit? is only
temporal, as other capitalists will catch up with the same
technological advancement. When most capitalists have adopted the
superior way of doing things, the average production cost will even
out at the new, lower level, and the extra-profit vanishes for the
individual capitalist.

Yes.

Point is, surplus value is transferred to the degree it is a
deviation to the norm.

I do not really understand this sentence.

The success of Red Hat could be looked upon as a variation on this
theme. Companies like Red Hat and Cygnus hire labourers, to develop
source code, to provide supportive services, and to brand the
company. These activities generate some surplus value. However, the
input of waged labour contributed by the company is marginal to the
vast mountain of gratis, collective labour that constitutes the core
of the software. In this way, the price for a free software product
is cut far below the social average for an equivalent product made
within the intellectual property regime.

It's perfectly possible to see it that way. However, with Free
Software there is a difference to the situation above. The labor is -
at least to a high degree - not payed by anyone. For sure not by other
capitalists but if at all by private people who do it in their
non-paid time. So this is not the "injustice" you can see above. I
think this means something - though at the moment I can't say what it
is exactly.

In the case of free
software-based companies, extra-profits derive not from the ability
to reduce work staff by means of technological innovation, but by
emigrating paid labour to un-paid labouring communities by means of
organisational innovations.

Feminist research could help because the situation is similar to the
work called reproduction work in this discourse. Exploitation of the
so-called Third World also comes to mind.

It is an open question whether the
IP-dependent section of the capitalist class (Microsoft, Hollywood)
can follow suit and close the gap in production costs, without
disbanding their own social existence in the process.

May be this is the core question whether GPL society will be
inevitable or not.

Microsoft?s
`shared source? policy, where selected customers are given
restricted access to Microsoft source code, is an attempt to close
in on the distance in costs between propertarian and free software
coding. However, the desire to stay in control will probably cripple
such efforts.

The "shared source" initiative is IMHO just another M$ marketing gag.
They start to need to embrace Free Software - however, as you say they
are not really able to.

I?m inclined to believe that they cannot appropriate
the free software model and sustain a high profit level. In that
case, Cygnus/Red Hat extra-profit business model will continue to
thrive for a long time, living from the differential level of
IP-high cost production.

But Cygnus/Red Hat has the same problem as any Free Software profit
maker: Everybody can do it like them because the software is Free to
use for anyone. This is a completely different market than that of IP.

Anyway I'm rather sceptical whether Free Software is able to generate
profits to any considerable degree. The distributors are a bad example
- especially since they more and more tend to neglect their original
basis of bringing GNU/Linux to the people in favor of selling to
firms. IBM may be a counter-example. I'd really like to know details
about their numbers.


						Mit Freien Grüßen

						Stefan

_______________________
http://www.oekonux.org/



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