[Fsf-friends] Some Differences Between Free and Proprietorial Software (by Guido Sohne)

Frederick Noronha (FN) fred@antispam.org
Sun Nov 6 00:11:23 IST 2005

An interesting article from Guido Sohne guido at sohne.net on the GKD
mailing list. -FN

-----Original Message-----
From: On Behalf Of Guido Sohne
Sent: November 4, 2005 6:26 PM
To: gkd at milhouse.edc.org
Subject: [GKD] Some Differences Between Free and Proprietary Software

Dear GKD Members:

I wrote this with the intent of informing decision makers who are facing
a decision of 'open source' versus 'proprietary software' to understand
the choice they are making by explaining the context in an approachable

-- G.


Some Differences Between Free And Proprietary Software

* Introduction

This article is an attempt to dissect some differences between free and
proprietary software in an accessible manner, free from jargon and the
techno-gobbledegook dialect favored by some technical people.

* Two Different Worlds

Proprietary software is created by organizations that seek to maximize
profit by restricting production. The usual and common objective of such
organizations is to operate and maintain a continued revenue stream, for
maximum profit. Restricted production and the continued revenue
objective result in a dependency syndrome for users - they can't ever
stop paying.

Proprietary software is mainly provided by companies that use the
access-restrictions of copyright laws to maintain well-defined segments
across their markets as well as to maintain barriers to market entry by
competitors as a means of maximizing revenue across market segments by
trying to minimize the costs of dealing with competitive threats, thus
helping to maximize profits.

>From a modern microeconomic perspective the business secret aspect of
intellectual property is only one part of a multi-faceted set
ofprofit-maximization tactics firms can and do employ, in either freely
competitive, oligopolized or monopolized markets.

Other related tactics include marketing and support expenditures that
can make market entry more expensive or that can help lock-in consumers.
Firms engaged in such behaviour, often are unwilling to share their
technologies, especially those beyond the development capacity of most
of the market, as an additional means of restricting competition by
restricting the availability of the product.

Free software, on the other hand, has no profit motivations as its basis
for organization. Instead, free software seeks to ensure that there are
as few restrictions to software production as possible. Free software
does not make a distinction between the level of access granted to the
product given to its users and that given to its developers.

Free software maximizes the potential for production to occur.
Unfettered by the profit motive and guided by higher ideals of freedom,
sharing and communal ownership of knowledge, free software is more
oriented towards the product and its development and far less attuned to
anti-competitive business strategies, necessitated by its goal of
minimizing restriction to the software product.

It is important to note here, that this sort of anti-competitive
behaviour described is not limited to the software industry but rather
permeates much of the status quo for business practices in industries
that produce digital goods (software, music, film). The popular
grassroots movement that is the basis of the increased usage and utility
of free software is at the core, a rejection of this anti-competitive
behaviour and this is evident in their clarion call for increased

* Licensing of Software

Software licenses are contracts attached to the software, either in raw
or finished form, that determine the expectations, rights and
obligations of the parties to the contract. As used by software
producing organizations, licenses are primarily a means to either
restrict, or ensure access to the product in both its raw and finished

Restricted production licenses usually differentiate between access to
the product in its raw form and in its finished form. Such licenses
often only grant access to users on the basis they are the only
permitted user of the finished form of the software product that has
been given access to the software. Other users must also buy licenses
for continued revenue and maximum profit.

Free software licenses operate by removing the distinction between raw
and finished form, emphasizing the raw form as the actual software
product.  If the software comes in finished form, the raw form of the
software must be present or readily accessible. This is in line with the
free software objective of ensuring that there are as few restrictions
on production as possible.

Free software licenses often block restriction of the software product
by restricting use of the software to exclude scenarios or situations
that result in restrictions being placed on the software that would have
adverse effects on production.

* Locked In Competition For Users

Software licenses are almost always centered around the user of the
software. On one hand are organizations seeking maximum profit and on
the other hand are organizations seeking maximum access (unrestricted
access to the software product).

However, developers are those with the ability to utilize unrestricted
access. In the free software world, the user can be a developer too. In
the proprietary software world, other developers are often 'the enemy'
because it is only other developers who can create a competing product.

And in between this war between worlds of developers, stands the hapless
user ...

Significant resources are devoted to proprietary software in order for
it to appeal and compete for the expenditure of users. Restricting
users' access to the software by supplying it solely in finished form
causes more effort to be placed into making the software usable by
ordinary users (as opposed to developers).

In this manner, proprietary software evolves to be biased heavily to the
ordinary user, often at the same time making it hard or impossible for
other developers (who are also users of the software) to work with the
software in its raw form. The proprietary software approach of
restricting production to finished form also biases the productive
options available to overwhelmingly favor the organization owning the
software product.

In the case of companies like Microsoft, whose software comes
preinstalled on the vast majority of computers being sold, the user
often has no choice but to use the software. Any other route often
results in more work for the user. They have to go and find some other
software and get it installed. When they do so, they encounter
incompatibilities, which incidentally, are in favor of Microsoft
maintaining its monopoly by making it easier just to stay with Microsoft
products, which of course, work well together.

The resulting state of affairs is in total contradiction to the free
software goal of ensuring minimal restrictions on software production
and software choice for the end user or individual developer. Free
software accomplishes this by predominantly taking a 'laissez-faire'
approach to ordinary users as well as to its developers.

The only restriction faced by developers when producing free software is
in integrating their own improvements to the source code. This
restriction arises from the free software goal of maximizing the
efficiency of software production.

If there are no restrictions on changes to the raw form of the product,
it quickly becomes buggy or unstable unless the developers are of
equivalent skill or are familiar with the code involved, otherwise it
devolves into a hodgepodge that just doesn't work.  Only well thought
out and well tested changes should ideally make it into the software
product, and even this is best done in a gradual, incremental manner.

This necessary mechanism for restricting software production in a manner
that maximizes efficiency takes the shape of the other developers of the
software, who by fiat, consensus, war, politics or rewriting the
affected code constitute a peer review mechanism operating around the
goal of production efficiency within their common visions and

Developers have the choice to do what they please and often prefer to do
what pleases them at the expense of the ordinary user, who is assumed
not to understand the specific benefits of the particular improvement.
On the other hand, users or organizations have the opportunity to
encourage developers by giving them incentives to work on improvements
preferred by the user.

This interplay between the two types of users (technical and
non-technical) of free software evolves into a symbiotic relationship,
where the developer has no reason to work if no one will use his work,
and the users have no choice but to depend on a developer to do what
they cannot do for them. Both benefit, each contributing to the
resources needed for production.

* Differences in Organization of Labor

The mode in which labor (developers working to maintain or enhance the
product) is organized differs between the proprietary and commercial

Organizations producing proprietary software, being mostly driven by the
profit motive, and restricting production need to be able to control
ownership of the software and at the same time utilize developers to
make changes or improvements to the software while maximizing profit.

Organizations producing free software are often places where individuals
interested in producing the software are employed because the
organization and the individual have aligned interests for the software.

This is because the free software development process is organized on
the basis of individuals. Organizations are represented only by an
individual, and such individuals have influence proportionate to their
contribution to the software product. Free software often operates as a
self organized, developer centric culture resting on individual
reputation and esteem in the eyes of the rest of the team.

Comparing the two methods of production, it could be concluded that
proprietary software developers seek to maximize income while free
software developers seek to maximize their contribution to, and
influence over, the software product itself.

* Mode Of Production

In order to achieve this, these organizations hire developers and pay
them for their contribution to the software product. Done as a work for
hire, the ownership of the product, primarily exercised through
copyright, remains with the organization that hired the developer.

The cost of developers and the general cost of doing business translates
into a total cost for production that must be recouped by sales to
users. The price at which the product is sold depends on how many users
choose to use the software, or how many users are compelled or coerced
to use the software.

With free software, the general cost of doing business is often
incidental and not central to the objectives of people or organizations
producing it. Maximum access to successful free software products often
results in multiple organizations making changes or contributions to the

If one of the organizations participating in the free software
development process disappears or changes its objectives and abandons
the software, the other organizations are not affected. At the same
time, the developers working on free software are often still available
to different degrees of availability even when their organization
collapses, because the raw form of the software product is not
restricted to the organization only. They can continue working and may
even join the organizations remaining.

Due to this, the free software development process results in software
products that exhibit robustness even in the face of adverse economic
circumstances. In such cases, the efficiency of development is even
increased because the developers will have more time to work on changes
to the products that they prefer, while being underemployed with respect
to potential output. The ability to utilize underemployment effectively
is a strong contributing factor to the efficiency of the free software
development process.

Additionally, free software development reduces the perceived cost of
developing software by distributing the cost of development across all
the participants in the process. This is in contrast to the proprietary
software development process, where the cost of development is
distributed across the user base and results in lower prices for the
user. These lower prices are partly due to the increased supply due to
the absence of restricted production.

* Conclusion

Proprietary and free software are different approaches to producing
software products that are competing for users and resources.

Proprietary software development restricts access to the software
product by prohibiting copying but free software development encourages
access to the software product by prohibiting restrictions on copying.

Proprietary software development is most efficient at maximizing profits
but free software development is most efficient at maximizing

The choice is always up to you, the user of the software, in how to
exercise your interests.

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