Subject: Economics of software distribution
From: jla@GNU.AI.MIT.EDU (Joseph Arceneaux)
Date: Thu, 18 Mar 93 14:07:44 -0500

   Date: Thu, 18 Mar 93 02:31:33 -0800
   From: gnu@CYGNUS.COM

   In the commercial software world, private funding is called "investment".
   It's still an investment, whether the result is free or proprietary.
   The question is:  what result does the investor expect from their
   investment? 

   In the "mass market software" realm, the logical conclusion is that
   they expect to get profit from selling the software.  I think that this 
   conclusion is wrong.

This depends highly on the ultimate plan of the buisiness.  It remains
true that that investors can expect an immediate $n00/copy return on
investment in a successful commercial program, which they will not get
of the software is free.  I have seen potential investors say "Great
idea", and then leave the table when "free software" was mentioned.

I think the exceptions to this are when that piece of software is a
stepping stone in a larger strategy, such as selling applications for
DOS, establishing a standard, or generating support contracts.

Joe