Subject: Re: "Reasonable Profits"
From: Russell Nelson <nelson@crynwr.com>
Date: 1 Sep 1998 03:07:36 -0000

D. V. Henkel-Wallace writes:
 > The second is the traditional corporate model.  This model says "revenues
 > should grow non-linearly with the labour expended."

Whose labor?  Do you mean costs?  I can think of many businesses where 
the revenues grow linearly with the cost expended.

In a free market, the only way to get rich is to sell the same thing
repeatedly.  One way to do this is to sell the same organizing
services to many people (usually called employees) at the same time.
I think this is the "non-linearly with the labour expended" you refer
to above.

 > I wonder about the opposite problem.  How does one build sufficient brand
 > equity with libre (or gratis) software?   That's one way to spike the
 > exploitation problem -- but it's tough to swing on the consultant model.

Yup.  It's a hard problem, but other people are solving it in other
segments of the economy.  Maybe the profit margins on freed software
are really small.  But so are the margins on the things Wal-Mart
sells.

It comes down the the services that RedHat sells.  If they can perform 
a service once (e.g. identifying a reliable Linux kernel version, or
creating a RPM of some free software package), and sell it many times
under the RedHat label, there's your brand equity.

-- 
-russ nelson <rn-sig@crynwr.com>  http://crynwr.com/~nelson
Crynwr supports Open Source(tm) Software| PGPok |   Freedom is the primary
521 Pleasant Valley Rd. | +1 315 268 1925 voice |   cause of Peace, Love,
Potsdam, NY 13676-3213  | +1 315 268 9201 FAX   |   Truth and Justice.