Subject: Re: [ppc-mobo] Re: GPL-like hardware design license?
From: "John Metzger" <john_metzger@worldnet.att.net>
Date: Wed, 06 Oct 1999 12:55:25 -0700

>     >> If the designs were publically available, they would be
>     >> useful in education.  Etc, etc.
>
>     John> Sure, but where's the profit in that? I'm not part of the
>     John> subsidized education establishment.
>
>     >> The point is, where's the _cost_ in that?  _No cost to you,
>
>     John> No, there is a cost. The cost to me is that competitors get
>     John> to sell hardware for less than I can because they get to use
>     John> the R&D I paid for at no cost.
>
> There is an opportunity cost to the public of not releasing the designs to
> educational users for free; the loss of the students' chance to study
> them.

Sorry socialism doesn't work. You can make the same argument that schools
should get free food, free beer (for the teachers - well the students too,
after all the students do get free beer in Germany!) and free text books,
etc. I'll make the argument that all teachers should work for free because
it's an opportunity cost to the public schools if they don't.

The more significant issue is that if public disclosure means the product
won't happen then the schools not only won't have the design to study but
they won't have the product (nor the taxes the product generates)! You are
saying that because the design isn't public everyone is better off without
the product. I disagree.

> But there is no opportunity cost to you of simply releasing the design
> to use in education (only),

How do I keep potential competitors from using the information? Once the
information is public it's much harder to keep competitors from using it.

...
> And, of course, software also has manufacturing and distribution
> costs.  Howcum Red Hat can charge 25 to 50 times as much as CheapBytes
> for a physically identical CD-ROM?  We're still debating that one;
> nothing that I've seen suggests that there would not be analogous
> possibilities in hardware.

Yes, Apple's the proof of that (sort of... a hardware company that over
charges for its hardware and is still in business.)

>     John> Explain how. I'm all ears.
>
> You find a way of restricting the "no-fee" use to educational purposes.
> That's _physically_ possible.

How? At what cost? License agreements require lawyers to enforce. It costs
money to sue to prevent theft of IP. Keeping it secret is cheaper.

> Eg, there is the Aladdin-style license (Ghostscript) which basically
> says that if you publish modifications under the same license, you can
> do anything with this idea or its derivatives---except make money.  If
> you want to make money, you gotta talk to the boss first (and get a
> license with different terms, perhaps in exchange for royalties).

And what will Aladdin do if someone violates that agreement. How will they
even know if someone lifts some portion of the code and uses it in some
unrelated product to make money?

...
>     John> If I have to pay for them out of my pocket I need the money
>     John> to be replenished because, unlike Gates or Universities, I
>     John> don't have infinitely deep pockets. I don't see what is so
>     John> hard to understand about that.
>
> I understood the fundamentals, oh, while I still counted my age on my
> fingers.  It doesn't take a PhD in economics to understand your point.
> So maybe you should consider the possibility that you're missing mine?

You haven't answered my one fundamental question. If I pay for improvements
to the hardware design, how to I get that back with interest, IF my
competitors can just freely use the design improvements? Explain how that is
going to work. Explain how it is you will pay $200 more for my hardware,
when you can get the EXACT same thing from someone else for less. Yes, I
know Red Hat does it with a $50 product that could cost $5. How would the
same apply to hardware that cost $1000 or $800? (and please note that not
even Apple can't do it if their designs are clonable...)

> It is you that is refusing to understand that the whole point is that
> although we need to find third parties to pay for at least some of the
> investment, we don't necessarily need to do so according to the tried
> and true business model of using a monopoly on an idea (= design) to
> recover capital costs (= plant).

You haven't provide the new model. Please do so. I'm all ears.

> That old model does work well, and if your primary worry is about
> money, I recommend that you abandon discussion of free licensing and
> use a purely proprietary model.  Free licenses have little to offer
> you, except that if others use them, there may be a free ride.[1]

My interest in the OpenPPC project is to see the widest possible adoption of
PowerPC processors, in as many product as possible. It is not to be sure
that every derivative work is a totally open (hardware) design. If allowing
third parties to do anything they please with the design means that the
world is populated by more PowerPC chips then it doesn't bother me in the
least that such products are closed designs that used parts of the OpenPPC
projects designs as starting points.

If I am going to be one of those third parties trying to create viable
products then yes my concern is with money, the more the better. Because the
more money a product generates the more money I have to reinvest in new
products.

...  [whole bunch of theoretical drivel snipped]

> ... you also assume the classic business model
> of monopolizing an idea to amortize plant investment is the only
> possible one.  Then, you've already assumed away open licenses.  Game
> over.

Here's the deal Steve. You pay (what ever it costs) to produce a PowerPC
north bridge with the following specs and a new motherboard that can use it
(along with other improvements to the south bridge such as VIAs or SiS..)
and publish the designs so I can manufacture them and sell them. When you've
got that done let me know.

The north bridge has to support 4x AGP, PC133 RAM, either the 60X bus or MPX
bus (strap selectable), and has the following built-in the chip: an ATI Rage
Pro graphics controller, a 10/100 Ethernet controller, USB (including the
PHY), a 1394 (including the PHY), what the heck since your paying, throw in
a SCSI controller too. It also has to have power management functions, DMA
channels, an interrupt controller, a RTC and at least 4 way SMP support. It
has to support two independent PCI buses, one 32 bit/33Mhz, one 64
bit/66Mhz. It should only cost you $500,000 to $1,000,000 to do that. When
you have it done give all the design files to me so I can use them to build
the hardware.

If I had Bill's money I'd do it and give it all away. But I don't have that
kind of money to burn, er donate to the cause. Sorry I haven't won the lotto
yet. Perhaps one of those new billionaires from Red Hat would like to fund
this kind of project.

>     John> Actually not. I can't use GPLed software to build some
>     John> products precisely because I have to publish the changes I
>
> There you go again.
>
> You have _decided_ not to use GPL'd software to build some products
> precisely because you _believe_ that none of the business models you
> are _aware_ of permit you to recover the financial investment plus a
> reasonable profit if you publish the necessary changes to the source,
> which is required by the GNU GPL.

That's correct and no one has shown me the counter example that works for
hardware or even proposed how it might work. Further the choice is not
always mine. Clients aren't eager to spend a million dollars on engineering
and then put the results out in the public so anyone can use them.

> There are several hypotheticals in there, all of which are under
> attack in discussions of free software.  I admit that I must challenge
> those hypotheticals; if you will not admit they need defense, I have
> nothing further to say to you.  But I will not permit you to sweep
> them under the rug and declare victory without pointing out your ruse.

I am not interested in hypotheticals or theoreticals. I'm interest in
practicals.

> BTW, my "economy of ideas" does not need to subsume the economy of
> money.  Just because you can't cover the ante doesn't mean that others
> can't.

That's correct, but so far neither Bill nor anyone from Red Hat has stepped
forward with the money. Neither is IBM willing to create the advanced north
bridge I mentioned above (nor is Motorola even though it would help them
sell more PowerPC chips). They are willing to do a low budget design that
uses major parts of a previous design, but even they, with the possibility
of recovering some of those costs from selling more PowerPC chips aren't
going to put the money out until someone starts selling a whole bunch of
boxes based on POP or some other (proprietary) design.

And my discussion has been focused on my investing MY money, not getting Red
Hat to pony up some cash.

>     John> make to the software. That means the use of that software to
>     John> create new products is limited more than it needs to be.
>
> But conversely, if the new products are proprietary, the use of those
> products to create new products is limited more than it needs to be.
> In fact, it's a monopoly.  Ugh.

So if the choice is a "monopoly" product that used some part of a public
design, or no product, we're better off with no product. (and that is the
choice. A product may be possible IF it can leverage a public design AND can
be kept proprietary, but may not be possible at all if I have to reinvent
everything from scratch, i.e. not use any part of the public design, but
have to reinvent it all.)

And technically it's not a monopoly product. Anyone else can create a
similar product, they just don't get to use other people's money
(investment) to do so.

...
>     >> And other people simply disagree with you.  They believe that,
>     >> at least for the domain of software, the GNU GPL is a more
>     >> effective way of creating large amounts of useful, economically
>     >> valuable products and making them available to users and
>     >> developers of derivative products than the alternative
>     >> licenses.
>
>     John> We'll have to disagree on that one.
>
> If you aren't going to produce or respond to analysis, let's.

There hasn't been much that is convincing.