Subject: Re: offering pre-purchases
From: "Stephen J. Turnbull" <>
Date: Fri, 12 Oct 2007 18:19:43 +0900

Don Marti writes:

 > > He's not talking about $75,000 software, though, is he?  Joel makes
 > > exactly the same kind of comparison for his inexpensive proprietary
 > > software against the expensive proprietary software.  I put it to you
 > > that Matt is not seeing the effect of his software being open source;
 > > he's seeing the effect of it being relatively inexpensive.
 > The Alfresco prices are still in the five digits,
 > though, well over Joel's pricing dead zone.

OK, maybe there's a lot to the claim that open source drives down
transaction costs.  But it's still way cheap compared to Rational or

 > > Sigh, I guess that definition is common enough, but it really hinders
 > > communication because it becomes hard to talk about "pure" marketing.
 > What's a better definition of marketing, and
 > what do you call the rest of what the "Marketing
 > Department" does?  I'd be happy to split up the
 > vague term "marketing" into separate terms for (1)
 > deciding what to make and what to charge for it and
 > (2) communicating about it with a view to persuading
 > people to buy it.

Generally biz school people use "strategy" for deciding what to make,
"marketing" for determining who the customers are, what they might
pay, and making sure they know about you, and "sales" for direct
contact.  "Marketing" expenses are overhead, "sales" are direct
costs.  "Sales" is often grouped inside of marketing in organizational
terms, but the distinction between overhead and direct costs is pretty
important for understanding the activities.

 > >  > You could just do a prediction market on will the project
 > >  > accomplish some goal -- but we had that thread already.
 > > 
 > > No, you can't.  First, Tom is barred from trading in the usual way in
 > > that market, it's insider trading.  Even if there's no legal
 > > restriction, it would kill his rep.
 > Your "insider trading" here is a victimless crime
 > if all particpants know that researchers are playing
 > the market.

The "usual way" of trading is *anonymous*.

 > A researcher who needs living expenses or money to
 > cover research costs could form an LLC with silent
 > partners who would share in the trading gains if any,
 > and agree to pay the researcher a salary and/or cover
 > the lab budget.

Hey, if they're willing to pay Tom a salary, *he* wouldn't need to be
in either the prepurchase market or the prediction market.  It's
precisely because they are *not* willing that this thread happened.