Subject: Re: freedom and human kindness (was Re: Open letter to those who believe in a right to free software)
From: Bernard Lang <>
Date: Mon, 8 Nov 1999 11:36:07 +0100

On Mon, Nov 08, 1999 at 01:13:27PM +0900, Stephen J. Turnbull wrote:
> >>>>> "Bernard" == Bernard Lang <> writes:
>     Bernard> Given the (naturally monopolistic) structure of the
>     Bernard> software market (at least where
>     Bernard> infrastructure/commodities are concerned),
> Please don't use the term "natural monopoly" to refer to software where 
> I can hear it---it confuses me.  :-)  It is not a natural monopoly in
> the technical economics sense because
>     1.  property rights are a legal creation; without property rights
>         there is a clear second-mover advantage (avoiding sunk costs of
>         development).  Not to deny that first mover advantages exist,
>         but the cost advantage in a given product goes to copycats.
>     2.  There is (ex post development) no social benefit to the
>         monopoly; the duplication of development costs can be avoided
>         in many cases by the simple expedient of not granting
>         intellectual property rights.

Let me stand by what I say (thought I had not thought it out in the
technical sense you attach to the term):

  - zero marginal cost is independant of property rights
  - control of source code is independant of property rights
  - control of standards by
         shifting standards
         technical barriers
    is independant of property rights
  - positive network externalities
      upstream with suppliers of applications, support and plugin
      downstream with customer going to the winning supplier
    are independent od property right

All these contribute to making it a monopoly.

  So the only thing protected by property rights is the prohibition of
free copying. You may, rightly, consider this as unnatural ... but
then there is no such thing as a natural monopoly on immaterial goods
[unless they start selling equipment with unique id, in which case
copying prohibition will be enforceable by technical means].

  I was clearly refering to "proprietary software", hence assuming a
context with at least copyright. Given such a context, the rest of the
phenomena are natural. But I am willing to use any other word, if you
can suggest one.

... I do not think I understand your second point.

... and my point can be restated as: given the monopolistic effect of
the proprieatry approach, it may be to the best advantage of the user
- for strategic reasons - to prefer not to deal with a proprietary
company [who could, for example, make later versions of its GPL
software proprietary, if no community has formed around it]. The GPL
does not apply to authors, only to licencees.


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