Subject: Re: A few here may have an opinion on this
From: Ian Lance Taylor <>
Date: 28 Oct 2002 16:17:45 -0800 writes:

> The real issue is how best to create value with 
> software.  In the proprietary model, it's pretty 
> clear how a business creates value because it shows 
> up on the books as license revenue and profit,
> generating tax revenue for government and equity
> for shareholders.  In the OSS model, you give away
> the license which means little or none of the value
> of the software shows up on your books; it instead
> shows up as higher profits elsewhere in the economy.

This appears to assume that all value shows up as profit, which is not

> As Stephen Turnbull has pointed out, it's impossible
> to measure which model creates more value faster.
> As a successful software entrepreneur, I've pretty much
> voted with my feet.  I know that investors are only 
> in this for the money, and it's hard enough to 
> build a successful proprietary software company without 
> handicapping yourself by giving away the IP.  I don't
> believe the solution to this dilemma is more faith,
> which is why I have asked for verifiable examples
> of successful OSS businesses.

It's hard to dispute that it's easier to build a business around
proprietary software.  That's not to say that there are no advantages
to building a business around free software, but in general, in most
markets, proprietary software is clearly a better bet for the
individual entrepeneur.  Of course it's worth remembering that most
pure software companies of any type don't make any money; don't be
wholly misled by the 800 pound gorilla.

> Now back to the public policy point.  I want the 
> government to promote policies that increase overall 
> wealth in the US.  I do not see OSS as a mechanism for 
> quickly creating high value software; historically it 
> has only been successful at eventually producing the 
> lowest cost competitor once a market space becomes 
> commoditized.  Given that, I don't think it's 
> appropriate for the US government to tilt the playing
> field in favor of GPL and against proprietary software.
> I'm more agnostic about BSD-style licenses since it
> is easier for companies to add value and actually
> capture the value on their balance sheets.

Hmmm.  I'm also a US citizen, and I don't want the government to
promote policies that increase overall wealth in the US.  Where it's
appropriate for the government to get involved, I would prefer that
the government promote policies that increase the average standard of
living in the US.  Which license is more appropriate for this is
difficult to know, but it's certainly possible that the GPL, which
produces code which anyone may pick up and use, is a better choice.