The Software Industry
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I think you make a good point.
Richard MacCutchan wrote:
When you use someone's software product, in most cases it is to keep your business going.
However, if you compare this to a car, the analogy falls apart bec it would mean we would charge Uber drivers, delivery drivers, etc. more because they earn income using the product. But, still you point is a good one.
If you shoot video in a National Park -- and someone, anyone ever earns money from that video -- the National Park Service wants some of that money. It ain't right.
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No. The extended warranty would be an optional cost of acquiring the vehicle. Profits are what remain after all costs are deducted.
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So, if I buy a truck from General Motors for my freight carrying business, I should share my profits with GM?
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I think you make a good point.
Richard MacCutchan wrote:
When you use someone's software product, in most cases it is to keep your business going.
However, if you compare this to a car, the analogy falls apart bec it would mean we would charge Uber drivers, delivery drivers, etc. more because they earn income using the product. But, still you point is a good one.
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Back in the day when you bought software, you installed it and it never changed after that point. Now most software is updated regularly for bugs and security reasons. Those updates are work for the software company and it makes sense that the end user would have to pay for that. I'm not defending that Oracle licensing though. That sounds pretty shady and desperate.
Kschuler wrote:
when you bought software, you installed it and it never changed after that point.
Well in over 50 years in this industry I never worked on any software like that. The frequency of updates may not have been as often as now, but it still happened quite regularly.
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Software is a product. Much like TV, automobile, washing machine, etc. The latter are tangible while software is intangible but that is not an important difference. Once upon a time, when you bought a software, you paid one price for it, no matter how many persons in the purchaser company used it. Then they decided to charge according to the power of the processor the purchaser company used. This is like saying you have a larger living room and so the TV is higher priced. Then they decided to charge price/user. This is akin to the price of the TV or washing machine being dependent on how many persons are in the household. Now, Oracle has gone one step further and its Java licenses are based on the number of employees in the purchaser company, including janitors or messenger boys they may employ. If a customer refuses to accept the new terms, which yield hundreds of thousands if not millions of dollars more in revenue to Oracle, Oracle is threatening an audit of those companies to determine if any of the contractual terms are violated by the purchaser. Companies have sprung up to assist the purchasers in questioning the findings of these audits. What makes software different from common household goods such as TV, automobiles, etc? What justifies differential pricing based on number of users? Other than the greed of software vendors.
Vivi Chellappa wrote:
What justifies differential pricing based on number of users?
I don't agree with differential pricing when it comes to greed. But, I think scaling pricing is great if it's done ethically. It gives smaller companies a chance to play ball. But, only if done ethically and not out of greed. Dunno about this situation in particular. I will say though that greed based pricing differences have been around for a while now. Hotels, Airlines, etc. will charge you more if you buy a ticket from an affluent area, for instance. So, the greed part is nothing new it's just being expressed through software now that the tech giants have fully embraced the dark side.
Jeremy Falcon
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Back in the day when you bought software, you installed it and it never changed after that point. Now most software is updated regularly for bugs and security reasons. Those updates are work for the software company and it makes sense that the end user would have to pay for that. I'm not defending that Oracle licensing though. That sounds pretty shady and desperate.
Except now every time I turn on my TV I have to install an update... literally. And to top if off, my TV shows me ads. All for updates I never wanted for crap I don't use... just to watch TV.
Jeremy Falcon
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But the concept is analogous. Just some people give special "clearance" to certain things like tech and the medical industry. And it makes sense that we devs would consider software special. IMO it shouldn't be that way though. One could think of software like a tool. And if I buy a screwdriver as a carpenter, should I share profits then? Don't get me wrong, some profit-based models aren't always bad. For instance, some game engines are free to use until after the company makes money off the game. Which makes the barrier to entry low. If it's done ethically though and not from a place of greed. But, this day in age, everyone is all about getting recurring payments from customers. Hell, they want you to get a "subscription" when going to the car wash now. The idea of just buying something is become a relic of the past... all for greed.
Jeremy Falcon
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If you shoot video in a National Park -- and someone, anyone ever earns money from that video -- the National Park Service wants some of that money. It ain't right.
Can I get in on this? I want some of the money for watching the video. :-\
Jeremy Falcon
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In the past (and even now), there was/is an annual maintenance contract with the software vendor that paid for upgrades and bug fixes. It is like buying an extended warranty for your car. My question remains: what justifies per-user pricing? PS. I brought in Oracle as an example of egregious business practices that is enabled by per-user pricing.
Vivi Chellappa wrote:
what justifies per-user pricing?
If a school purchases text books, they need to pay for each copy that they buy, even though the content of each book is the same. What's the difference with software?
The difficult we do right away... ...the impossible takes slightly longer.
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Software is a product. Much like TV, automobile, washing machine, etc. The latter are tangible while software is intangible but that is not an important difference. Once upon a time, when you bought a software, you paid one price for it, no matter how many persons in the purchaser company used it. Then they decided to charge according to the power of the processor the purchaser company used. This is like saying you have a larger living room and so the TV is higher priced. Then they decided to charge price/user. This is akin to the price of the TV or washing machine being dependent on how many persons are in the household. Now, Oracle has gone one step further and its Java licenses are based on the number of employees in the purchaser company, including janitors or messenger boys they may employ. If a customer refuses to accept the new terms, which yield hundreds of thousands if not millions of dollars more in revenue to Oracle, Oracle is threatening an audit of those companies to determine if any of the contractual terms are violated by the purchaser. Companies have sprung up to assist the purchasers in questioning the findings of these audits. What makes software different from common household goods such as TV, automobiles, etc? What justifies differential pricing based on number of users? Other than the greed of software vendors.
Vivi Chellappa wrote:
What makes software different from common household goods such as TV, automobiles, etc?
I'd say you're not giving enough weight to the distinction between tangibles and intangibles. Tangibles have limited lifetimes; automobiles, TVs, microwave ovens, smart phones, groceries, etc., eventually need replacing, often because some folks like to have the latest 'thing'. There's an on-going market for new widgets. The sales model for tangibles is not sustainable for software over time. Once most people who need a particular software app have it, it gets harder to sell them upgrades especially as the product matures, and the market for new purchases is never as big as the initial sales. I don't know that this justifies the model nearly every software company has adopted over the last decade, but I'm pretty sure that's the reason behind it.
What justifies differential pricing based on number of users?
If you're buying wine for an evening, are you buying one bottle for you and your partner, or for a party of 50? You gots mo' people, you needs mo' wine. That's where the gap between tangibles and intangibles is negligible.
There are no solutions, only trade-offs.
- Thomas SowellA day can really slip by when you're deliberately avoiding what you're supposed to do.
- Calvin (Bill Watterson, Calvin & Hobbes) -
Thankfully it only applies to Oracle OpenJDK, which is essentially Standard Edition. I'd be surprised if any large companies continue to use it, at my last place I had a migration task to move all JDK installations from SE to the Adoptium OpenJDK versions. Took me all of about a day and probably saved the company a lot of money since the company was international and had a lot of employees. I suppose the only companies interested would be those specifically wanting the Oracle support, but is it worth the cost? I don't think so. Some other platforms do similar things where they charge different models based on the size of your business, either by the number of employees or the average annual revenue.
Chris Copeland wrote:
charge different models based on the size of your business, either by the number of employees
See, if it's a site license, charging by the number of employees makes some sense to me. Otherwise, it's just gouging.
Check out my IoT graphics library here: https://honeythecodewitch.com/gfx And my IoT UI/User Experience library here: https://honeythecodewitch.com/uix
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Software is a product. Much like TV, automobile, washing machine, etc. The latter are tangible while software is intangible but that is not an important difference. Once upon a time, when you bought a software, you paid one price for it, no matter how many persons in the purchaser company used it. Then they decided to charge according to the power of the processor the purchaser company used. This is like saying you have a larger living room and so the TV is higher priced. Then they decided to charge price/user. This is akin to the price of the TV or washing machine being dependent on how many persons are in the household. Now, Oracle has gone one step further and its Java licenses are based on the number of employees in the purchaser company, including janitors or messenger boys they may employ. If a customer refuses to accept the new terms, which yield hundreds of thousands if not millions of dollars more in revenue to Oracle, Oracle is threatening an audit of those companies to determine if any of the contractual terms are violated by the purchaser. Companies have sprung up to assist the purchasers in questioning the findings of these audits. What makes software different from common household goods such as TV, automobiles, etc? What justifies differential pricing based on number of users? Other than the greed of software vendors.
The biggest difference between Products (TV, Automobile, Washing Machine) and software is that software is not sold. Software is licensed. You do not own it. You own the right to use it under the terms of the licensing agreement. If you do not agree with the terms of the license you are free to negotiate with the software owner or go find a different software solution with licensing terms that are more to your liking (like open source alternatives). The problem that software owners/vendors have is that software is easy to install and run on most computing equipment. Need an extra word processor for a new employee, just install the one you have on that employee's new PC. That is why most software installs try to phone home to the mother company to validate that the software license for it is not already bound to a different PC. Need more flexibility in the international nature of your multi country corporation. Then get an Enterprise License and you are free to use software as much as you want. Of course, you are going to pay an order of magnitude more for the license than a single user license. Have a small office with a tiny server and you don't want to pay for "big iron" prices. Then there are small server (per core) pricing. You can compare hard good products with software products only when they can "pop into existence" by simply installing a copy of them in another location. Need a 2nd TV, just install a copy of your TV in the new room, or friend's house. But I do agree that Oracle is the example of hardnosed licensing. It's the reason why almost everyone that is doing any serious development with Java software products is using OpenJDK development. If you are an enterprise and using Oracle as a database then you are stuck. You are already paying an arm and leg for licensing and support.
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Software is a product. Much like TV, automobile, washing machine, etc. The latter are tangible while software is intangible but that is not an important difference. Once upon a time, when you bought a software, you paid one price for it, no matter how many persons in the purchaser company used it. Then they decided to charge according to the power of the processor the purchaser company used. This is like saying you have a larger living room and so the TV is higher priced. Then they decided to charge price/user. This is akin to the price of the TV or washing machine being dependent on how many persons are in the household. Now, Oracle has gone one step further and its Java licenses are based on the number of employees in the purchaser company, including janitors or messenger boys they may employ. If a customer refuses to accept the new terms, which yield hundreds of thousands if not millions of dollars more in revenue to Oracle, Oracle is threatening an audit of those companies to determine if any of the contractual terms are violated by the purchaser. Companies have sprung up to assist the purchasers in questioning the findings of these audits. What makes software different from common household goods such as TV, automobiles, etc? What justifies differential pricing based on number of users? Other than the greed of software vendors.
A few decades ago, I would agree with you. But if you, we, us read the fine print, we don't own the s/w any more. It's not a tangible item, but wait, more to follow. What Oracle is doing is not new. They tried this crap 20 years ago and promptly got deleted from our system. I was in the office when my VP looked at the Oracle rep, looked at me, told me spin up mysql or postgres, up to you, looked back at the oracle rep, told him, you're fired, get the f'k out of the building. That said, Oracle or any company or YOU are entitled to demand whatever they want. You don't have to buy it. But you are dealing at the corporate level, so Oracle is counting on the fact that the pain of moving from their product is worse than paying their new charges. Broadcomm bought VMWare and it's a cluster fluck. Oracle is doing nothing wrong. Might piss you off, anger you, but their product is their product. Want to really get upset? Look t the cost of a bottle of Coke. It's $18/gallon. Don't even get me started on "bottled" water.
Charlie Gilley “They who can give up essential liberty to obtain a little temporary safety deserve neither liberty nor safety.” BF, 1759 Has never been more appropriate.
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Vivi Chellappa wrote:
What justifies differential pricing based on number of users?
I don't agree with differential pricing when it comes to greed. But, I think scaling pricing is great if it's done ethically. It gives smaller companies a chance to play ball. But, only if done ethically and not out of greed. Dunno about this situation in particular. I will say though that greed based pricing differences have been around for a while now. Hotels, Airlines, etc. will charge you more if you buy a ticket from an affluent area, for instance. So, the greed part is nothing new it's just being expressed through software now that the tech giants have fully embraced the dark side.
Jeremy Falcon
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Software is a product. Much like TV, automobile, washing machine, etc. The latter are tangible while software is intangible but that is not an important difference. Once upon a time, when you bought a software, you paid one price for it, no matter how many persons in the purchaser company used it. Then they decided to charge according to the power of the processor the purchaser company used. This is like saying you have a larger living room and so the TV is higher priced. Then they decided to charge price/user. This is akin to the price of the TV or washing machine being dependent on how many persons are in the household. Now, Oracle has gone one step further and its Java licenses are based on the number of employees in the purchaser company, including janitors or messenger boys they may employ. If a customer refuses to accept the new terms, which yield hundreds of thousands if not millions of dollars more in revenue to Oracle, Oracle is threatening an audit of those companies to determine if any of the contractual terms are violated by the purchaser. Companies have sprung up to assist the purchasers in questioning the findings of these audits. What makes software different from common household goods such as TV, automobiles, etc? What justifies differential pricing based on number of users? Other than the greed of software vendors.
Vivi Chellappa wrote:
What makes software different from common household goods such as TV, automobiles, etc?
Nothing, the rest of those industries just hasn't caught up yet. If you read about about The Great Reset, or whatever it's called, one of the key components is that nobody owns anything -- they rent stuff. :omg: "You'll own nothing and you'll be happy" - World Economic Forum, 2016.[^]
Latest Articles:
A Lightweight Thread Safe In-Memory Keyed Generic Cache Collection Service A Dynamic Where Implementation for Entity Framework -
Kschuler wrote:
when you bought software, you installed it and it never changed after that point.
Well in over 50 years in this industry I never worked on any software like that. The frequency of updates may not have been as often as now, but it still happened quite regularly.
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In the past (and even now), there was/is an annual maintenance contract with the software vendor that paid for upgrades and bug fixes. It is like buying an extended warranty for your car. My question remains: what justifies per-user pricing? PS. I brought in Oracle as an example of egregious business practices that is enabled by per-user pricing.
I don't agree with the per employee of your company bit...but per user of the software seems like a good way to account for the constant upkeep of the software. What else would be a fair way to do it? If I want to use some software for my small business of 4 people, I should have to pay the same as a huge corporation of thousands? Per user is at least proportional.
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Vivi Chellappa wrote:
What makes software different from common household goods such as TV, automobiles, etc?
Nothing, the rest of those industries just hasn't caught up yet. If you read about about The Great Reset, or whatever it's called, one of the key components is that nobody owns anything -- they rent stuff. :omg: "You'll own nothing and you'll be happy" - World Economic Forum, 2016.[^]
Latest Articles:
A Lightweight Thread Safe In-Memory Keyed Generic Cache Collection Service A Dynamic Where Implementation for Entity FrameworkMarc Clifton wrote:
"You'll own nothing and you'll be happy" - World Economic Forum, 2016.[^]
Much better stated as, "You'll own nothing and like it.
The difficult we do right away... ...the impossible takes slightly longer.
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Software is a product. Much like TV, automobile, washing machine, etc. The latter are tangible while software is intangible but that is not an important difference. Once upon a time, when you bought a software, you paid one price for it, no matter how many persons in the purchaser company used it. Then they decided to charge according to the power of the processor the purchaser company used. This is like saying you have a larger living room and so the TV is higher priced. Then they decided to charge price/user. This is akin to the price of the TV or washing machine being dependent on how many persons are in the household. Now, Oracle has gone one step further and its Java licenses are based on the number of employees in the purchaser company, including janitors or messenger boys they may employ. If a customer refuses to accept the new terms, which yield hundreds of thousands if not millions of dollars more in revenue to Oracle, Oracle is threatening an audit of those companies to determine if any of the contractual terms are violated by the purchaser. Companies have sprung up to assist the purchasers in questioning the findings of these audits. What makes software different from common household goods such as TV, automobiles, etc? What justifies differential pricing based on number of users? Other than the greed of software vendors.
Vivi Chellappa wrote:
Once upon a time, when you bought a software, you paid one price for it, no matter how many persons in the purchaser company used it.
I don't agree with that premise, but let's keep going to see where that sort of thinking leads...
Vivi Chellappa wrote:
What justifies differential pricing based on number of users?
Scale. You sell one license for your software to Company A that is going to have 3 of its employees use your software. Then you sell one license for your software to Company B that is going to have 1000 of its employees use your software. Company B should pay the same price as Company A? The only thing that's fair in that market is for you (as a software vendor) to have a single opportunity to sell one license (one per company), because every company in the world can get away with purchasing a single license? Consider also that Company B will use so much more of your support than Company A that it'll completely eat whatever profit you made on the sale, and soon having that company as a customer will cost you money. Unless you charge a fortune for each license, which means you'll never have any opportunity to sell to Company A to start with. The TV/automobile analogy severely falls apart because when you sell those, you charge for every TV/automobile you sell. The customer has a need for more of his people to use a car? Sell him more cars. I'm never going to defend Oracle for its licensing practices, but that's because they deviate from the sort of common sense (I hope) I've described above.
