OSS:Software Commodification
Members
Kianwin Ong okwin@ucsd.edu User:Kianwin
Introduction
In Some Implications of Software Commodification , Dave Stutz writes:
The word commodity is used today to represent fodder for industrial processes: things or substances that are found to be valuable as basic building blocks for many different purposes. Because of their very general value, they are typically used in large quantities and in many different ways. Commodities are always sourced by more than one producer, and consumers may substitute one producer's product for another's with impunity.
Commodification is hardly specific to the software industry. Over time, ubiquity drives products to converge onto uniform quality standards, and "even software that starts out proprietary eventually becomes standardized and ultimately commodified". The open source movement, however, has greatly accelerated the pace at which software commodification is taking place. In fact, where the open source movement has been portrayed as "eroding market value" and "destroying intellectual property" by commercial software vendors, it is actually the threat of commodification that the companies are trying to circumvent.
Contrast between 1998 and 2004. Back then, Netscape gave away their web browsers in the hope of selling more of their enterprise web server software. Even if Microsoft had not won the Browser Wars, Netscape would have found its business model threatened by the commodification of web servers. Today, the open source Apache commands over 60% of the market share. Microsoft, as the closest competitor, bundles IIS with their server operating systems instead of selling it separately.
In that same vein, several other high profile open-source projects come to mind: GNU/Linux platforms in response to expensive, proprietary UNIX systems; Sendmail, Exim and Postfix as free alternatives to Microsoft Exchange; "the cloning of Microsoft's Windows and Office franchises" by projects ranging from KDE, Gnome, WINE and StarOffice; and more recently Mono as an open-source .NET implementation.
Project Goals
In class, we have already discussed how negligible marginal costs and immense network externalities have shaped innovation and industry in Information Technology. We aim to investigate software commodification, as brought on specifically by the open-source movement, to see how it resonates with, or perhaps counteracts against the other factors. In doing so, we hope to further develop the existing economic arguments for and against open source.
References
Online
- The Open Source Paradigm Shift - Tim O'reilly
- Some Implications of Software Commodification - Dave Stutz
Books
- Information Rules - Carl Shapiro, Hal R. Varian
