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From: mart@csri.toronto.edu (Mart Molle)
Newsgroups: comp.sys.mac
Subject: Re: Software piracy
Message-ID: <1990Jun14.130245.22777@jarvis.csri.toronto.edu>
Date: 14 Jun 90 17:02:45 GMT
References: <3914@moondance.cs.uq.oz.au> <56447.2673B586@cmhgate.FIDONET.ORG> <9243@paperboy.OSF.ORG> <41882@apple.Apple.COM> <36990@ucbvax.BERKELEY.EDU> <11064@claris.com>
Organization: CSRI, University of Toronto
Lines: 70

Brendan McCarthy (brendan@claris.com), responding to earlier comments, writes:

[on people finding it easy to rationalize piracy:]

>I think part of the problem is that people confuse the media (disks, manuals,
>etc.) with the software itself.  When you pay for software, you are not 
>primarily paying for the cost of material goods, but rather for the development
>effort of the software.  Somehow, people seem to equate the ease of duplicat-
			  ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
>ing these material goods with the difficulty of creating quality software.
^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
[on music piracy as "good advertising", and its analogy with software piracy:]

>Maybe so, but the software industry and the music industry are very different.
>For example, the ONLY way a software company generates income is by selling
>software... there are no concerts to subsidize them.  
>
>As a software engineer, the software piracy harms me directly.  A quality
>piece of software is the result of tens of thousands of man-hours of labor,
>by several dozen people over a long period of time.  It costs tens to hundreds
						      ^^^^^^^^^^^^^^^^^^^^^^^^^
>of thousands of dollars just to develop the software.  This does not include
 ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
>production cost, the cost of writing manuals, marketing expenses, etc.
>It's important for customers to realize this.

An issue that has not come up yet in this discussion is people's [lack of]
understanding of value-for-money EVEN WHEN THEY DO UNDERSTAND that they are
paying for software development and not just production costs.  I know
of people with some programming experience whose attitude is essentially:

	``I could have written a program in X days on my machine having
	Y percent of the functionality of this package, so a price of Z
	is a ripoff to gouge the suits who don't know any better.''

Obviously, the above rationalization is flawed because it ignores the fact
that writing the first kludgy prototype is only a small step along the way
to a saleable product.  However, let's see what the response by a
hypothetical `man on the street' might be to the highlighted text:

	``OK, so Ford spent 5 *billion* dollars to develop the Taurus/Sable,
	and is now selling copies at about $15K each.  Thus, a back of the
	envelope calculation for determining the "fair" price for a piece
	of software that cost .5 million to develop comes out to around $1.50.
	That's not enough to cover the production costs, but I guess it means
	the price of software should be set at little more than production
	costs.  So why do they charge hundreds of times more???''

Well, at the present time, software is different from automobiles, hit songs,
and just about everything else the hypothetical man on the street is familiar
with.  They must charge a lot more because they can't expect to sell millions
of copies without a lot of additional work in updating the product.  There
aren't that many potential customers for a given piece of software (yet),
because there isn't a long term universal standard for the interface to the
hardware platform.  Imagine if cars ran on rails instead of pavement, and
every year they added some new segments of track with yet another incompatible
guage (spacing).  Or imagine if the musician who enjoys his "good advertising"
had to do a new arrangement (and re-record) his hit song every time Sony came
up with a new cassette deck or CD player.  I dare say that automobile makers
and musicians would be forced to alter their price structure in the direction
of software houses.  I guess the bottom line is that we should not expect
commodity prices on software until we stop innovating on the hardware side,
and run out of good ideas for evolving the software.  I'm sure not looking
forward to this...

Mart L. Molle
Computer Systems Research Institute
University of Toronto
Toronto, Canada M5S 1A4.
(416)978-4928