Ted Leung on the air
Ted Leung on the air: Open Source, Java, Python, and ...
Thu, 10 Jul 2003
OSCON: Robert Lefkowitz "Protecting the Innovation Premium"
This was by far the best talk of the day.

He pointed out that today we all believe in the notion of an innovation premium, that is, if we've invested resources in the creation of something, we are entitled to get something (not necessarily money) in return. This idea started in the 1400's with the advent of compilations of works. Lefkowitz notes that even GNU people believe in the innovation premium because they insist that you call their system GNU. They value being credited as the means of return.

Along the way he stopped in Ecclesiates 2:18-21

18 Yea, I hated all my labour which I had taken under the sun: because I should leave it unto the man that shall be after me.
19 And who knoweth whether he shall be a wise man or a fool? yet shall he have rule over all my labour wherein I have laboured, and wherein I have shewed myself wise under the sun. This is also vanity.
20 Therefore I went about to cause my heart to despair of all the labour which I took under the sun.
21 For there is a man whose labour is in wisdom, and in knowledge, and in equity; yet to a man that hath not laboured therein shall he leave it for his portion. This also is vanity and a great evil.

He pointed out that v.21 is about venture capitalists. He also reminded us that the context of the passage is "we're all gonna die and we can't take it with us"

There was a detour for 3 technical definitions for freedom, if you want this, e-mail and I'll post, but I'm behind in blogging my notes.

He then flew through some business models:

  • Creating accounting / Sharia-compliant mortgages.
    If you are trying to sell something that you are not allowed to sell, pretend that it is something you are allowed to sell. In Islam, it is forbidden to lend money and collect interest. But under Sharia law, there are ways to buy a house that involve interest-free mortgages and various kinds of fees. Turns out that interest-free with fees == interest at some rate. This is a way of satisfying a religious aversion to interest. The relation to open source: software is free, so you can't sell it. But you can sell "subscriptions". He put up the 10-Q's for Borland and RedHat and showed how the numbers tell us that license revenue and subscription revenue, respectively, are the same when related appropriately.

  • Turn "open" software into proprietary software

  • Liability Insurance / Warranty
    If you believe that your software is less defective than your competitors, ask the goverment to require warranties and then initiate product liabilty lawsuits when they fail.
  • Recycling
    Legislate no end of life for software - eventually companies will get tired and open source the old versions. You can charge to maintain the older versions

  • Craft Guilds
    Lefkowitz tells story about his broken refrigerator. He opens it up and there's a wiring diagram inside. Being an EE by education, he can fix that. The fine print says "for license repair personnel only" The wiring diagram is open source. So require licensing / certification of programmers and stil charge for the software.
    Lefkowitz wants a new GPL that says "you can change, modify, distribute, etc if and only if you are a licensed programer".

  • Manufacturing Process
    Buy an open source web server via IBM or Oracle

  • Education / Patronage
    The sophists did some teaching in public, but witheld information to be taught only in secret and for a fee. This is JBoss.

As he wound up, he pointed out that our legal system and economic system make it hard for people to share stuff. We have no equivalent of the Joint Stock Limited Liability Company for Software (The JSLLC changed the rules for creating companies -- prior to it, you could only have a company if you had a patent, and the company had to do what the patent said. After JSLLC you could form a company to do what you want.)

[01:16] | [computers/open_source] | # | TB | F | G | 1 Comments | Other blogs commenting on this post
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I work at the Open Source Applications Foundation (OSAF).
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