Incentives: Neither Left nor Right but Center Copyright, 2001 © Marshall W. Van Alstyne School of Information.

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Incentives: Neither Left nor Right but Center Copyright, 2001 © Marshall W. Van Alstyne School of Information

Incentives to develop software Source: Software & Information Industry Association

Competition from OSS is Valuable Open Mozilla model easy for 3 rd party dvprs to upgrade Innovation in IE stopped with IE 4 “Auto-image resizing: It’s a feature not a bug, really.” Source: Salon 9/ “Mozilla Rising” Farhad Manjoo

What do we protect? Look & Feel  CopyrightFunction  Patent

OSS Classification Source: Vinod Valloppillil / The Halloween Document

Most licenses are corner solutions Let  [0,1] be the measure of openness. Let t  [0,1] be the time to release derivative works.  t GPL BSD Proprietary Copyflex

Price Quantity Price Quantity Market One (Acrobat Reader) Market Two (Acrobat Distiller) Initially, there are profits to be made in both markets. q1q1 q2q2 p1p1 p2p2 Consider profits in two markets

Price Market One (Acrobat Reader) Market Two (Acrobat Distiller) Initially, there are profits to be made in both markets. But subsidizing market one with a free good can increase demand and profits in market two more than the loss in market one. Quantity q1q1 q2q2 p1p1 p2p2 Consider profits in two markets