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Open Source-onomics: Examining some pseudo-economic arguments about Open Source

We may have shown that Open Source is viable and will most likely continue to survive, maybe even thrive. But isn't it too much to suggest that proprietary, commercial software will go the way of the dodo? Is this really a commodity market? Aren't most leading commercial software products ahead of their Open Source equivalents, anyway? How can Open Source hope to beat commercial software in features? For example, can the Open Source database package PostgreSQL ever hope to match Oracle? Customers won't use inferior products just because they're free! They'd prefer to pay for better products.

This situation is similar to the story of the two men who come upon a tiger in the jungle. One of them starts putting on his running shoes. "Are you crazy?" whispers the other, "You can't hope to outrun a tiger!" "I don't have to outrun the tiger," explains the first, "I only have to outrun you!"

Open Source products don't have to become better than their commercial equivalents. They just have to become good enough to meet user requirements. Why would users pay for features they don't need? Do you really need a Web server inside your database? A Java Virtual Machine, perhaps? Or a whole host of features you're never going to use? No? Then why pay for Oracle 9i? PostgreSQL lets you create tables, fill them with data, fire SQL queries at them, and gives you reasonable performance. Isn't that good enough for you, and for 90 percent of the market? So PostgreSQL didn't have to outrun the tiger, did it?

Notice that this is an economic argument. It is not a technological argument along the lines of "Open Source products evolve faster and fix bugs quicker, so they'll get better than their commercial rivals one day". Actually, we couldn't care less. At a certain point in time, commercial vendors may be reduced to selling differentiated features that 90 percent of the market doesn't need, while the most commonly-required features will be available to all, free of charge. Those common features will conform to standards, while proprietary, differentiating features will remain exactly that, -- proprietary and non-standard.

It is such commoditization of the market that could slaughter proprietary commercial software, driving it into niches and ensuring that the mainstream goes Open Source.

"Customers will never trust something that is free"

All of this sounds pretty convincing in theory, but Open Source should have been growing like gangbusters if all of this is true. But we see very gradual adoption of Open Source in the market. Is it perhaps because people will never respect and trust something that is free...?