[A2k] IP Watch: The Development Agenda of Free Software

[Karsten Gerloff]

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Dear all,

just in time for the WIPO Development Agenda negotiations next
week, IP Watch has an in-depth article on the economic impact of
free software and its effect on development, written by
UNU-MERIT=E2=80=99s Rishab Ghosh and Karsten Gerloff.  Drawing on the
recently published FLOSSIMPACT report, it argues that free
software enables a more effective kind of technology transfer: By
providing an informal training environment, it lets people
everywhere develop valuable IT skills.

As money is spent on services instead of licence fees, free
software allows most of the value added to be retained locally,
instead of being transferred to large corporations in the global
North.

Policies that level the playing field for free software will by no
means lead to the breakdown  of the software market:

=09"In the software market, by far the most money is made in
=09services and the development of tailor-made software. In the
=09EU and in the US, under one fifth of software investment is in
=09(proprietary) packaged software; the rest is in custom
=09software and in-house software.

=09In terms of jobs, firms selling proprietary packaged software
=09account for well below 10 percent of employment of software
=09developers in the US. Custom software developers and service
=09providers account for about a third. But the majority of
=09programmers work for =E2=80=9Cuser=E2=80=9D organizations such as banks,=
 the
=09retail and manufacturing sectors and government.

=09The common argument against the use of free software in
=09development - =E2=80=9Cwhat=E2=80=99s the economics if you can=E2=80=99t=
 sell software
=09you make=E2=80=9D - is demonstrated to be false even for the US, with
=09the largest information technology (and proprietary software)
=09industry. As the software jobs and investment figures show, a
=09small minority make money selling software. Most organizations
=09- and a vast majority of programmers - make money selling
=09their time spent writing or supporting software, but not
=09selling the software itself. This is in fact the economic
=09model of free software: sell potentially everything other than
=09the software itself. The report shows that it is the
=09proprietary software industry that is an anomaly in today=E2=80=99s
=09software market, with which the economics of free software is
=09more in tune."

You can find the article here:
http://www.ip-watch.org/weblog/index.php?p=3D532&res=3D1280_ff&print=3D0

and the full FLOSSIMPACT report here:
http://flossimpact.eu/

best,
Karsten

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UNU-MERIT =09=09   =09 <http://www.merit.unu.edu>
Researcher=09=09Free Software & Access to Knowledge
Tel. +31 (0)43 38 84479=09 //  Keizer Karelplein 19
6211 TC Maastricht      //   The Netherlands
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