Biju Chacko wrote [at 10:24 AM 9/19/2007] :
FOSS doesn't deserve to become ubiquitous if the only way it can do so
is by reservations (affirmative action in US lingo).
I am not sure if I agree. The reason? Metcalfe's Law, which means
that the switching cost from a ubiquitous platform to a
non-ubiquitous one can be prohibitive, absent the kind of 'nudge'
that such a reservation would provide.
See, for example,
http://www.nuff.ox.ac.uk/users/klemperer/Farrell_KlempererWP.pdf
from the abstract:
Switching costs and network effects bind customers to vendors if products
are incompatible, locking customers or even markets in to early choices.
Lock-in hinders customers from changing suppliers in response to (predictable
or unpredictable) changes in efficiency, and gives vendors lucrative ex post
market power|over the same buyer in the case of switching costs (or brand
loyalty), or over others with network effects.
Firms compete ex ante for this ex post power, using penetration pricing,
introductory offers, and price wars. Such "competition for the market"
or "life-cycle competition" can adequately replace ordinary
compatible competition,
and can even be fiercer than compatible competition by weakening
differentiation. More often, however, incompatible competition not only
involves direct efficiency losses but also softens competition and magnifies
incumbency advantages. With network effects, established firms have little
incentive to offer better deals when buyers' and complementors' expectations
hinge on non-efficiency factors (especially history such as past
market shares),
and although competition between incompatible networks is initially unstable
and sensitive to competitive offers and random events, it later "tips"
to monopoly, after which entry is hard, often even too hard given
incompatibility.
And while switching costs can encourage small-scale entry, they
discourage sellers from raiding one another's existing customers, and so also
discourage more aggressive entry.
Because of these competitive effects, even inefficient incompatible
competition
is often more profitable than compatible competition, especially for
dominant firms with installed-base or expectational advantages. Thus firms
probably seek incompatibility too often. We therefore favor thoughtfully
pro-compatibility public policy.
--
((Udhay Shankar N)) ((udhay @ pobox.com)) ((www.digeratus.com))
