Why open source is bad for Australia

Conclusions
Australia is a well educated, capable and creative nation. To compete in the world economy we need strong copyright protections so our smaller firms can protect their innovation against the larger marketing and distribution engines of multinationals. Accordingly, the IP provisions of the FTA do no harm to us, and will be in our interests.

References

  • ABS, 2003, Balance of Payments and International Investment Position, December 2003, Cat. no. 5302.0, cited in Richardson D, 2004, Intellectual property rights and the Australia-US Free Trade Agreement, Research Paper No 14 2004-04, Information and Research Services, Australian Parliamentary Library

  • Adobe, 2004, Statement on the Sklyarov case

  • Akerlof GA et al, 2002, The Copyright Term Extension Act of 1998: An Economic Analysis, as Amici Curiae in support of Petitioners in Eldred v Ashcroft No 01-618

  • Bessen J & Hunt R, 2004a, An Empirical Look at Software Patents, Federal Reserve Bank of Philadelphia Working Paper 03-17R, March 2004

  • Bessen J & Hunt R, 2004b, A Reply to Hahn and Wallsten, 10 Mar 2004

  • Broersma M, 2004, Flaw in main Linux Kernel flaw makes Linux crash easy, CNet, 16 June 2004

  • Copyright Agency, 2004, Submission to Senate Select Committee on the FTA

  • Ergas H, 2002, Review of intellectual property legislation under the Competition Principles Agreement, Intellectual Property and Competition Review Committee (The Ergas Report)

  • Google, 2003, Google Zeitgeist - Search patterns, trends, and surprises according to Google, Sept. 2003

  • Hahn R & Wallsten S, 2003, A Review of Bessen and Hunt's Analysis of Software Patents, AEI-Brookings Joint Center, mimeo

  • Hahn R, 2002, Government Policy toward Open Source Software: An Overview in Robert Hahn, ed, Government Policy toward Open Source Software, AEI Brookings Joint Centre for Regulatory Studies, Washington DC

  • Hall BH & Ziedonis RH, 2001, The patent paradox revisited: an empirical study of patenting in the US semiconductor industry, 1979-1995, RAND Journal of Economics, Vol. 32, No. 1, Spring 2001

  • Hansard, 2004a, Senate, Select Committee on the Free Trade Agreement between Australia and the United States of America, 17 May 2004

  • Hansard, 2004b, Joint Standing Committee on Treaties, 20 April 2004

  • Healy T, 2004, Has open source reached its limits? Institute for Policy Innovation, Dallas

  • Liebowitz S & Margolis S, 2004, Seventeen Famous Economists Weigh in on Copyright: The Role of Theory, Empirics and Network Effects, AEI-Brookings Joint Centre for Regulatory Studies

  • Lyons D, 2004, Free Software? Not For You, Baby, Forbes Magazine, 15 June 2004

  • Manes S, 2004, The Trouble With Larry, Forbes Magazine, 29 March 2004

  • Mann RJ, 2004, The Myth of the Software Patent Thicket: An Empirical Investigation of the Relationship Between Intellectual Property and Innovation in Software Firms, The University of Texas School of Law, Feb 2004

  • OECD, 2004, OECD 2004/01 Report on Patents and Economic Performance, Feb 2004

    Editor's note: The PDF version of this document can be found here.

    Tony Healy is a software developer and policy researcher based in Sydney, Australia.

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    Talkback 6 comments

      "Open Source is bad for A ...Anonymous -- 26/06/04

      "Open Source is bad for Australia" is such a blanket statement that I would have to disagree.

      The author makes valid points about GPL on occasions hindering, rather than enhancing business, but GPL is not the only Open Source model. GPL is often used with the attitude "I am not making any money out of publishing this code, so why should anyone else." Unfortunately, R&D investment can not be warranted "commercially" on a GPL system, because the entity spending the money does not get any benefit (except knowing they might make the world a better place).

      There are also instances where Open Source would be detrimental to commercial interests in Australia. But Open Source often brings benefits, which is why I disagree. One of the problems with proprietary source code is that if the particular vendor goes bankrupt, or a relationship sours with a vendor, your data is effectively held hostage (Most of the time, you can not simply port to another vendor's package). Whilst open source doesn't guarentee flexibility (there may be binding contracts even in open source), in my view you are certainly more secure.

      Secondly, many open source products are free. This is not co-incidental, but a consequence of GPL and alike. In fact, this is one of the factors hinted at in the article. I would like to suggest that Open Source classes, databases, languages, APIs and alike can significantly reduce development time. Most open source products have public documentation, so they don't need to be re-documented. Furthermore, not having to pay license fees can assist a software company to be more profitable.

      Thirdly, on following on from point two, cheaper development costs inevitably lead to more competitive markets and cheaper prices to the end user. This makes software more accessable to Australians.

      That's true. The title is mean ...Anonymous -- 28/06/04

      That's true. The title is meant as a newsy summary for the article on ZDNet, rather than a precise statement of my position.

      My point is not there's anything wrong with public software or with academics and scientists sharing source code. That's normal.

      My concern is specifically with the activism of open source lobbyists who are seeking government assistance for a mode of business essentially concerned with exploiting software developers.

      Thank you for clarifying the t ...Anonymous -- 28/06/04

      Thank you for clarifying the title being purely sensationalism. I share your concern with lobbyist trying to force governments to legislate that Open Source be selected where possible. Equally though it concerns me when Open Source isn't even considered as a possibility. I wish they would legislate that common sense be used. I don't expect every government department to be running OpenOffice and Mozilla on Fedora or Mandrake, but if you are going to choose to run Office on Windows XP, then you need to justify the extra $800 per license (OEM pricing, might be cheaper with government licensing).

      As far as Open Source exploiting software developers (presumably by preventing them from profiting from their development, or bypassing their income stream), I am a software developer who creates commercial software. If someone makes an Open Source version of what I am doing, I lose my competitive edge, that is reality. I therefore focus on making my software better (features / stability / compatibility / support) than the Open Source competitor. I would point out that it cuts both ways. If I wanted to harm a competitor in the marketplace, I could release some open source version of my software that would undercut these competitors, and lock people on an upgrade path with my software (I wouldnt on principle, but companies have in the past).

      IMAO, that is what Borland could have been trying to achieve when they published Interbase 6 as Open Source then 7 as closed source again.

      I wouldn't see it as exploiting developers as much as I see it as allowing developers to learn from each other. Some open source licensing models are better than others at keeping the spirit of this, but companies should have to add value to their products to keep clients, not rely on the fact that some operations manager chose their product 4 years ago and now all the companies data for the past 4 years is locked in.

      You say you're concerned with ...Anonymous -- 28/06/04

      You say you're concerned with developers being "exploited". Let's take a look at that word's definition:

      http://dictionary.reference.com/search?q=exploit

      Definition 1 is "To employ to the greatest possible advantage". Hmm. Well that sounds pretty good to me! Why wouldn't you want to do that?

      Definition 2, which I assume is the one you're referring to, is "To make use of selfishly or unethically". Well that sounds bad, doesn't it?

      So how is it "selfish" or "unethical" to support developers contributing things free to the software community? It's fairly obvious that actions for profit are far more "selfish". If you're concerned about the selfish exploitation of software developers, then you're going to need to change your view to an anti-commercial software one.

      The comments here do not refle ...Anonymous -- 30/06/04

      The comments here do not reflect the extent of negative comment about this article. Take a look at the feedback on builderau.

      http://www.builderau.com.au/program/work/talkback.htm?PROCESS=show&ID=20050722&AT=39129645-39024650t-20000982c

      You are obviously blind to the ...Anonymous -- 02/07/04

      You are obviously blind to the occurrences in society as a whole today. Your so-called intellectual copyrights protection against international theft aren't protected completely anyway because many Governments do not accept our copyright & re-sell under another label will occur anyway. Also, unless you are there to sue the offender it isn't going to stop them.

      With hardware today, as soon as some novel artifact comes into being it is copied & reproduced at a cheaper cost. That is the lay of the land & you have no control over it.

      Get a life & live in the real world. Your ideas are heaven sent & will stay there for ever. It isn't happening in the "real" world.

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