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Saturday, March 1, 2008

Open Source Economics vs Real Economics

What would be the cost of PC-based hardware today, if IBM had not opened its proprietary hardware to the public? Well, let’s assume that any PC would cost at least as much as a Mac, and enterprising companies like Dell or Compaq would not exist today, as we know it.

There would be much less computers around in the world today, because of higher prices, and the Clinton administration would not have
scored high in economic growth. Bill Clinton back then, during his first tenure, asked Bill Gates how to run an economy with computers alone. Clinton had an answer during his second term, as computer cut costs in production, becoming the main drive of the American economy.

France in the 1980’s had a computer network similar to the Internet. But it failed
, because it was too expensive to implement, and it was not an open architecture. We all know that the open architecture of the Internet TCP/IP protocols enabled the web to grow exponentially in less than 15 years.

Open source standards are what have enabled us to jump into the Information Age. The expansion of the Internet and its wide spread application in society would be crawling now, if it all were based on proprietary technology.

Brief and to the Point:

In this case, the Open Source nature of standards allowed more economic participation, from small players to big ones, as the entry ticket price to the competition was substantially lowered. And who gets the benefits when we have avoided proprietary monopoly? Everyone!!


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