Something hit me the other day. Perhaps it was two years of education at the hands of Larry Lessig finally sinking in. Or perhaps it was my reading of Gene Simmons' commentary on those pesky kids who steal his music. Whatever the impetus, it finally all came together.
Twentieth century software business models focus on scarcity because they're founded upon 20th century conceptions of property (actually, their origin is a few centuries' older than that, but never mind).
Scarcity is the absolute wrong way to build a software business in the 21st century, with the rise of digitization. It is pointless and fruitless to insist that the digital world act like the physical or analog world, and build business models that conform to this false view. To thrive in the new software world, we need to embrace its changes rather than fight them.
Inspired by Glyn Moody, I wrote a few weeks ago that "in a digital world, the money is in analog." But the principle is actually much deeper than this.
To get at the principle, it's useful to look at the successful business models of a few 21st century pioneers, including Google and Red Hat:… Read more