Q. Looking at the open-source world, there's this movement away from selling licenses toward selling support. A lot of people are participating in that, and you have been skeptical. Why? Do you think that's fundamentally the wrong model?
Gates: The industry will always be a mix of free and commercial software. So there will be a balance between those. I think that we are going to have a lot of both. There are some zealots that think there should be no software jobs, that we should all, like, cut hair during the day and write code at night.
Should you take some of those extreme views, I think it's easy to say that's not right. There are things like compatibility and 24-hour support and taking big leaps like IPTV or speech recognition. The painstaking work over a decade that you have to do that costs hundreds of millions or even billions of dollars. That's the commercial side. It's good at hiring people and selling licenses and taking the risks that go with that.
I've always believed in low-cost, high-volume. It should be a cost that's so obvious that you should spend, because it saves you on personnel time, hardware, communications costs, which are gigantic when compared to the price of packaged software. That cost is almost a rounding error. The value you get out of the system is a lot larger than that. I don't just believe in a single model. There's a lot of neat things that can be done. But I don't think that someone who completely gives up license fees is ever going to have a substantial R&D budget and do the hard things, the things too hard to do in a university environment. But that's OK. There will be a commercial software industry, hopefully, with companies that take the long-term approach and make the investments that drive those new breakthroughs.
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