<<While much has been said in this thread about the pricing strategies
benefits and drawbacks, one fundamental policy has not been questioned:
Why is software licensed rather than sold?>>

Maybe to be consistent with other types of intellectual property?

<<I'll avoid cruel suggestion that it is done wholly and solely to make
the suppliers more money.

The obvious answer is that software is licensed rather than sold to
prevent copying.  Yet licensing doesn't actually *prevent* copying.  It
merely provides for penalties if it is discovered by the licensor.  While
not being a lawyer, I believe that these same or similar penalties would
still apply
even to a sold software.

A similar case has been tested here in Australia where hardware has been
protected from copying: a few years ago Ford registered its design for
Falcon tail-lights and successfully prevented other suppliers from
copying the design, or importing copies - thus preventing any
competition!>>

Such registration doesn't really protect the "hardware"; it prevents
others from unauthorized copying of the expression as embodied in the
"design". Like a piece of music, an architectural drawing-or software.

<<Consider that anyone with a photocopier can make copies of any book,
but my local book seller doesn't trouble me with incomprehensible license
agreements when I line up with the latest stack of "Goosebump" books for
my kids.>>

This analogy might not work that well, if you consider that your
"purchase" of the "book" gives you no rights whatsoever to the
information contained in the book; you're paying the publisher for
production, advertising, transportation, etc., and the author (via the
publisher) his license fee, but you do not thereby establish "ownership"
of the writing; all you "own" is the physical pages that carry that
individual copy of the writing. This is quite a bit different from buying
a bicycle or a package of Gummi Bears, where you obtain complete
ownership and control of the item, and can do whatever you choose with it
(subject to legal sanctions on some uses, of course).

At lease we aren't (yet!) to the point where software is controlled like
music: you get a license to "use" it for a specified number of
performances, or for a set period of time, and then you have to
re-negotiate the license.

Also, the effective cost (time, dollars) of copying most books approaches
or exceeds the cost of obtaining a legitimate copy of the item; this is
not the case for most software.

<<Another more valid argument for licensing may be given that licensing
prevents on-selling of old product.  If I received a trade-in for my old
car when buying a new, then found the dealer didn't (or wouldn't) collect
the old car, I could be sorely tempted to sell the old car elsewhere.
 The illegality of this action though is still clearly evident.

That licensing though *does* inhibit a second-hand market for software is
clear, but I'm not yet certain whether this is good or bad.>>

Well, it's certainly "good" for the software publisher ;-). Which leads
directly back to your "cruel suggestion" above.

<<As it is, once the license fee for software is made, there is no value
left to the purchaser.  Where I buy a new piece of equipment for my
factory, the capital value is preserved: I've exchanged cash for equal
value in equipment. But for software, the money is gone and there is no
value showing up for the company.  It is simply an expense.

...

As to whether intellectual property rights are better protected by
license, I think we can see that Music CDs and VideoTapes are as
reasonably well protected as software without complex agreements
restricting what machines they may be run on or how many people are
listening (providing it is not in a commercial environment however).

...

But I think it is interesting we as a community so readily accept
'licensing' for software when we wouldn't for other things.>>

I wonder how much of the current licensing approach is a hold-over from
the "big-iron" mainframe days when you owned neither the hardware nor the
software-you rented the hardware from IBM, and licensed the software.
Hardware made the transition to a transferable item that was sold to the
customer, but the software stayed in the owned-by-the-company,
licensed-to-the-user paradigm. Plus, in the "old days" (i.e., when I was
in high school) you didn't generally just license the software; you
bought into a complete package of maintenance updates, support, maybe
installation, etc. In this framework, it's easy to think of software as a
component of a service that you're receiving, not as a concrete item with
individual value that you purchase. Maybe that mindset carried over a
little too strongly?

And, of course, there's the "you rate what you get away with" factor: if
the buying public allows software publishers to get away with outrageous
licensing agreements that would not be tolerated in other areas, the
publishers are going to do it. If the public votes against such practices
with their wallets and pocketbooks, the practices will stop.

Steve Dirickson         WestWin Consulting
(360) 598-6111  [log in to unmask]