ACT's Latest Report? Pay No Attention

The Association for Competitive Technology (ACT) sounds a worthy sort of outfit:

ACT is an international grassroots advocacy and education organization representing more than 3000 small and mid-size information technology firms from around the world. ACT is the only organization focused on the needs of small business innovators from around the world. We advocate for an environment that inspires and rewards innovation.

Ah, but hang on, there seems to be a weasel word in there: “innovation” is one of Microsoft's favourite coded ways of saying “let us do whatever we want, even if its monopolistic and illegal, because we're pushing the boundaries, and everyone knows that's good” (well, yes, and I suppose Cosa Nostra was pretty innovative in its methods, too).

Indeed, ACT starts to tip its hand thereafter:

We also provide resources like the Innovators Network to help our members leverage their intellectual assets to raise capital, create jobs, and continue innovating.

Gosh, so much innovation for those innovating innovators – but to what end? Well, “leveraging their intellectual assets”, of course – that is software patents. But wait a minute, surely ACT is just protecting the little guy from all those nasty big software companies that want to steal ideas? Well, not exactly:

In addition to its small business membership, ACT has several Sponsor Members including eBay, Microsoft, Oracle, Orbitz and VeriSign.

There you have it: that well-known friend of teensy-weensy companies everywhere, Microsoft, is a “sponsor” of ACT. That would probably explain the fact that ACT's position, notably in Europe, has been resolutely pro-Microsoft, and anti everything that is anti-Microsoft.

So it comes as no surprise that ACT's latest report is entitled “Paying for Free”; now, who could that be directed at, I wonder? Here's the executive summary to give you a clue:

Free software and services can be part of a larger enterprise geared toward expanding market penetration and increasing revenues. Consequently, “free” does not mean that software is without cost. Normal cost/benefit analysis still applies to software that is open source or ad-based, because license fees represent only a small portion of ownership costs. By now, most IT decision-makers are aware that while there may not be licensing fees paid at the time of purchase or acquisition, all software has costs.

As a way to better ascertain costs, software buyers have traditionally analyzed their systems using a total cost of ownership (TCO) methodology. This analysis evaluates the lifecycle costs of IT systems, and factors in initial acquisition and ongoing cost considerations. Upfront acquisition costs include not just license fees, but also integration and training costs. Ongoing costs include maintenance, support and updates—the sort of costs associated with any kind of IT system.

Yet, traditional total cost of ownership analysis is incomplete for considering the unique costs and benefits of free software and services, particularly if delivered through the Internet. Privacy, security, and sustainability rank as three main concerns for ad-based software. These are non-monetary costs and perhaps harder to quantify, but from a buyer or consumer perspective, they are still very real.

A decision-making process that incorporates privacy, security and sustainability considerations will result in a truer assessment—by procurement officers and policymakers—of the cost of software alternatives. Understanding the costs as well as benefits of free software will avoid creating the expectation that there is such a thing as a “free lunch” in IT—a benchmark that no IT business model can meet.

Well, yes, but this is *so* 20th century: we went through all the FUD about TCO years ago. Nobody over the age of five is claiming that free software is without normal running costs, so why resurrect this now?

What's surprising about this latest ACT tract is that it's mostly unexceptionable: it's simply rehashing stuff from years ago. What's most interesting is what's *not* mentioned: the fact that traditional closed-source solutions have an *exit* cost, because you're typically locked into them. Open source nearly always uses open standards and open formats, so that's far less of a problem.

Indeed, this exposes the central flaw in the ACT report: it wilfully misunderstands what “free” really refers to in free software: it's “free as in freedom” that matters, not “free as in beer”. What free software gives uses is the freedom to do things their way, to bring in third-party contractors, to pay for only what they want and need, and – ultimately – to move to a different solution.

“Paying for free” is not so much wrong – it's analysis of the cost side of free software is reasonable enough - it's just beside the point, and simply not worth, er, paying attention to.

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Copyright © 2009 IDG Communications, Inc.

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