The True Price of Software

[2005-07-24 20:50:37]

O'Really OnLAMP as an interesting article on the true price of software. Basically, the author state that a significant portion of the value of software is the embedded "derivatives"--options or warrants--on future maintenance and enhancement. The calculation is right and yes, that can be a way to calculate the true value of software. However, the problem is the initial price: the sell price of any product is never related to it's actual cost. It's the higher price some marketter think you are ready to pay for such thing. If they think the target price is so low that they cannot afford the sell of the product, they will simply not offering it to you. Elsewhere, why charging less and make no profits? So, for me, the price of any products or services is never related to what the product worth, really. Oh, and yes, they make a lot of study to find this target price. But as I said, this is nothing related to what the product actually cost to produce.