Steven D'Aprano <[EMAIL PROTECTED]> wrote: ... > Thanks for going beyond the call of duty to research the facts in such
You're welcome! Like most amateur investors, I kid myself that research makes my stock picks better (considering the tiny amounts one actually invests, I doubt that any dollar difference divided by the time needed to do research actually reaches to minimum hourly wage, so, it's more in the nature of an excuse, I guess;-). > detail. I'm surprised that Adobe is selling so many licences -- I don't > know anyone who has paid for Adobe software in many years -- and you can > take that any way you like. (Kids! Pirating software is stealing!!!) For reasons that escape me, I appear to observe a much lower inclination to piracy in the Mac world -- which may help explain why Adobe makes over 1/4 of their sales there, according to one of their tables, even though they get strong competition from Apple itself. E.g: surely professional Acrobat must sell less when the OS itself ensures any app can "print" to PDF, as MacOS X does; in the video field, of which I know nothing first-hand, I'm told Apple's Final Cut, express and pro, vastly outsells Adobe's comparable offerings; etc. I guess these effects, and the fact that Macs are less than 10% of laptops and desktops, are overcompensated by a combination of Mac users' higher propensity to purchase rather than pirate, and the higher prevalence of "creative professionals" in the Mac crowd. > "any source of income from services or goods". There is also a more > restrictive (there's that word again...) sense of a sale being a transfer > of ownership. In that stricter sense, nobody sells software -- they > merely licence it. This "legalistic" take has generally little to do with the *accounting* interpretation of "selling" -- and since you were asking specifically about *profits*, accounting is really the only way to answer. But, if "transfer of ownership" is what you mean, you're STILL totally wrong in doubting that there is a lot of profit being made today by selling software -- transfering ownership of software. What do you think the IT giants of India MOSTLY make profits on? While they're relentlessly trying to branch out to other sources, such as consulting and all kinds of services, and starting to show interesting results in these expansion efforts, still today MOST of their profits come from writing software for some customer firm and transferring ownership of the software in question -- i.e., SELLING software by this strict legal definition. In terms of accounting (GAAP) this might in fact be better framed as a service -- "writing software on your behalf" rather than "transferring to you the ownership of this software written to your specifications"; and the operating margins, now that the market for top professionals in Bangalore &c has heated up so much, are aligned with "resellers of services", lower than those of "sellers of software" in the normal accounting interpretation. But you can't have it both ways -- if you mean "selling" in the normal accounting sense, you're wrong as I showed in the last post; if you mean in the legalistic sense, you're wrong as I'm showing here. For each dollar of profit anybody makes, you can no doubt deny it comes from selling software in SOME sense of "selling", since the legalistic meaning conflicts with the accounting one -- but fix any ONE meaning, and you're still wrong. Including the strangely mixed one here...: > The sense of "software sales" I mean is intermediate between the two. The > way I mean "sales", when Joe Public goes to acmesoft.com, pays $99 on his > credit card number to download Acmesoft FooMaker, that's a sale. When he OK, then among companies which make profits selling software are BestBuy, CompUSA and so on -- you're welcome to drill down into their detailed financial reports yourself, but just consider the amounts of precious shelf space that they devote to shrink-wrapped boxes of games, anti-virus thingies, and the like... do you think those retailers don't have any sense of which side their bread is buttered on?-) As a very rough 0th-order approximation, you can take it that those chains' *profits* come in very roughly equal parts from sales of hardware, software, and services (mostly extended warranties on the HW they sell, but also out of warranties repairs, etc etc) -- the sales volumes are WAY higher for HW, lower for SW and lowest for services, but the margins go the other way 'round, by far. This sense of "selling software" of course has nothing to do with licenses: some of the software these retailers "sell" is covered by various commercial licenses, some by GPL or other open source licenses, and some is even in the public domain. So you could say they're in fact selling pretty colored boxes with shrink-wrap, containing a booklet and a CD (and the ownership of these physical components is indeed transferred, so the legalistic meaning of "sale" is fully satisfied too;-). Sometimes there's a license agreement being executed (if "shrink-wrap licenses" have any legal standing -- I'm not sure that jurisprudence in the matter is settled yet), sometimes not, but that makes no real difference to either the retailer's business model or the purchaser's perceptions. Purchasers today are reasonably aware that they might probably download the same programs, in many cases, either for free or at a substantial discount, but they're buying the convenience of loading them from CD (and in the case of, e.g., anti virus defences and personal firewalls, may feel they need that because connecting to the net for the download without such protection may be deadly -- whether the feeling is 100% accurate or not, is neither here nor there). Or maybe they like the colorful box and booklet. But while discussing while a sale is or isn't made through this or that channel is important, it doesn't affect the fact that a sale IS made and brings operating income (thus profits, if the margins are good). Lastly, I don't think your distinction makes much sense. You say it counts as a sale for you if JP pays $99 for the download. But what is the difference if the download is free but the program just downloaded is a hobbled "demo" version? If you want to really USE it, you buy a license which comes with a code to unlock full functionality -- and it so happens the license costs $99. Why do you think it is a crucial distinction as to whether the $99 are forked over to enable the download itself, or just AFTER the download to make the just-downloaded bits useful? Looks like an irrelevant detail to me if I ever saw one... Alex -- http://mail.python.org/mailman/listinfo/python-list
