Software

Some Fundamental Differences between Hard- and Software
Traditional market mechanisms rely on supply and demand of physical objects. Sinking supplies result in rising prices and vice versa. Software does not physically exist in the material world. It can be duplicated at very low costs resulting in virtually endless supply. Therefore traditional market mechanisms do not apply naturally and have to be enforced by all kinds of measures (software locks, hardware locks, legal means, etc.).

The following table lists some properties of software and hardware. It shows that there is a fundamental difference between a physical good and software. Business models can take this into account and treat software not as a limited good but as an endless resource.

Free Software licensing and Open Source development methodologies take this into account. Proprietary licenses instead try to build a framework to compensate the inherently missing materiality of software.