No. Profit is made by selling a good for higher than its cost. The underlying value has no bearing on the ability to profit, and as mentioned above, this is the fundamental flaw that Marx could never get over.
Nope. Marx's mistake again, with a twist based on
obsolete utility calculations. The entire field of
price theory sprang up because people keep making this mistake.
The price reflects a relationship between
supply and demand, not supply and
value. Demand does not equal value, even though they have a relationship.
First rule of hardcore systems analysis: if someone tells you something is infinite, laugh in their face.
I'll skip an autistic definition of "information", which itself blows holes in this argument, to keep things focused on software games. The essay is saying that you can
reproduce a set of code an infinite number of times. This is true, but that reproduction is not cost-free;
some resources are used in doing it. The author is just accustomed to treat those resources as trivial, which is fine for every day life, but is not fine for economic theory; they must be accounted for.
Say the game "Final Fantasy 7" exists. I know it exists, the author announced it. Where does it exist?
The minute it is finished being authored, it exists as a long string of digits occupying physical media somewhere. That media might be a "gold disc" master CD, or a hard drive in a server. The supply for the game is exactly 1 unit: the physical digits on a physical medium.
How do I acquire the product?
That string of digits must be reproduced, taking up space on other media. The old school way was to copy that string onto other discs and sell the discs. The new way is to open up remote access to the server, and let you copy the string to your local hard drive. But
both ways consume resources.
Even when you download it, you are consuming bandwidth from the server owner and from your own ISP, and storing a copy on your limited physical hard drive. If you think that software is "infinite", try downloading it an infinite number of times and see how long it takes until you smack into a limitation, either from your HDD or your ISP.
"But it's being shared and pirated after it's reproduced once!" Then you are consuming resources from the pirate site. Try downloading from them an infinite number of times, see what happens to the "infinite" availability.
Limits exist. Just because you (currently) enjoy a surplus of resources, doesn't meant you can't hit the limit. And you can't take the surplus for granted when making sweeping, total claims.
- The product doesn't have infinite supply, even if it could theoretically be infinite.
- An infinite product still has value even if it doesn't command a price.
What's the value of the air you breathe, which no one is currently charging you for? Air isn't technically infinite either, but you enjoy a surplus of it. If someone cut off your air supply, within 10 seconds you'd consciously recognize the hidden value you've always placed on air. Within 20 seconds, you'd discover you're willing to pay an
infinitely high price for that infinite product.
(You also contradict your earlier claim that "the price paid is derived from that value provided". If you pay $0 for your infinitely supplied game via piracy, do you derive 0 value from it? Why would you pirate it in the first place if the real value was 0? Either the software/information has value or it doesn't, and if it has value while still being infinitely supplied, then every line you've written is nonsensical.)
Try this experiment at home.
- Hook up a Playstation to your TV.
- Print out the source code to Final Fantasy 7.
- Insert the 5-inch thick binder of source code into the disc slot.
- Enjoy the game.
Get stuck around step 3? Most people do. If only you had someone to package the information into a usable format for you. I wonder how much you'd pay for that service?
Oh, but you're PC master race. I can tell by your disdain for physical media. You don't need any help from the publishers to run a game, you'll download it and do it yourself!
Got your compiler ready? Have enough juice to re-render each frame of the cutscenes to be compatible for your graphics chip? Ready to get your hands dirty with some good old-fashioned VM console commands? No? Ah, you expect the information to be pre-packaged, already compiled, single-click to install, automagically recognizing your computer setup and adjusting to your graphics card. That sounds like a valuable service to me.
(And no, Mr I'm A Linux User, you aren't a super l33t hax0r willing to spend 20 hours of your weekend reconfiguring packages and re-compiling just to swing a buster sword in 1080p. At some point you'll crack open your wallet and just play it on Wine.)
Haha, Harvey, you're being facetious. Even the ready-to-install binary is available and infinite! Others have cracked it, taken it from its native distribution, re-packaged it, and are hosting it at the cost of their own bandwidth! I shall turn on AdBlock
so even the pirates don't get paid for their valuable services, and acquire this "free" product!
What's that? PirateBay is down again, your ISP restricted your torrenting to 350kb/sec, and the package you downloaded from FranksFilthyWarez had a trojan rootkit in it? That doesn't sound like free infinite rainbows. Sounds like you're about to trade your time and security to avoid paying money for a guaranteed product install.
And hey, if your time is that worthless, go right ahead. But if you're going to spout off about economics, you are required to acknowledge that tradeoff. You
spent your time, you acquired the software at a cost, even if the price wasn't paid in dollars. You don't get to hand-wave that away in a spew of Marxist bullshit.
Considering you have no idea what "value" means, your attempt at moral-fagging is just laughable.
The true
value lies in the game experience. Part of the
total value is determined by how easy it is to get that experience. Do you merely need to download it? Do you need to download and pay? Walk into a store, pick up a disc, and pay? Etc. Different people value each of those routes at different levels; stack that on top of the underlying game experience, and you find their
demand for the game.
The
price is a function of the public's demand for any of those services against how easy it is for the publisher to supply that service. Paying the price is a transaction, i.e. a contract, and the state only gets involved in enforcing that contract.
Even at the most trivial level, you are paying resources. You may jump through hoops and break some laws to avoid paying it out in dollars, but someone, somewhere is providing you a valuable service, whether publisher or pirate site. Copying software is not frictionless duplication of infinite goods.
Bullshit. It doesn't matter how much demand there is for a thing,
producers will only produce it if they can turn a profit.
The sentiment quoted above is the hallmark of socialist planners everywhere, who think that producers are magical underworld elves who just mysteriously create wealth out of thin air. If everyone who demanded a game pirated it and profits dropped to 0, the producer would take that as a signal and produce no more games. Perhaps you could get enough dupes to keep producing games into 0-profit environment, but not for long. Eventually, the producers run out of resources, the market runs out of producers, and the games stop coming, no matter how much demand or value the pirates put on them.
Because here's where idealists of every ideology always forget the difference between free markets and capitalism. Free markets mean you can trade whatever you want, with whoever you want. It's the default mode of human existence, and a great way to discover supply/demand/prices. But it's not a mechanism for bringing new goods to market. It is not a guarantee of either supply or demand for anything.
Capitalism is a way of investing stored wealth (capital) into the production process. It lets you bring products to market that don't have an established demand, and the storage of capital provides a buffer for producers who realize insufficient profit on any single offering. Capital paves the way for entrepreneurship, and capitalism ultimately provides more goods and opportunities for value to both producers and consumers. But capitalism doesn't remove resource constraints; it merely shifts things to smooth usage out over time.
The free market is
not the magical cargo fairy that delivers whatever you want if you just wish for it hard enough.
Profit moves the Invisible Hand; not value, not technology, and not demand.
"Let's wreck everything with no plan for the future and only rhetorical assurances that a better way is out there ready to emerge."
Go walk out into the ocean, comrade. When you're flailing at the bottom of the sea, I am certain air will be provided to meet all the demand that exists in your lungs.
