[LeoSolaris]

Software isn't static nor does it exist on it's own. You're not paying for the current version. You're paying for support, security patches, and for the next versions to be written. In the case of software services, you're also paying for administration, active network security, networking, and hardware operations.

Software is a lot like art or literature. The creator needs to be able to live in order to continue creating. Otherwise updates, new versions, and new creations become highly irregular or utterly non-existent.

Profit extracted from companies over the cost of business exist because that is how all businesses function. Profit is literally the point of capitalism. Investment in companies would not happen without the promise of a return. Even the smallest of businesses would not be possible without profit.

For a non-tech example, eggs don't cost $3.99 per dozen to produce. Eggs are expensive because of an extremely high profit margin. Is it justified? Price gouging? Currently there is no hard rule that differentiates the two.

Whether or not there should be a profit percentage cap is an entirely different conversation and not unique to tech. Personally, I think there should be a maximum amount of profit expressed as a percentage of unit cost that should be legal. Further, I think that an equal percentage of the unit cost should always be applied to wage increases equally across the company for non-management roles. Management should be paid out of the extracted profit percentage.

[pHollda]

Your first and second paragraphs are better arguments for subscriptions over one-time payment than they are for the existence of high profit margins despite software's cheapnes.

3rd paragraph. I'm not arguing against profits just, overly high ones in the face of cheap 'raw materials'.

4th and 5th. Questioning high profit margins in businesses (didn't realize eggs too had high margins tbh) and wondering if profits should be capped seem like obviously related things.

Solutions? In the case of SaaS:

— Product pricing starting high, but declining over time (yes, literally making laws that new software MUST be absurdly expensive at first).

Would mean:

(i) Fewer 100th x competitor software product since it's hard convincing people to part with say $100, you need to actually have a 10x solution.

(ii) Increased organic word of mouth growth, since users have an incentive (declining pricing) to increase total users.