Depreciation of software : Thunking for work

What is the rate of depreciation of software, or in other terms, "when does the value of a piece of code become approximately zero?". The second aspect to this is how much of the license fee for a new version is for code that has reached this $0 value.

Why I think this is important is the issue of what is "free" and what is "for fee"..

Surely the majority of the code is untouched for a number of releases, and therefore should have a approximated value of $0. Should you continue to pay for this code, or should you be paying for enhanced code or new functions/features.

This type of model is trying to define open source development in terms of a cost+ model.

So it seems to me that giving away this commoditized code is a reasonable step.

So what does this mean for open source business models;

If you believe all software should be free (as in speech), then this logic will never work. But then again nothing will that involves money.

This supports the "for fee" basis of new and innovative components.

It would not make sense for a completely new innovation to opensource from the beginning, unless you cost of development of the core project would be less than the marketing required to get adoption.

Supports individual developers and other associated parties getting paid for developing features (ie. everybody deserves to get paid for their work).

Does not limit "for fee" to deployment & growth aspects as mentioned in Simon Phipps blog, but all new features and functions.

Supports the move to a single or small number (because competition is good to keep the core code improving) of core pieces of code for a given function (eg. how many OS kernels, RDBMS cores etc.. do you need)

Puts more focus on the open source community as consumers of core code and not contributors (which seems to be a common concensus, because contributors are a small percentage and often vendor funded)

There is no doubt that the core code should also be improved over time, but this can be funded through support and other annuity means. If a community is unable to keep it refreshed, then the typical threat of forking always exists.

$0.02