This curiosity appeared today, courtesy of The Register. Steve Ballmer this week came up with a novel and somewhat paradoxical explanation for high levels of software piracy in emerging economies. Hardware, he says, is too expensive. What these people need, he said, is a $100 computer.
"One way to stem piracy is to offer consumers in emerging countries a low-cost PC. There has to be... a $100 computer to dow-market in some of these countries. We have to engineer (PCs) to be lighter and cheaper".Take into account the paraphrase and the nip and tuck and it's pretty clear that the quote isn't exactly as it left its mother (says the piece in The Register), but in any event he is talking about piracy as being Microsoft's biggest problem, and he is talking about ultra low cost PCs being the way forward for emerging markets. He's certainly right about how a $100 PC would be a great enabler, but it's entirely unclear how this would stop people who pirate Microsoft software because they can't afford it from just carrying on.
There is however no reason to reduce prices, says Ballmer, because most of the people can't afford PCs, so obviously don't steal software, whereas the people who can afford PCs are "relatively affluent" and can therefore afford software. And "those affluent people cannot pay, so they don't pay," he adds bafflingly. Assuming he meant to say something opposite, then you could kind of pursue the logic. There's no point in cutting prices because the people who have computers can afford to pay, but just won't. But if the people who don't currently steal software because they can't afford computers suddenly can afford computers because they're $100, then... Well seeing they still can't afford software, won't they start stealing it?
The IPKat wonders if (i) there's anyone out there who can explain the logic of this apparent paradox to him; (ii) anyone can tell him exactly what "dow-marketing" is. Is it something to do with the Dow Market?
More paradoxes here, here and here
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I will not throw myself in explanations of this confusing statement but high prices is, oddly enough, the main argument of the s/w pirates in my country. Their logic is simple: if rich American companies reduced prices more s/w would be sold and the total income would be higher.
ReplyDeleteI am not quite sure about the total income but I draw an analogy with cars - when someone can't afford Lexus he buys second-hand Kia but not borrows the neighbor's car.
Usually this answer was met with a sarcastic smile.
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ReplyDeleteAdvertising can be a big problem otherwise. A lot of companies reserve a big chunk of their budgets to cover marketing expenditures.
ReplyDelete