Is software a commodity?

[roodzwijntje]

EMIL said:

Is Software a commodity?

I'm going to disagree with everyone because I think that software is
not a commodity and embodies no labour time. For a start it can be
exactly reproduced at zero cost, unlike a Picasso which can't be
exactly reproduced at all.

If you think that software is a commodity, then so are simple
mathematical algorithms (like Euclid's algorithm for finding the
highest common factor of a number, which was invented by the Anicent
greeks.)

I think this because a piece of softare is purely an idea. It becomes
commodified when put in a box and sold, but I think it is an
artificial commodity. (not sure about my terminology here.... have not
read Capital, am just making this up as i go along..)

If you put Euclid's algorithm in a box and sold it, then does that
make Euclid's algorithm a commodity? Because it embodies the labour
time of the anicient greek who thought it up?

I realise that this probably makes digital music and art also not
commodities since they are just ideas as well, with zero cost of
reproduction.

Reducing things to absurd levels: digital music/art is just sequences
of 1's and 0's. This is a sequence of 1's and 0's:
01010111001010100101010100010100101 (c) E.R.Vaughan don't copy this
sequence it is my intellectual property!!

[roodzwijntje]

AARON replied:

>Is Software a commodity?


Yes, Software is a commodity. Price makes not a commodity. In fact,
air is a commodity. So is song. What makes a commodity is want and
need.
 

>> If you think that software is a commodity, then so are simple
>> mathematical algorithms (like Euclid's algorithm for finding the
>> highest common factor of a number, which was invented by the Anicent
>> greeks.)


Ideas can be commodified, but they are difficult to regulate and thus
have spawned this ridiculous notion of "intellectual property" which
has been one of the basis for our current discussion.
 

>> If you put Euclid's algorithm in a box and sold it, then does that
>> make Euclid's algorithm a commodity? Because it embodies the labour
>> time of the anicient greek who thought it up?


It would remain a commodity, but it's value would be increased by the
labour put into the box. We do not need other peoples labours to
breathe air, and that is precisely why it doesn't cost anything. You
better believe that under capitalism, had air become scarce we would
be paying for it.

This is precisley why Marx explained that socialism does require a
certain advancement of the means of production. When commodities are
scarce, "all the old crap arises" (I believe that is the quote). In
this manner, when commodities do become scarce, the value of them
tends to increase (like the Picasso painting). This has been used as
an argument against Trotsky's theory of permanent revolution, but they
do not take into account the uneven development capitalism produces.
But this is an altogether different discussion.
 

>> Reducing things to absurd levels: digital music/art is just sequences
>> of 1's and 0's. This is a sequence of 1's and 0's:
>> 01010111001010100101010100010100101 (c) E.R.Vaughan don't copy this
>> sequence it is my intellectual property!!


There was a point where I believe IBM or even Microsoft tried to
copyright the Binary system. I wish I could find more information on
it, but it was as recent as at least within the past 6 years. Indeed
it is absurd... but as the saying goes, anything for a dollar.

[roodzwijntje]

HEIKO replied:

3. Commodity.
Capitalism has always functioned on the basis that intellectual property
has value, that ideas have value. (more than manual labour).
There is time taken to produce software, that time determines it´s value.
(if it is wanted by someone of course)

[roodzwijntje]

I say as a sidenote:

 There was a point where I believe IBM or even Microsoft tried to
copyright the Binary system. I wish I could find more information on
it, but it was as recent as at least within the past 6 years. Indeed
it is absurd... but as the saying goes, anything for a dollar. [/B]

This is probably an urban legend, isn't it? I could't find anything on this except this dubious link: http://www.abarnett.demon.co.uk/msbinary.html
which has the title "Microsoft enforces copyright of binary numbers"

[roodzwijntje]

To add to the debate, this is something Heiko said in an earlier email:

Gates can afford to give away. Not simply "because of the record profits" but because like all software and weightless commodities
making one copy or 10 billion costs no more. Here we have the
key questions concerning the economics of software and the
special nature of robber barons of the information age
like Gates.

So how do we define "software" then? Is it just a commodity as, say, soap, with the only distinctive feature that it is extremely cheap to reproduce, hence leading to record profits?

[roodzwijntje]

HEIKO added:

The value of the commodity software is determined by
the socially neccessary labour power contained in it,
same as anny other.
Music, film and books are the same. What is a book
if not a combination of letters, a film but a combination
of colours and sound on tape or celuloid, music a combination
of notes, on disk, tape etc? There is no mystery in these
things, the fetishism of commodities is where the madness
of musicians with billions comes from.
A picasso painting can be copied, only the original is valued
at astonomical levels, due to its uniqueness.
Softtware is no different to the ab ove examples.
ONLY the original creation contains new value, electonic
dissemination adds no new value (the same is true of
film, music and so on) Film and music industry parasites
are fighting rearguard actions to stop the tide like
King Kanut. In order to plunder billions more before
they lose the dissemination earnings. (idiotic musicians
have been brainwashed or conned into signing such contracts)
Many musicians, programmers and so on, will have to find other ways
to make a living (under capitalism), or under socialism will have to make music
for the love of music rather than the love of money. It may well
produce dramatically superior in quality.

[Aaron]

As for my statement about IBM and Microsoft, it was something really ridiculous they were trying to copyright. I know it was true, I just can't remember what it was.

Microsoft might have been trying to copyright the usage of machine language or something like that.

All I remember was talking about it with my Dad, who is a staunch Thatcherite and a self-proclaimed Royalist, and its ridiculousness being one of the only things we agreed on.

[emil1848]

This group has some good info about patents: http://www.pubpat.org/

Anyway, there are some ridiculous ones granted in the past, one is the patent for the hyperlink which BT owns. I believe that they have acknowleged that they cannot enforce it though.

The way the patent system works, there are a lot of patents which are not enforcable in court (mainly because "prior art" is available - i.e. proof that someone else invented it first) , so the companies don't bother attempting to enforce them, but because they are not ever challenged in court the patents stay on the books for the 20 years.

I think the questions that need to be answered are:

1. Were patents progressive during the progressive era of capitalism?

2. Are we in favor of patents at all now? i.e. obviously they are unnecessary under capitalism but do they play a role in checking the power of monopolies under capitalism?

Emil

[Aaron]

I don't know if I would call them "progressive", necessarilly.

Would you call "the law" progressive? Not really, but it does serve a much needed purpose. In order to be "progressive" you must have something new. Patents and Laws simply strengthen the current system, rather than improve it.

Like the law, patents further protect private property which is absolutely necessary under capitalism. The patent simply extends the private ownership of physical "things" (land, factories, etc) to "ideas".

[ckaihatsu]

Hi, everyone, I'm posting here for the first time -- thanks, Maarten, for steering me toward this discussion.

I whipped up a diagram to illustrate the continuous qualities of the abstract values (commodity, "value") being discussed -- please see below.

And I'd like to add that one fundamental prerequisite for commodities is scarcity, even if it's artificially produced, as with mainstream media distribution channels. That is, the practical technology exists for absolutely free software and content distribution, globally -- even despite capitalism's inherent scarcification process, the leasing of the lines.

Regarding scarcity please see this discussion:
http://archives.lists.indymedia.org/imc-chicago-working/2003-September/001500.html

The diagram is at
http://chicago.indymedia.org/media/all/display/14446

Feedback is always welcome.


Thanks,

Chris






___

Two letters on Bill Gates  [computer technology/Marxist revolution]
http://www.marxist.com/scienceandtech/bill_gates_letters.htm

G.U.T.S.U.C., Revised -- A Thought Experiment
http://chicago.indymedia.org/newswire/display/54545/index.php

Favorite web sites: chicago.indymedia.org, wsws.org, marxist.com, rwor.org, whatreallyhappened.com, moneyfiles.org, informationclearinghouse.info, blackcommentator.com, truthout.org

Photoillustrations by Chris Kaihatsu
http://community.webshots.com/user/ckaihatsu/

[roodzwijntje]

The diagram is at
http://chicago.indymedia.org/media/all/display/14446

Hi Chris,

welcome to the board. I tried to open your diagram but I can't, seems like a dead link.

[emil1848]

Hi all, i've been doing some more thinking. Also I would like to see your diagram Chris but can't access it!

Land and software are traded as commodities because land is scarce, etc. and basically the law makes them commodities.

But it seems to me that software (like land or abstract ideas - software is just an idea anyway) don't contain value, ie. labour time. They are "artificial " commodities which need laws to make them such.

Emil

[roodzwijntje]

Originally posted by emil1848
Hi all, i've been doing some more thinking. Also I would like to see your diagram Chris but can't access it!

Land and software are traded as commodities because land is scarce, etc. and basically the law makes them commodities.

But it seems to me that software (like land or abstract ideas - software is just an idea anyway) don't contain value, ie. labour time. They are "artificial " commodities which need laws to make them such.

Emil

It's not because it is not scarce (software is very easy to produce, without any cost almost) that it is not a commodity. It *is* a commodity because what else are prgrammers doing than putting their labour time into one kind of product, i.e. a software packet? I don't think there is much difference compared to other commodities, software just happens to be "weightless" and very easy to duplicate without any cost, one of the reasons why the richest man of the world comes from the software industry, I guess.

That is, if they work for a private company. The matter is a bit different if we talk about programmers writing code in their spare time and distributing it for free. Then you can't speak about a commodity I think.

I found an interesting text on the Oekonux site, titled "Free Software and Market Relations"

http://www.oekonux.org/texts/marketrelations.html

Check their website, this is what they say about themselves:

In Project Oekonux different people with different opinions and different methods study the economic and political forms of Free Software. An important question is, whether the principles of the development of Free Software may be the foundation of a new economy which may be the base for a new society.

http://www.oekonux.org/

[roodzwijntje]

I will paste some definitions from the Marxists Internet Archive, just to keep our heads clear :)

VALUE ( http://marxists.org/glossary/terms/v/a.htm#value )

The following section was written by:
Vladimir Lenin (edited)

A commodity is, in the first place, a thing that satisfies a human want; in the second place, it is a thing that can be exchanged for another thing. The utility of a thing makes is a use-value. Exchange-value (or, simply, value), is first of all the ratio, the proportion, in which a certain number of use-values of one kind can be exchanged for a certain number of use-values of another kind.

Daily experience shows us that millions upon millions of such exchanges are constantly equating with one another in every kind of use-value, even the most diverse and incomparable. Now, what is there in common between these various things which are constantly equated with one another in a definite system of social relations?

Their common feature is that they are products of labour. In exchanging products, people equate with one another the most diverse kinds of labour. The production of commodities is a system of social relations in which individual producers create diverse products (the social division of labour), and in which all these products are equated with one another in the process of exchange.

Consequently, what is common to all commodities is not the concrete labour of a definite branch of production, not labour of one particular kind, but abstract human labour — human labour in general. All the labour power of a given society, as represented in the sum total of the values of all commodities, is one and the same human labour power. Thousands upon thousands upon millions of exchanges prove this.

As a result, each particular commodity represents only a certain share of the socially necessary labour time. The magnitude of value is determined by the amount of socially necessary labour, or by the labour time that is socially necessary for the production of a given commodity, of a given use-value.

"Whenever, by an exchange, we equate as values our different products, by that very act, we also equate, as human labour, the different kind of labour expended upon them. We are not aware of this, nevertheless we do it."

Karl Marx
Capital, Volume I
Chpt. 1: Section 4

As one of the earlier economists said, value is a relation between two persons; only he should have added: a relation concealed beneath a material wrapping. We can understand what value is only when we consider it from the standpoint of the system of social relations of production in a particular historical type of society, moreover, or relations that manifest themselves in the mass phenomenon of exchange, a phenomenon which repeats itself thousands upon thousands of time. "As exchange-values, all commodities are merely definite quantities of congealed labour time." (Marx, A Contribution to the Critique of Political Economy).

After making a detailed analysis of the twofold character of the labour incorporated in commodities, Marx goes on to analyse the form of value and money. Here, Marx's main task is to study the origin of the money form of value, to study the historical process of the development of exchange, beginning with individual and incidental acts of exchange (the "elementary or accidental form of value", in which a given quantity of one commodity is exchanged for a given quantity of another), passing on to the universal form of value, in which a number of different commodities are exchanged for one and the same particular commodity, and ending with the money form of value, when gold becomes that particular commodity — once the universal equivalent.

As the highest product of the development of exchange and commodity production, money conceals the social character of all individual labour, the social link between individual producers united by the market. Marx analyzes the various functions of money in very great detail; it is important to note here in particular (as in the opening chapters of Capital in general) that what seems to be an abstract and at times purely deductive mode of exposition instead deals with a gigantic collection of factual material on the history of the development of exchange and commodity production.

"If we consider money, its existence implies a definite stage in the exchange of commodities. The particular functions of money, which it performs either as the mere equivalent of commodities or as means of circulation, or means of payment, as hoard or as universal money, point, according to the extent and relative preponderance of the one function or the other, to very different stages in the process of social production."

Karl Marx
Capital, Volume I
Chpt. 6: The Buying and Selling of Labour Power

[roodzwijntje]

COMMODITY (http://marxists.org/glossary/terms/c/o.htm#commodity)

Commodity

A commodity is something that is produced for the purpose of exchanging for something else, and as such, is the material form given to a fundamental social relation — the exchange of labour.

Marx saw the commodity as the “cell” of bourgeois society (i.e., capitalism), as expressed in the opening words of his most important book, Capital:

“The wealth of those societies in which the capitalist mode of production prevails, presents itself as ‘an immense accumulation of commodities,’ its unit being a single commodity. Our investigation must therefore begin with the analysis of a commodity.

“A commodity is, in the first place, an object outside us, a thing that by its properties satisfies human wants of some sort or another. The nature of such wants, whether, for instance, they spring from the stomach or from fancy, makes no difference. Neither are we here concerned to know how the object satisfies these wants, whether directly as means of subsistence, or indirectly as means of production. ...

“The use-values of commodities furnish the material for a special study, that of the commercial knowledge of commodities. Use-values become a reality only by use or consumption: they also constitute the substance of all wealth, whatever may be the social form of that wealth. In the form of society we are about to consider, they are, in addition, the material depositories of exchange-value.” [Capital, Chapter I]

As these paragraphs makes clear, for Marx, products of labour may be either goods or services, but in the way Marx understands the term, remain commodities provided only that they are produced for the purpose of exchange.

“For example, when the peasant takes a wandering tailor, of the kind that existed in times past, into his house, and gives him the material to make clothes with. ... The man who takes the cloth I supplied to him and makes me an article of clothing out of it gives me a use value. But instead of giving it directly in objective form, he gives it in the form of activity. I give him a completed use value; he completes another for me. The difference between previous, objectified labour and living, present labour here appears as a merely formal difference between the different tenses of labour, at one time in the perfect and at another in the present. ... “ [Grundrisse, part 9. Original accumulation of capital]

Nor is it important whether they are foodstuffs, clothing and suchlike, satisfying very basic human needs, or we are dealing with labour which meets more ephemeral needs, such as with designer labels, romantic movies or tarot-readings.

Labour is a commodity, provided only that the producer works to meet the needs of someone else, as a means to satisfy their own needs. A good or service produced for the labourer’s own immediate consumption may be a “use-value”, but it is not a commodity.

Likewise, if a woman produces a meal for the consumption of her loved-ones, as part of a domestic contract, whether made before God, before the law or out of simple love, she produces not a commodity, but labour directly to meet the needs of another person, but not just so as to satisfy her own needs, not for payment.

It matters not whether the person actually proffering payment is the ultimate consumer, nor what may be the manner of payment, nor whether payment is made before during or after the labour is carried out, only that the good or service is provided in exchange for payment, to earn a living.

So things in general and products of labour in particular are not necessarily commodities and do not necessarily have value:

“A thing can be a use-value, without having value. This is the case whenever its utility to man is not due to labour. Such are air, virgin soil, natural meadows, etc.

“A thing can be useful, and the product of human labour, without being a commodity. Whoever directly satisfies his wants with the produce of his own labour, creates, indeed, use-values, but not commodities. In order to produce the latter, he must not only produce use-values, but use-values for others, social use-values.

“And not only for others, without more. The mediaeval peasant produced quit-rent-corn for his feudal lord and tithe-corn for his parson. But neither the quit-rent-corn nor the tithe-corn became commodities by reason of the fact that they had been produced for others. To become a commodity a product must be transferred to another, whom it will serve as a use-value, by means of an exchange.

“Lastly nothing can have value, without being an object of utility. If the thing is useless, so is the labour contained in it; the labour does not count as labour, and therefore creates no value.” [Capital, Ch. 1, Section I]

So for example, the work of a teacher is a commodity whether the teaching is paid for by the pupil, the pupil’s parents or by the State. On the other hand, a mother’s education of her child is not a commodity and nor is the work of a preacher who spreads the word of God — the point is only whether the labour was done in exchange for something else.

Marx points out how the circulation of the product of our labour in the market, and how it takes on a “market value” independently of us, and moves from hand to hand through the market until it finds its ultimate consumer, all beyond our control, creates illusions which remind him of animism and fetishism, of primitive religious points of view that endow inanimate objects with human capacities:

“the existence of the things qua commodities, and the value-relation between the products of labour which stamps them as commodities, have absolutely no connection with their physical properties and with the material relations arising therefrom. There it is a definite social relation between men, that assumes, in their eyes, the fantastic form of a relation between things. ... This I call the Fetishism ... of commodities.” [Capital, Ch. 1]

Even though what goes on in the market is nothing but the collective action of human beings, the market manifests itself like a force of nature. Even though the product only has value because it embodies human labour and satisfied human needs, its value appears to be a natural attribute of the product, like its weight or density.

In general, commodities are exchanged at their value, i.e., at their “exchange-value”. That is when one commodity is exchanged for another, on average, in the given society in which the exchange takes place, the two commodities exchanged for one another are of equal value.

“Every owner of a commodity wishes to part with it in exchange only for those commodities whose use-value satisfies some want of his. Looked at in this way, exchange is for him simply a private transaction. On the other hand, he desires to realise the value of his commodity, to convert it into any other suitable commodity of equal value, irrespective of whether his own commodity has or has not any use-value for the owner of the other. [Capital, Ch. 2]

The value of a given quantity of labour offered for exchange on the market, is determined by value structures specific to the given social and historical conditions, and Marx analysed this process of value determination in the same Chapter One of Capital.

“Let us take two commodities, e.g., corn and iron. The proportions in which they are exchangeable, whatever those proportions may be, can always be represented by an equation in which a given quantity of corn is equated to some quantity of iron: e.g., 1 quarter corn = x cwt. iron... The two things must therefore be equal to a third,. ...

“This common “something” cannot be either a geometrical, a chemical, or any other natural property of commodities. Such properties claim our attention only in so far as they affect the utility of those commodities, make them use-values. But the exchange of commodities is evidently an act characterised by a total abstraction from use-value. ...

“If then we leave out of consideration the use-value of commodities, they have only one common property left, that of being products of labour. ... Neither can it any longer be regarded as the product of the labour of the joiner, the mason, the spinner, or of any other definite kind of productive labour. Along with the useful qualities of the products themselves, we put out of sight both the useful character of the various kinds of labour embodied in them, and the concrete forms of that labour; there is nothing left but what is common to them all; all are reduced to one and the same sort of labour, human labour in the abstract.” [Capital, Ch 1, Section I]

Since commodities are exchanged at their value, there arises the question: how is it possible to make a profit? Marx shows that commerce on its own cannot generate new value, but can only distribute value around; both parties to an exchange gain in the sense that they both get what they want, but neither profits, since each give in exchange, a commodity of equal value.

“We are, therefore,” says Marx, “forced to the conclusion that the change originates in the use-value, as such, of the commodity, i.e., in its consumption. In order to be able to extract value from the consumption of a commodity, our friend, Moneybags, must be so lucky as to find, within the sphere of circulation, in the market, a commodity, whose use-value possesses the peculiar property of being a source of value, whose actual consumption, therefore, is itself an embodiment of labour, and, consequently, a creation of value. The possessor of money does find on the market such a special commodity in capacity for labour or labour-power.” [Capital, Ch. 6]