There is, of course, the periodic cry for government antitrust action from companies that fail to compete with bigger rivals in the marketplace. Just consider that AMD went to European Union antitrust regulators, with chip competitor Intel getting socked with a $1.45 billion fine as a result earlier this month. What’s broadly missed in the antitrust equation is that private businesses serve customers, not politicians and government appointees, and those that serve their market best gain market share.
And then there is the mandate game? That is, why not get the government to issue a mandate that will boost your business?
Consider the open source software movement. While proprietary software is owned by an individual or company and licensed accordingly, open source software is free, with users able to use and alter the code with minimal, if any, restrictions. Open source software has expanded choice and competition in the marketplace, with open source companies making money from offering various applications, services and support.
There are large, established firms, and small entrepreneurial businesses hard at work in either the proprietary and open source realms, or in both.
When it comes to the federal government, according to a May 7, 2009, story from NextGov.com, the Defense Information Systems Agency and the General Services Administration are using open source software.
More broadly, a May 26 Boston Globe article noted: “In a September 2008 survey conducted by Forrester Research, 56 percent of companies that use open source software named cost as the primary motivation. A survey by Framingham market intelligence firm IDC found that 10 to 24 percent of the software purchases made in 2008 by the companies it questioned went to open source, up from less than 10 percent in 2007.”
So, open source software has found some success in the marketplace.
Why then did Scott McNealy, co-founder of Sun Microsystems, call for a government mandate on open source? In January of this year, McNealy told the BBC: “The government ought to mandate open source products based on open source reference implementations to improve security, get higher quality software, lower costs, higher reliability - all the benefits that come with open software.”
McNealy went on to call for a federal government chief information officer. The BBC reported: “He added that the CIO should ‘have veto power, the right to eliminate any hardware, software or networking product that touches the federal network. He or she would have real power, real oversight and employ real consequences for folk that don't realign with the architecture. It's what every business does that the government doesn't,’ he concluded.”
For good measure, on February 10 came a letter to President Obama from some leaders in the open source community. The group declared: “… we urge you to make it mandatory to consider the source of an application solution (open or closed) as part of the government’s technology acquisition process, just as considering accessibility by the handicapped is required today.”
A government information czar? Government software mandates? What’s the point of all of these ill-advised, scary calls for government mandates? Well, one answer might be found in a passing point made in a May 18, 2009, CNNMoney.com article – that Oracle and Sun Microsystems “offer open-source software products for free, but they still have failed to compete with many Microsoft products.” (By the way, Oracle recently announced that it will acquire Sun.)
It always seems to go back to competitors looking to government for special treatment.
The best technology policy for the federal government – indeed, any government – is to look at the wide array of choices in the marketplace, and select the option that is most efficient and cost effective. Let choice and competition reign. Let entrepreneurial firms compete, and let the taxpayers, including small businesses, benefit accordingly. Government mandates only limit choices, thereby limiting competition and potential benefits.
Raymond J. Keating
Chief Economist
Small Business & Entrepreneurship Council
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