Adobe thinks this is stealing because Adobe doesn’t think that its marginal cost of producing another copy of the software is low. Sure, the out-of-pocket cost for copying some bits and bytes is low, but Adobe wants to include some amount for the cost of writing the software in its accounting of the cost of providing another copy.
/s/marginal/average here. Like most firms facing fixed costs (including e.g. retail businesses), Adobe needs to defray these by charging a markup over marginal cost.
If you can’t figure out how to amortize the costs of the creating the product in the first place into the marginal price of another copy, you literally will never think that large upfront costs are a good idea.
Yes, with the proviso that there might be ways to defray these costs efficiently after all. For instance, use a provision-point contract (as seen from Groupon, Kickstarter, etc.) to pay for the fixed costs, and sell the product at marginal cost (zero in the software case). [This doesn’t solve all issues, e.g. because markups also have good incentive properties; but it is a huge step forward.]
In practice, price discrimination also helps; if Adobe can figure out Puya Sharif’s willingness-to-pay, they will sell him Photoshop at a lower price. Firms can approximate this outcome by creating a scaled-down version of the product (say, Photoshop Elements) which will sell to low-demand customers without cannibalizing sales of the up-market version (Photoshop proper).
/s/marginal/average here. Like most firms facing fixed costs (including e.g. retail businesses), Adobe needs to defray these by charging a markup over marginal cost.
Yes, with the proviso that there might be ways to defray these costs efficiently after all. For instance, use a provision-point contract (as seen from Groupon, Kickstarter, etc.) to pay for the fixed costs, and sell the product at marginal cost (zero in the software case). [This doesn’t solve all issues, e.g. because markups also have good incentive properties; but it is a huge step forward.]
In practice, price discrimination also helps; if Adobe can figure out Puya Sharif’s willingness-to-pay, they will sell him Photoshop at a lower price. Firms can approximate this outcome by creating a scaled-down version of the product (say, Photoshop Elements) which will sell to low-demand customers without cannibalizing sales of the up-market version (Photoshop proper).