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From Dave Fisher <dave2w...@comcast.net>
Subject Re: $21 million per day
Date Wed, 06 Feb 2013 20:54:12 GMT
Hi Sally,

Please see this message thread: http://mail-archives.apache.org/mod_mbox/openoffice-dev/201302.mbox/%3CCAP-ksoiJx5QqRvAQpHTJJ2_VasPCji9gTi4R3PH8bg_ntwkJ9A%40mail.gmail.com%3E

Rob is working on a blog post, but I think that this is something worthy of an ASF press release
as it shows substantial value provided to the public.

Thanks and Regards,
Dave

On Feb 6, 2013, at 12:42 PM, Rob Weir wrote:

> On Wed, Feb 6, 2013 at 8:43 AM, Rob Weir <robweir@apache.org> wrote:
>> Yes, yes, we're a non-profit organization.  We don't charge for Apache
>> OpenOffice.  We don't pay developers.    But we still do produce
>> something of value, and that value can be estimated.
>> 
>> People need office productivity software.  The main alternative to
>> OpenOffice is Microsoft Office, perhaps the "Home and Student"
>> edition.  The latest version (2013) sells for $139.99 on Amazon.  This
>> is for the downloadable version.
>> 
> 
> So I'm thinking more on this, and there is an assumption here that the
> price I pay for Office in the US is the same as anyone else pays
> around the world.  But this is unlikely to be true.  This is a classic
> example of where the fixed costs are in the development and are high,
> and the variable costs are in the media and distribution and are very
> low.  So a global vendor's optimal strategy is to adjust the pricing
> country-by-country or region-by-region, to maximize their profits.
> They can drop the prince in some countries and raise it in others
> based on ability to pay.
> 
> I'd love to have some help exploring the magnitude of these
> differences, to see if they are significant.  Let's use the price
> Microsoft quotes for "Home and Student 2013".  We want the 1PC
> perpetual license, not the per-year subscription price.
> 
> Start from here:  http://office.microsoft.com.  I had to then go to
> "Products", "For Home" and "Learn more".
> 
> When I check the US price I get $139.99
> 
> When I check the German site (http://office.microsoft.com/de-de) I am
> quoted 139,00 €.  That is $188.04 today.
> 
> When I check the Australian website I am quoted $169.00 which is $174.42 USD.
> 
> The Russian website quotes 3499.00 rubles, which is $116.30.
> 
> So I'm seeing some higher and some lower.  Does anyone see pricing
> that is outside of the range USD 116.30 - 188.04 ?
> 
> This complicates the analysis, but I don't think it changes the story much.
> 
> -Rob
> 
> 
> 
> 
>> We have averaged 153K downloads per day of Apace OpenOffice over the
>> last week.  That is an average value to the public of $21.5 million
>> per day.  Or $7.833 billion (7.833 thousand million) per year.
>> 
>> To put that in perspective, here are comparable annual sales figures
>> for some familiar companies:
>> 
>> -- Campbell Soup Company:  $7.882 billion
>> -- Royal Caribbean Cruises:   $7.657 billion
>> -- Mastercard, Inc:                $7.391 billion
>> -- OfficeMax:                        $7.094 billion
>> 
>> 
>> So we're providing tremendous value to the public.  We should be proud
>> of what we've accomplished over the past decade.
>> 
>> Note:  We could certainly debate the exact value provided to users.
>> Determining what a user would do if they did not get AOO for free is
>> tricky.  But the logic above is similar to how the BSA estimates
>> losses to Microsoft from software piracy.  They assume that the person
>> who pirates Office would buy it if they did not pirate it.  So it
>> seems fair to use that same logic to estimate the value provided to
>> users by a legal free alternative like Apache OpenOffice.
>> 
>> Regards,
>> 
>> -Rob


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