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▲ imtringued 8 hours ago

You completely missed the point.

AnthonyMouse gave you a overly lengthy rebuttal without getting to the point but the cost structure of IP is as follows: the marginal cost of making a copy is low enough to be negligible compared to the fixed cost of creating it.

This means the theoretical marginal cost is equal to the development cost divided by the number of paying customers. Where the development cost can either be a one time expense or an ongoing expense.

Companies make the fixed investment (or take someone else's fixed investment like an open source project) and they charge market rate pricing. The difference between the marginal cost (which is dropping with scale) and the market rate is economic rent or producer surplus. Competing companies pop up and work on their own product because they see the producer surplus and want a piece for themselves. This is how you get many companies wast the producer surplus on reinventing the same software over and over again.

Now with open source software you have the opposite problem. The marginal cost is zero, but the fixed cost still has to be paid. This means that the customer gets something that they would otherwise have to pay market rate pricing for free, this is consumer surplus. The marginal cost that the consumer would have to pay to keep the project alive becomes irrelevant the more consumers there are, which makes open source a financial tragedy because it fixed the cost structure problem at the expense of self sacrifice.