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Joel on Software

June 24th, 2002 · No Comments

Joel on Software is a must-read for anyone in software development. Here’s a small excerpt from his Strategy Letter V:

All else being equal, demand for a product increases when the prices of its complements decrease. In general, a company’s strategic interest is going to be to get the price of their complements as low as possible. The lowest theoretically sustainable price would be the “commodity price” — the price that arises when you have a bunch of competitors offering indistinguishable goods. So, smart companies try to commoditize their products’ complements. If you can do this, demand for your product will increase and you will be able to charge more and make more.

Tags: Software

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