[kurthr]

Not the OP, and this isn't something I'm dramatically invested in, but...

Rent seeking would be designing a product for collecting rent (not a one time payment) for a product (e.g. SaS) that doesn't wear out or has separate maintenance costs. Like a house that is rented the value comes from the income stream and it likely is adjusted by something like inflation.

Not renting would be selling a product for a one time fee, perhaps even if there are many customers (you still get to play ticket pricing games like the airlines so different people pay different amounts at different times, but not as variable as rent). Making the product non-transferable blurs the rent line a bit. Also not rental is the maintenance or improvement on the product (or the house) since that is new work that is being done.

It used to be that only physical objects were rented and services were inherently work and required new effort/ingenuity to be solved each time. However, with the introduction of art reproduction (visual, audio, physical) and copyright/patent, as well as, non-perpetual licensing of software this is no longer the case. It's possible to hold a piece of intellectual property and collect perpetual rent with little or no future investment.

It does create a different incentive structure that can be quite customer hostile.

[robertlagrant]

Rent seeking is trying to create a legal/regulatory structure that means you can farm people. E.g. coming to the UK from some countries you need to prove you can speak English. Assuming you can, and you need a waiver on the test, there is a sole organisation you can pay hundreds of pounds to to send them your degree certificate, and for them to say in some government UI "yes, this probably means they can speak English".

It's not just general and optional recurring payments.

[kurthr]

Regulatory lock-in is certainly one method of guaranteeing rent. I'd argue copyrights and patents are as well. Microsoft and Google get accused of rent seeking because of their near monopolies, but I don't think most of their income is particularly based on regulation. You find other forms of lock-in can come from network effects in social media (Facebook), or B2B lock-in due to outsourcing of basic business operations (IBM, Oracle, Salesforce).

[robertlagrant]

I think the accusations can be divided into several categories:

- actual rent-seeking (as you say, not really true for companies such as Microsoft and Google, except where you see e.g. government documents needing to be submitted in Word. But that's very likely incompetence on behalf of the bureaucracy rather than Microsoft)

- having a dominant market position due to having a very high quality product, or set of products that work together well

- a random grudge phrased as rent-seeking, because the Twitter user in question doesn't know what rent-seeking is, but has seen their friends accuse companies of it

I don't know what the proportions are, but I suspect the former is minimal to nonexistent for e.g. Google.

[nonethewiser]

You mean a SAS? The monthly payment goes towards support, maintenance, and further development. Or you could rebuy essentially the same thing every couple years.

[kurthr]

I meant a SaaS, but mistyped it.