Not necessarily. Sellers of pirated CDs and DVDs do very well, for example. That's why drug dealers get into the business: it is more profitable and less illegal.

Although regulatory protection has previously guaranteed profits, these protections are becoming easier and easier to circumvent. Companies are turning to alternative methods to generate revenues. There are four predominant methods of generating revenues based on zero-marginal cost goods. (1) Sell other goods and services bundled with zero-marginal cost goods. (2) Deliver zero-marginal cost goods in a more effective way. (3) Use zero-marginal cost goods to learn about the users of the goods. (4) Deliver zero-marginal cost goods with advertising. The first two focus on being able to generate monetary profits directly related to zero-marginal cost goods. The latter two attempt to generate capital other than monetary profits.

At this point, it is simpler to say that the service business is enabled by free software, rather than saying the software is being sold along with the services. That's obviously true with respect to complementary hardware.

Examples of intangible goods that can be sold include charity from sponsoring a productive activity, community from Apple products, authenticity from bottled water, and emotional security from paying for antivirus software. The very act of paying for the product is intimately related to these feelings of charity, community, authenticity and emotional security.

Perhaps. But that's a really strained way of saying that the consumers bought the product because the product made them feel a certain way. To say that they were sold the feeling is simply an advertising metaphor, not a description of a transaction.

You undermined your argument. Whatever "high quality" means to you, it is evidently distinct from the convenience of delivery.

Same thing. If the real point is that access to other players is controlled at the server, what is being sold is access to services.

This taxonomy is a false simplification. Simpler to say that some bitstreams are used to barter with users for resaleable personal information.

Once again, you get these sentences by distorting a simpler underlying account. Advertisers pay to have their messages attached to other messages or digital services consumers want.

To me this has a little bit the feeling of "making things simple enough for business school students to understand." It's like a report on the Venice Biennale written by a seller of art supplies, or, worse yet, an investor in art supply companies. Everything you say seems to me to be accurate, though much of it can be said way more simply, usually by the straightforward method of treating the commons as a commons, and observing that the commons enables surrounding economic activity in certain relatively predictable ways.

The main question is, so what? We do not attend the art show in order to figure out which art supply companies made money off it: we go to look at and be affected by the art. You have evolved a taxonomy of what the people who do not understand what's going on think about instead. That's not useless, by any means, although I think its utility to any individual businessman is slight. What can it do for those of us who are trying to see more deeply than the superficial level at which the moneymaker swims?