Economics was developed to deal with atoms, not bits (paraphrased from NicholasNegroponte). Some very fundamental assumptions present in what people think of as "economic laws" simply don't apply here:

	* Limited Resources: NetworkExternalities work the opposite way. Example: The more people use the internet, the more it is worth to any of them.

	* Variable cost for another copy (or 10, or 100000) of a piece of software: practically zero.

	* Cost of Transportation: With bits, there virtually isn't any.

	* Moore's Law: The price/performance improvement regarding chips is so strong and predictable that it causes economic effects of its own.

--FalkBruegmann

The inapplicability of "conventional economics" to these issues is often
overstated.  People who are really interested in this kind of thing might
look at: http://www.stern.nyu.edu/networks/site.html  (warning--although this
site has lots of useful information, it also has really annoying animated
icons and sound effects, so be prepared!) --MatthewWilbert

I dunno, when people say, "This time it is different," I think automatically, "Hold on to your wallets." -- Anon