The libertarian technologist space specifically prefers technological solutions because they don't depend upon fallible and corruptible humans implementing the laws. This is the ideological wing that gave us the PC, encryption, the Gnu project, free software, the Internet, P2P filesharing, Bittorrent, social media, Bitcoin, Ethereum, Tor, Freenet, Mullvad and other VPNs, Monero, etc.
When it comes to laws, libertarianism faces an internal contradiction. A libertarian believes that they shouldn't be able to control other people; therefore, if a company wants to make an unrepairable unrootable surveillance device and the population consents to using it, the libertarian believes that it is not their right to interfere. The only thing they can do is create a better repairable rootable device, which is how we got GCC, Linux, Ubuntu, Firefox, Graphene, etc.
Some left libertarian positions support collective action to dismantle hierarchical power systems. It’s just difficult (impossible?) to maintain this sort of group orientation at scale; it inevitably devolves into factional power seeking/domination politics.
You're referring to various strains of anarcho-libertarianism, correct? I'm more familiar with geolibertarianism as a left-leaning libertarian faction, which doesn't have these stability problems, but does have a huge initial-conditions problem (it's nearly impossible to institute a land value tax in a society that doesn't already have one because of the effect it has on land prices, which are a primary storage form of wealth).
Yes, but those are the largest left-libertarian groups right now. I don’t think that Georgism would have these issues but you’re also correct about the difficulty of implementation. (It is garnering some interest in the UK, although I fear they will botch any implementation due to the immense power of the landowner class there.)
And yet the company can afford to spend an extra $0.10 per sale on marketing, which quickly drives the free option to the fringes because marketing drives almost all purchasing decisions.
Sad but true. Many libertarian options are comfortable being on the fringes, though, and just build for other libertarians. They lack economies of scale, but software's natural economies of scale (zero cost of reproduction, combined with diminishing returns to complexity) can often make this economical anyway as long as your audience doesn't mind not having the absolute highest level of UX polish possible.
And then when a libertarian option finds itself getting mainstream, it quickly gets co-opted by authoritarian market forces, because they are so powerful. See how Git got coopted by GitHub, and half the stuff AWS does.