Contractor Discounts When Working With Open Source?

mborland asks: "As I am contemplating doing contracting for a living, I have set my rates, and am allowing hiring organizations the option of a discount if certain portions of my work are released into the public domain under GPL. This at least benefits me, as I can feel free to easily reuse code for other projects; it arguably helps the organization, especially if the code is any good to begin with, and gets improved over time. If I do work for an organization which requires, for various reasons, that the code be propriety, then they pay full price--and they are happy to do so. But most places who just want something to work well and do not care about code ownership are happy to consider a price reduction. Any experiences with this? Thoughts?" This is an interesting way to professionally advocate the use of Open Source. What do you think about this practice, especially those of you working in the industry as contractors?

Comments

Re:A Bad Idea for the company

[lizrd]

I agree with you that in many instances what would be lost by giving away the knowledge contained in source code would not be beneficial to a company and that for normal employees a blanket opensource clause in the contract might not be appropriate. When considering a contractor the situation is quite a bit different. A contractor is generally hired to complete one specific project which may or may not pertain to the company's core technology. If the contractor is being hired to develop software from an overhead rather than a development budget then it would likely be prudent to take a discount for having the development done and not be particularly concerned about giving the software away when it is finished.

As an example, I have a company which makes widgets and I need some inventory management software written. Inventory software is not directly related to the technology of making widgets and as a result I have few programmers on staff who would be proficient in writing such software. Therefore I decide to hire a contractor to write such software for me. Since this software is not core to my business I am quite sensitive to the price of obtaining such software. If someone were to offer me a price break in exchange for giving away the application when it is finished that's fine. I will get what I paid for (inventory software) and what else results from that is of little consequence to me. On the other hand, If I were running a company that produced inventory management software I would feel very differently about this situation.
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License issues

[lizrd]

You will need to be careful if you release code to the open source community and plan to use it again in future projects which will not be open sourced. If you are using the GPL you will need to retain your copyright to your own work and keep it separate from any work to which anyone else contributes to. There is nothing preventing your from releasing your code under several different licences as long as you actually own the copyright to all the code involved. Once you begin incorporating other people's contributions into GPL'd code it's GPL'd.
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A Bad Idea for the company

[ClubPetey]

While I like, use, and support Open Source ideas as a developer, I must put on my Corporate hat and spend a moment to speak for the corporation.

Having started a few corporations of my own, I have learned many things about the value of a corporation. In the end, as an employee of a corporation, your success is tied into the success of the company (Unless you are the type of employee that has no stake or interest in the company you work for, in which case you should quit, becuase you are not doing anybody any good). The success of your company is measured by it's value. So how is value determined?

The contracts - The most valuable thing in an organization is the contracts held by that organization. Whether it be a long-term agreement by a long-distance carrier to supply service at a greatly reduced rate, or it's a contract with an employee to not divulge or develop the company's business practices with competitors. Any contract with an "open source clause (OSC)" like the one metioned would immediately devalue any contract it was in.

The technology - For many "infrastructure" or software only companies, their value hinges on the technology the have designed or coded that their competition does not have. For example, Veritas, their company is based around technology (and the software to implement) backup systems, server clustering and the like. Obviously an OSC would give the technology away to anyone who wants it, thus devaluing the company.

Barriers to entry - Never thought I'd use something from ECON 101, but here it is. Akin to techonology is the barrier to entry. This creates value in a company by making it difficult for prospective competitors to enter the market. Sometimes this takes the form of patents, other times a truely complicated algorythm. Another popular form is a closed data file format. All these things make it more difficult for competitors to compete, making your company more valuable. OSC would alomst destroy barriers to entry. You can't get a patent on something that Open Source.

Notice that "money" is no where on that list. The value of a company depends very little on the money that a company has, but on what intangables it contains. Why? Beucase intangables can be converted to money at varing values. A dollar is always a dollar, but a contract for a dollar could be worth $0.65 or $20. So saving 10% or 30% off the cost of writing something is really not a good bargin when you are calculating the value of a company. In the end, I cannot fathom why any company whose goal is to make money would want to release it's work to the Open Source community. Does this mean a company should not use open source software? HELL NO! Open source software is very cost-effective, and (most is)well-supported. It's when the company moves from a user of Open Source to a developer of Open Source that the problems arise.
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He had come like a thief in the night,