Economic Slump hits Open Source

adamjone writes: "C|NET and Yahoo! are running a story about the hit that open source software is taking during this economic slump. Open source development is a hobby for me, not my full-time job. I find that I have more time to work on my project during times when my full-time job is slow, or we don't have enough work. Is open source truly being driven by those who make it their full-time occupation? If so, is there a happy medium for keeping bread on the table and still working within the open source community?" At least Microsoft is doing well.

Comments

It's a recession, what did you expect?

[dave-fu]

Yes, open source as a hobbyist development model can and will persist long into the future, and I'm sure that there will be fun and exciting products as a result of it.
That said, now that the heady, greedy days of the dot com boom are long behind us, it's high time to re-evaluate the position. Money isn't growing on trees and being plucked from the asses of VCs star-struck by that beautiful three-letter phrase (IPO, IPO, IPO!) so much that they can overlook that little thing called "a business plan."
Internet advertising is the redheaded stepchild of the marketing family. Old media ads have no need to justify themselves with inanities like "click-through"; they know their demographic and their real estate is mindshare, that precious commodity which they assume that they're purchasing with their ad dollars, regardless of whether or not this purchase translates into a product purchase immediately or down the road. The internet is a fickle bastard: people gravitate towards the warez model of "buy none, get one free" and so there's the propensity towards stealing everything we can. To wit: the inevitable linking to archives.nytimes.com anytime they've got an article up because registration is such a chore, but if you were to ask the average Slashdotter how they feel about someone using "their" resources without registration (think Anonymous Cowards here), one would instead getsthe impression that merely providing a name and e-mail address is as simple as could be. Hmm. To wit: proxies, ad-killing bots and specialized hosts files that insure that our precious bandwidth isn't eaten up by ancillary ads that might keep the sites afloat, but then again if we don't click on them and buy something might not even if we do see them. Hmm.
Ah, open source. Communism reborn, and who can hate that? Not the watered down Leninism that the Soviet Union ran through in short order, but honest-to-goodness communism. Take what you need, give what you have. Beautiful. A touching sentiment.
Also impossible to be a commercially viable entity when human nature comes into play. If we can get our content ad-free we will, even though it means economic hardship and possibly the closing of the sites we visit and love (or love to hate, as the case may be) and if we can get our software cost-free, without the dirty stigma of clicking through porno banners to find the 3rd word of the 4th paragraph to get entry to L33t b0b'5 h0u53 0f w4r3z, all the better. I whip up a weekend project that is derivative but I'm proud of and off to Freshmeat with you! Maybe even Sourceforge! Take it! Share it!
I'll pour a few hundred hours of blood, sweat and tears into it! Shiny new! Everyone wants it! It's hot!
But how do I parlay it into a commercial venture when everyone can get it for free and fix it up as they want? Hmm.
Open source is a lovely idea with lofty goals, and as long as talented, motivated, intelligent programmers buy into it, it will generate impressive results. Unfortunately, there's a very finite number of talented, motivated, intelligent, ascetic programmers out there who will buy into it.
OSDN's changing business strategies faster than you can say "we're a B2B play now!" (read: brushed up that resume yet?). If bigger ads or a subscription service to a website who doesn't give a whit about the quality of its journalism and doesn't know the meaning of the word "editing", relying on constantly inflammatory agitprop to woo its readership are the order of the day, then I'll just stick with Ars Technica, The Register and memepool (topical, informative, and normally journalistically objective sites), thanks. Slashdot's been a fun little ride, and like many other things, peer moderation was a sexy little idea, just unfortunate in that it pretty much disintegrated into ugly mob rule groupthink. Scene, not herd.

Re:It's a recession, what did you expect?

[Anonymous Coward]

He just cut and pasted this troll from somewhere else though. I don't even remember where, I just remember reading it before.

Sigh... how boring!

Re:It's a recession, what did you expect?

[brunes69]

As muhc as some of you might mod this down as a troll as soon as you see te words "Communism", I'd suggest the opposite: This commentary is very true, as much as you'd hate to admit it. And no, Communism != Evil, as much as American history may have taught you otherwise

Re:It's a recession, what did you expect?

[xskax]

I have a small problem with your reasoning for saying that communism cannot work due to "human nature." The very words "human nature" are in itself an oxymoron, as we define everything we build and do as "man-made" or "artificial." If ou subscribe to this line of thinking, then the words "human" and "nature" should not apply to each other, because as is pointed out, there is nothing "natural" about humans. If all we create and do is artifical, then there is no nature to humans. It is synthetically created by us, for us. So-called "human nature" is more than likely a learned condition that we have passed down to our children for thousands of generations out of a need to survive. After that need had passed and we could live comfortably, there were a few approaches. The "strongest shall survive" in Europe became very popular as feudalism took form. However, if we look into the history of the Native Americans, you'll see that they took a very communal approach, with no real governing body (anarcho-syndicalism). A communistic form of anarchy. Granted, they were technologically lacking, and they did fight amongst themselves, but all in all, a very realizable dream to the modern man. So if we have seen anarcho-syndicalism, which is even more difficult to implement than communsim, why is communism not possible? Granted it still can't happen overnight or maybe not even in a decade. But it is a dream that can be realized. Not impossible.

Re:It's a recession, what did you expect?

[dup_account]

It appears to me that any tribal system works as long as everyone is basically dependent all the others in the tribe for survival (AND that your survival depends on working with the others in the tribe). Once you reach a population mass where you aren't dependent on others or where you can start to leach off the system, then the community model starts to break down and greed starts to kick in.

Even in the tribal model there are still different classes and privileges. It seems like the warrior class is often more privileged than the gatherer/worker class. It is just less obvious because the advantage is not as great, and the warrier class makes a significant beyond being a warrior.

Re:Is that the real cause?

[hmallett]

Sounds familiar...

MSFT sucks

[dattaway]

Yep, Microsoft is doing spectacular. Tell that to the shareholders!

Re:MSFT sucks

[Weerdo]

Sun Microsystems vs Microsoft...

Re:MSFT sucks

[Anonymous Coward]

I think you meant to compare Sun Microsystems vs Microsoft, in which case your point is not so evident.

Re:MSFT sucks

[Anonymous Coward]

Try SUNW(Sun Microsystems) not SUN (Sunoco).

MS vs SUN

Economic slump?

[alen]

It can't be. Has any open source company ever turned an actuall profit? GAAP or pro forma? Truth is it's like any other new business. 95% of the new companies will close their doors within the first three years and the survivors will probably survive for a while because they have good management and a real business model.

Re:Economic slump?

[ivi]

"Has any open source company ever turned an actual profit?"

Perhaps SleepyCat:

C.f. http://www.winterspeak.com/columns/102901.html
(from a recent /. article)

"How soon we forget..."

Re:Economic slump?

[Anonymous Coward]

Economic slump caused by Open Source. Confidence only really fell from the market after the meteoric self-destruction of VA. Many investors were burned big time and their fears proved contagious. Other failures like that of RedHat also contributed but those effects were minor compared to that of VA.

In short, the entire economic slowdown, the loss of jobs, the weakened global economy can be blamed on VA.

Re:Economic slump?

[ChaosDiscordSimple]

Has any open source company ever turned an actuall profit?

Sleepycat Software (makes of Berkeley DB) has maintained a profitable business based on open source since 1996. Cygnus Support (gcc, gdb) was profitable from its founding in 1989 through being purchased by Red Hat. Aladdin Systems (Ghostscript) made enough money for the author to retire.

Re:Economic slump?

[err666]

ACT, the maintainers of the GNU Ada compiler are quite profitable. They are a 100 % open-source shop.

TrollTech is also profitable, but they're not a 100 % open-source shop.

Re:Economic slump?

[TheRealSlimShady]

If I'm not mistaken, Sleepycat made no money from Open Source. It made money from licensing the product in a closed source manner.

Re:Economic slump?

[Bruce Perens]

Only people who refuse to Open Source their own applications pay a license fee. So, this, and also Namesys (Reiserfs) finance Open Source by charging proprietary software vendors. It works.

Bruce

Re:Economic slump?

[cduffy]

Develop open source, sell closed source.

What's wrong with that?

(Btw, I work for MontaVista Software, an open source company. I'm not sure I'm free to discuss our financial situation, but suffice to say we're going through this "slump" just fine).

Re:Economic slump?

[tim_maroney]

Michael Tiemann: Well, as a matter of fact, we were profitable, increasingly profitable, every single year until we attracted so much attention that people wanted to invest money in Cygnus. That happened in 1997.

Red Hat S-1A Filing, January 28, 2000 (search under "3. BUSINESS COMBINATION (CONTINUED)") says that Red Hat lost $1.5M in fiscal 1996, $2.9M in fiscal 1997, $5.7M in fiscal 1998, and $6.4M in the nine months before it was acquired.

Sleepycat employs under twenty people, as does ACT. Peter Deutsch is one person, and may well be discussing a modest retirement in Wisconsin, which is dirt cheap.

So that's less than forty people, none of whom have had the payoff of a second-tier engineer in a moderately successful IPO.

Tim

Re:Economic slump?

[tim_maroney]

I work for MontaVista Software, an open source company. I'm not sure I'm free to discuss our financial situation, but suffice to say we're going through this "slump" just fine.

Really? It looks to me like your growth has stopped -- there's only one job opening for the whole company. Your end of 2000 announcement discussed ten-time revenue growth (from what? it's your first full year), and growth from twelve people to 160, but it was conspicuously quiet on the question of profit. Meanwhile, at that resource load, you're probably burning through the $30 million in investment fairly quickly, though by my back of the envelope it shouldn't be all gone yet.

Don't get me wrong -- you may have good prospects in the future, but it does not appear to me that you are now a profitable company, and the dearth of new job openings is a disturbing bellwether for future growth potential. If you're doing "fine" now, that may only mean that you haven't yet spent all your investor capital.

Tim

Re:Economic slump?

[cduffy]

Errgh... damn, I hope I'm not saying anything sensitive here...

We've hired new people since the published openings stopped, and (last I knew) were at least meeting all our revenue projections without being overbudget. Hence, while we're not profitable at this moment, we've continued to meet and exceed our goals on the plan which puts us at profitability at some [undisclosed here, but not far at all] point in the future.
For being in the middle of a so-called slump, this is pretty damn good.

Re:Economic slump?

[tim_maroney]

That's good. Like I said, you may have good prospects. I just think it's a little early in your corporate history for the company to start getting cited as a success story. Sustained profitability is the measure of business success, and you're not yet there. But I hope you do become a success story, and it sounds like you have a pretty good shot at it.

Tim

Economics of Open Source

[under_score]

There are two fundamentally different approaches to Open Source: capitalistic and communal. In the capitalistic approach, people and companies attempt to earn money by using open source software. The "traditional" model has been to sell value-added services while providing the open source software for free or minimal price. In the capitalistic approach, of course an economic slowdown will be reflected in the open source business sector - just like almost any other sector. On the other side represented by the communal approach, participating in open source projects provides intangible or non-monetary benefits. There is the traditional "itch" factor: you work on an open source project to scratch an itch. There is also the motivation of gaining community recognition. These aspects will not be slowed by an economic slowdown. In fact, they might become even more important: there is not as much cash moving around so a more barter-oriented approach is viable. Corporations not actually involved in developing open source may start to turn more to open source as a solution to their financial constraints. I know that the company I work for does so. They may not directly contribute to the code base, but they certainly are taking advantage of it and therefore increasing the legitimacy of open source. Again, this process is accellerated by an economic slowdown.

Re:Economics of Open Source

[onion2k]

Much as we'd all like the communal aspect to be unaffected it simply isn't true. Anyone who works for a company making their co-workers redundant will tell you that they have less and less time to devote to an outside project. In simplest terms, we have less free time.

Of course, those working on OSS project who are made redundant will have much much more.. perhaps it'll balance out.

Re:Economics of Open Source

[4of12]

here are two fundamentally different approaches to Open Source: capitalistic and communal. In the capitalistic approach, people and companies attempt to earn money by using open source software.

Quite so.

The capitalistic bent on open source is most successful in the use of open source as a lower cost alternative to proprietary software, much of which benefits from various lock-in aspects to increase its price.

It seems like attempts to make money by producing open source software as a sole line of business are fundamentally difficult. The markup is constrained by the costs of making CDs and internet connections, which are constantly improving (this bodes well for the long term future of open source software distribution).

Such companies and ventures are inexorably moved into a position where they sell their expertise as a service to those who wish to use open source solutions in ways that are technically beyond what their organization can muster internally in terms of people resources.

The communist bent is almost what I would call artistic in the sense that open source programmers almost feel compelled to produce a magnum opus. If others recognize their efforts, so much the better. If they get a lot of money for their effort, great. But, like artists in other sectors such as painting, sculpture, poetry, music, acting, and mathematics, most programmers of open source software are not going to become as famous as for their work as Linus Torvalds or Richard Stallman have for theirs.

I think many, if not most, open source projects are worked upon by people pursuing something that interests them, which may or may not bear directly on their main occupation or business. Like many musicians or actors, they have a "day job" to pay the bills.

It will be very interesting to see how increased usage of open source software in the corporate world feeds back into development. The existing base foundation is considerable, a very attractive framework on which to build a high quality and low cost software solution to many a difficult business problem. How many of the ranks of corporate IT citizens catch the fever to contribute further to building the community's assetts will be interesting to see. That "fever", to produce something useful, is what will drive the success of open source software to ever greater levels.

Re:Economics of Open Source

[Bouncings]

All true, but there is some convergence of the two, not just in Open Source, but in general. Many Open Source projects were started both because someone wanted to write the program, and they thought there was economic benefit. TheKompany.com is an example of that. (No, not all their products are Open Source anymore.).

In truth, it goes beyond Open Source. GE exists because Thomas Eddison had an itch to make a light bulb. An Internet-company example, Yahoo, exists because some students wanted a directory of web sites.

The question is, would Eddison have made the light bulb if there was no economic benefit? Maybe, maybe not. Will - say - Larry Wall still be working on Perl even if O'Rielly fires him? Probably, and that's common among free software programmers. It's the willingness to work for the software alone that shows us who the true geeks are. :) Maybe Ed would have made the light bulb anyway, I think we probably would have!

Re:Economics of Open Source

[Eccles]

Anyone who works for a company making their co-workers redundant will tell you that they have less and less time to devote to an outside project.

Wasn't one of the features of the dot-com boom that techies were working absurd hours in the hopes of stock option millions? Then again, I never worked those hours, and I suspect many not-coms didn't also; perhaps it's the pressure at not-coms that has changed.

Re:Economics of Open Source

[Bobzibub]

Much cooperation exists within capitalisim, and it is primarily within the confines of a company. The amount of cooperation vis competition or size of the companies in an economy is determined by the transaction costs companies face. (Coase, R., 1937, The Nature of the Firm......Everyone cites him. I will too!)

AOL-Time-Warner & Microsoft grow larger because their transaction costs shrink. We in the Open Source Movement cooperate, our transaction costs are very small (I can code, upload it to freshmeat and you can add/customize/whatever to it for nearly $0.00.)

In essense the Open Source movement is quite similar to a large corporate conglomerate. We are large, international in scope, we cooperate with each other, but we for the most part sell products at cost-- which is free. We are also in competition with other companies despite not being profit motivated.

The companies mentioned in the article can be thought of as "partnerships" with the OS conglomerate (sorry, "Movement.") Their OS partner is being dumped due to our negligable margins, but the Open Source Movement is still strong. We code for free and as you say, we'll always have customers because we undercut our competition.

We're *not* that different than the AOL's, in an economic sense. We're definately "corner solution," however.

Re:Economics of Open Source

[mosch]

And there's another one that you've managed to ignore completely, despite it's huge presence.

Companies that pay employees to debug and add features to open source software, because they don't feel the need to reinvent the wheel just because they want two features that aren't in the original program.

Re:Economics of Open Source

[Anonymous Coward]

That willingness to work for software alone is also why "open source" programmers are the first fired when money needs to be saved. Why pay someone to do what they would do for free?

Re:Economics of Open Source

[MrResistor]

There is also the motivation of gaining community recognition.

More than just community recognition, also professional recognition.

Until about 2 years ago I was strictly a hardware guy. I got into electronics when I was in highschool, and I focused on electronics my first 3 semesters of college, figuring I could get a tech job and use that to pay for my engineering degree. Yeah, right! Everywhere I went I got the same responses: "We're looking for someone with at least 5 years of experience in our highly specialized field" and "It doesn't matter what you know because we do things differently here". Don't ask me what they meant by "different", I could never get a straight answer about that. Almost 10 years later I still haven't run into any hardware that doesn't obey the basic laws of electronics.

Anyway, the real problem was not so much idiot managers who believed their hardware is fundamentaly different from anyone elses, as how to get experience if you can't get a job. It didn't matter that I spent a large portion of my spare time fixing stereos and VCRs and trying to turn my old 8088 into a digital sampler, I hadn't proved myself in a professional capacity.

I think Open Source gives programmers a way to demonstrate their skills in a verifiable way. You can say, "Look, here is a package that people actually use, and here are my contributions to it." That can be invaluable to someone trying to get a foot in the door, something that is going to get increasingly more difficult in the current economy.

Re:Economics of Open Source

[AtariDatacenter]

It is really hard to say, and I can see that both factors are at work (less busy geeks working on open source, and the economic slowdown as a whole). What would be really interesting is if a geek were to put together a mathemtical model of the open source ecosystem. Now that would be a thesis project I'd like to see!

BTW: This message will test a moderation undo bug.

Re:Economics of Open Source

[wytcld]

There are two fundamentally different approaches to Open Source: capitalistic and communal.

Are the capitalistic and communal fundamentally different, or aspects of a common creature? Consider our current 'capitalist' president. How did he get there? By being a part of three groups - the Yale-Harvard axis, the Texas-oil axis, and the Connecticut old-money WASP contingent - which look out for their communal interests. Those with wealth and power in our society generally get there by being communal with some significant group of their counterparts. It's how the capital is accumulated to allow for capitalism in the first place.

So the question for those of us in the computer trades is whether we can achieve a quality of communalism among ourselves that will make us a true center of economic and political power. In the 90s we were getting there, centered largely on new West Coast elites. Wall Street was threatened by this, so it blew it into a bubble in order to (1) take East Coast profits on it and (2) make it go away.

If we quit being communalist now we're being penny wise and pound foolish. Do we want real power down the line, or do we want to be the sadder sort of "honest tradesmen" who have to rent their basic tools before they go out to the jobsite?

Remember, capitalism isn't about being some mean-ass son-of-a-hound to all and sundry, capitalism is about accumulating capital. Tools are a form of capital, productive of future earnings. Sharing capital within your communal group is the proven method by which Bush gained shares in several oil companies and a baseball team. And it's why he will be so good at paying back his friends - these values run deep enough in his character that his friends were comfortable sharing their monetary piles with his campaign.

The bottom line is that computers can do tremendously productive work. Those who can make the computers do that work can always get a cut of it. We individually have more capital if our tools are better - and the more we can share this capital as a group, the more politically and economically powerful we become.

In the old European empires knowledge of trade routes was capital, to be merged with the monetary capital of those who'd - largely out of pursuing the communal interests of their class - collected and preserved it. In the new empires knowledge of computer routing is capital....

Re:Economics of Open Source

[ab315]

GE exists because Edison got patents on the light bulb (or whatever). If he hadn't got patents he probably would have died in poverty.

Re:Economics of Open Source

[Anonymous Coward]

Edison's most influencial invention was the modern Research and Development laboratory.

Re:Economics of Open Source

[Arandir]

On the other side represented by the communal approach, participating in open source projects provides intangible or non-monetary benefits.

So how do I put Turkey on the table this Thursday using only intangible or non-monetary benefits? If there's nothing to sell then nobody will be giving you money in exchange for it. You might as well take up RMS on his advice and be a waiter and write code on weekends.

Open Source makes an awesome avocation, but I see very few people making a successful vocation out of it. Certainly some do, but they are the exceptions.

Re:Economics of Open Source

[scoove]

maybe my objectivist inclinations are showing, but i really don't like the classification of open source into capitalist and communal.

In fact, what you describe as capitalist (giving software away for cheap/free by making money on the service) is what the market would refer to as pure-play. ALL you do is open source with its revenue hook, be it support, packaging, advertising, whatever. (Pure play open source is counterintuitive by definition because you really can't have a pure play that has a price of $0 - something else has to be the focus).

The alternate model, as long as we're looking at open source as something more than a hobby (my bias, but the article discussed doesn't address hobby programming), is open source as complimentary technology to a business that achieves its revenue from another focus, e.g. manufacturing, telecom, etc.

Like I mentioned, there is a problem classifying any open source effort as pure play. Technically Redhat and other 'pure plays' are actually service businesses with open source as the complimentary technology - and service or support may or may not be the right focus for them.

So shouldn't our discussion focus on what primary focuses work well with open source as a complimentary technology - apparently service/support doesn't work well all the time. Advertising seems to work none of the time (my bias). Since open source = $0 at the cash register for the code itself, there /has/ to be something else to pay the bills.

Understand that for many of us, open source is intelligence we share with other smaller companies to fight the evil incumbants in our industry. Like Afghani expelling Soviet occupation, we'll share weapons, intelligence, whatever to beat them out. It's a competitive advantage.

If we're wise, we'll be happy with our own territories when we've succeeded, since it is unlikely we'll be able to defeat each other without weakening our home turf.

And open source even has a value for the big boys. Release open source that destroys a competitor's pure play proprietary software focus (e.g. StarOffice or other hardware vendors trying to knife Microsoft attempts). Release open source that creates a demand for your product (e.g. AT&T research doing VNC, which chews up a lot more bandwidth and requires faster links). Release open source that makes your technology more usable.

*scoove*

Re:Economics of Open Source

[sheldon]

Actually you are onto something that I've been thinking about for quite a few years.

I agree that success is a communal thing. You succeed a lot by who you know and how to leverage that. If you've ever worked in a financial firm, you'd see an interesting phenomena amongst stock analysts, researchers, etc. They are all family members, friends, or they know someone that knows someone. It is very communal, obviously.

However, I don't agree with the conspiracy theory. I do think Wall Street is threatened by a technologist communal society, but not in the way you think. They're threatened by it because it may mean IT staff can demand salaries comparable to other areas.

I don't believe that Wall Street sabotaged anything. The Bubble existed not because of Wall Street but because of a bunch of schmucks looking for get rich quick. They weren't financial geniuses, they weren't geeks, they were schmucks. If you were paying attention, all the top financial people in the country were warning about the bubble. Greenspan, Buffet, etc. Even Ballmer warned against it.

You don't get rich off a bubble, or over inflating stock values. That happened when the schmucks tried to take over the knowledge of the geeks and get rich quick. Doesn't happen, won't happen. It takes long hard work, like Microsoft, like Dell, etc.

But still, I like your idea. I like the idea of making sure that people in IT further the communal society by looking out for one another.

But I don't see it happening. There seems to be this tendency of geeks to cut each other down. I guess I look at people like Richard Stallman as a prime example of this. When people left the MIT AI lab to take their ideas and capitalize on them, what did he do? He worked to sabotage them and what they were doing. The whole FSF is based largely in part on sabotaging the ability of some geeks in this world to capitalize on their knowledge.

Anyway, I think you have come to an interesting conclusion. I like that, and I think it should be a goal of ours. But one of the keys to success really is not sabotaging others or believing in conspiracy theories, but learning how to work with them to get what you want.

If you were smart, you could have used those schmucks with the internet bubble to your own gain. Unfortunately I wasn't smart enough. :)

That's the secret behind successful companies like Microsoft. It's not an evil empire, it's not a conspiracy. Their goal is to partner up with people in order to attain what they want. If both sides get what they want, it's called a successful business relationship.

Its not Mismanagement, its Open Source's Fault

[1alpha7]

Tiemann, who was head of the open-source programming tool company Cygnus before Red Hat acquired it, warned that moving to a proprietary model is no miracle cure. A faltering open-source company shouldn't expect instant revenue by closing the source code in the next edition--an approach Cygnus tried but abandoned.

Hey, if you have almost no business model, and your whole business plan fits on half a sheet of paper, it turns out that neither open source, nor closed source is a magic pill of salvation. Who'da guessed that. Darn, this entrepreneur thing is hard

1Alpha7

we don't need no stinking money

[Frothy Walrus]

the economic slump is hitting the entire country. of course the techies are getting the worst of it, what with the dot-com mass hallucination having ended. but singling out the Open Source movement seems a bit unfair, if not irrelevant:

we wrote free software before the companies were organized; we'll keep writing it even as they're about to close shop.

Economic slump?

[NineNine]

Well if all of the OSS companies switching to closed source, or shutting down completely (except for one) can be callled an "Economic Slump", then I guess the current state of the US economy by comparison is a rip-roaring success!

Really. OSS is not in an economic slump. It doesn't work as a software develpoment or even a support business. Period. Never has, never will. For some reasons, OSS companies skipped the "Business Plan" part of starting their business, and are only now starting to run out fo money.

Don't blame the economy and walk away

[rmadmin]

Don't blame the economy and walk away. The economy ha been shit before. And Sept 11th really sucked. But god damnit, don't think that just cuz times are tough people are gonna give up. My mom worked for a company for 24 years, made it up to production supervisor of the entire plant. Two months ago her possition was eliminated. Sure.. lets blame it on the economy when theirs 2 guys that have been at the plant for 2 years, both are making 80K a year, and don't know a god damned thing about the company. My point being. I think alot of companies out there are doing stupid shit they dont' _have_ to do, they wanted to do it. And this gives them a good excuse to do it while its still wrong.

Re:Don't blame the economy and walk away

[Anonymous Coward]

Saying 'they don't know a damn thing about the company' could be simply saying 'they're not dead wood'. The economy changes. Markets change. There's a natural 'filtering' process by which the best employees move on eventually, leaving behind the people with 'roots' of various sorts in the company. The person whose experience is deep but narrow isn't automatically qualified to hold the job forever.

Reality sucks sometimes. Move on.

I can see it...

[Junta]

At least open source in the Linux realm. During the economic boon, many businesses had so much money and resources, they could afford to effectively throw money away on open source, in the hopes that eventually it would provide opportunities to combat MS. But now the companies that are left are more wary of expenditures. As much as I hate to say it, commercial contributions contributed a great deal to open source, and now that is mostly gone.
Also, some companies that gave employees a lot of free paid time have gone under, giving a lot of people a lot less time to work on their hobby projects, since they had to find a job at a more demanding, efficient place (my personal experience).
Direct commercial support is withdrawing, and inadvertant support by companies that were slack is dwindling. Fortunately, there is still momentum and Linux is thankfully more well-known now, so things won't stop, but they won't go nearly so quickly as they have the past couple of years.

Re:I can see it...

[Anonymous Coward]

People also forget, and it's cold dead reality, that Microsoft excels only when they have a strong competitor barbing them on.

They didn't do squat for the WWW until that pipsqueal from Netscape (the guy who misspells his name 'Marc' I think) got all puffed up and said 'we will take over the destkop.'

They needed the Open Sores folks to start threatening them in the OS field with reliability to get Windows 2000 out.

Sorry, but 'David and Goliath' is a parable, not oral history.

Linux, for example

[k98sven]

..started during the early nineties, during which Finland was in it's deepest depression since the '30s. Didn't stop Linus. And it won't stop scores of other hobby OSS developers either.

However, less corperate funding may retard development, but hey: in a recession everything else slows down too.

Re:Linux, for example

[infinite8s]

Linus was also in university at the time, and we all know that university students have lots of time on their hands, and also not having to worry about the current economic climate.

Re:Linux, for example

[Anonymous Coward]

Also, we aren't necessarily in a recession.

Sure, a bunch of propellerheads who thought they could surf their way to riches on the WhirledWideWeb have foundered, and their carping and whining may be having a negative impact (effective they are rocking the boat, what little pigs they are...) but the economy is fundamentally sound.

Bad times => less time

[dspeyer]

Even assuming that hobbiests are the driving force behing free/open-source software, which I think we are, the economic downturn could still seriously hinder our software developement.

Consider how many tech-workers had dependable jobs which didn't demand all their energy (i.e. left them awake enough to hack when they got home, maybe even let them code unrelated stuff on the job if there was nothing urgent that needed doing). Those positions are growing fewer, and many who considered OSS their real life and what they did at work a side-issue are being forced to switch that around. This could cost us a lot of available labor.

Of course, I could be totally wrong, but maybe something resembling what I said is right.


Violence is the last refuge of the incompetent.

Open-source is parasitic

[Eloquence]

Currently, open source is used by many people who never give anything back, although they would be able to financially support development. The reason for this is not that people are malicious or exploitative, but simply that it's not convenient enough. Some sites have small "donate" buttons, but these give little feedback (a la Penny Arcade, only more detailed) and do not allow subscriptions or feature requests. The best implementation I've seen so far is Freenet, except that people only donate when they have a reason to visit the frontpage, which is not updated very frequently.

A sophisticated donation/subscription/feature request system which automatically suppports several payment methods should really be part of a collaborative development site like SourceForge. For using Amazon's Honor-System, which is very feature-poor, 15% of any donation go to Amazon. This would be an adequate level for something like SourceForge, and here people would gladly pay the 15% because they would know that they support important infrastructure. I really can't understand why SourceForge isn't trying anything of the sort, but I haven't noticed much innovation in their business strategy anyway.

Of course, in the long term, I'd love to see a standardized electronic payment client (with a Qt or GTK interface) which supports subscription management bundled with all Linux distributions. Then you could easily pay with a single click in your browser.

Re:Open-source is parasitic

[NineNine]

A subscription? You mean like Windows XP? You can't be serious.

Re:Open-source is parasitic

[Eloquence]

No, what I mean is really a system for regular donations without (many) additional privileges. Subscribers could get some benefits, like free e-mail support or access to the wishlist.

Another area where subscriptions can be useful is in a Street Performer Protocol like context, e.g. Transgaming, where the code is GPL'd when a sufficient number of subscribers is reached.

Re:Open-source is parasitic

[zulux]

Even the parasites give back:

A parasitic open-source user gives back to the community though the network effect. One more Linux user, no matter how parasitic, is on less user of proprietary software with proprietary protocols - and that person will help persuade others to join.

Re:Open-source is parasitic

[Mister Black]

I've been trying to work out a feasible open source donationware system along those lines. It would go along the lines of:
Programmer A sees a need for program X. He puts up his site on sourceforge saying "this is what X will do, blah blah features,etc etc." People who think that this would benefit them could throw in a dollar or two which would go to the programmer and help pay for his time/bandwidth/food/clothes/a bath/whatever. The source remains open, the programmer gets some money, everybody wins.
Bigger, more daring programs that require a more people could put forth a budget and a timeline and request money to fund their project.

You still get some free loaders but it still gives the opportunity for some opensourcers to literaly put their money where their mouth is. It's like a distributed benefactor system. A big problem to overcome is that damn 15% commission that Amazon charges. If something like this ever took hold I'd be willing to help out and take a smaller commision of 5-10% - like an opensource paypal.

I'm going to go climb back into my bottle now.

Re:Open-source is parasitic

[Anonymous Coward]

Donations do not work. It is not a matter of convenience. This is well known from the shareware community. Ask ANY shareware author. The shareware community has been going a lot longer than the free software community and they have tried out every "easy-pay" strategy and know what works and what doesn't. The only thing that works (i.e. brings in money) is a time-limited version of the software which must be registered after 30 days or the application won't run.

To actually get donations you have to create moral pressure, which is unpleasant for both sides. Remember that most people routinely pirate commercial software, and don't care about blatantly breaking the law, let alone remunerating the author. Piracy is a serious crime, and businesses can be get a hefty fine for running unlicensed software. Nobody willingly pays, let alone donates without significant moral pressure, except in amounts so small that it is not worth the hassle. Ever see people begging in the street? That's the lifestyle you get from donations where there is a huge amount of moral pressure ("Hungry and homeless, will work for food, please help me"). Sure maybe a developer can get $10 or maybe $100, which might be useful for a student, but it's not really relevant for a professional developer w mortgage/family. Free sofware is "cool" but as someone once said "if I could pay my bills with 'cool' I would be well-set".

I don't want to be cruel here but people are basically selfish most of the time, and do not think about donating. You can give them paypal, fancy GTK applications, or stand in the street with a collecting box asking for money but people will try to avoid giving. After all, millions of people around the world are starving to death, or dying of easily curable diseases while we read slashdot, we know this, we have seen it on TV, but statistically speaking most of us (including me) don't donate much money to organisations that work to solve the problem. There's always an excuse. "Sorry I don't have any change", "How do I know the money won't be wasted?" , etc.

I am a free software developer, quite a lot of people use my software, and it is easy to donate money to me via paypal or ask me to make an enhancement for money, or hire me. I explicitly say this on my webpage. Nobody ever has, and I don't really expect them to. Most of the emails I get are complaints about something not working the way someone expects (usually because they haven't read the manual), or comments that underestimate the amount of work I put into the project, like "This package would have been much better if you had written it in <my favorite language&gt". Sometimes I get some emails that say "Great program!" but that's about it and that's all anyone can realistically expect. Maybe I did too good a job and made the software too reliable ;-)

I didn't have any illusions about this before I started writing the software, and my experience has confirmed what I expected. The only reward you can expect from writing free software is the satisfaction of seeing it being used, sometimes by people who don't know that they're using it, or simply knowing that you did a good job.

If you actually wanted to get donations you would have to start pressuring people who use software but don't donate, for example by implying they were "parasites" or calling them that, etc. This is exactly what happened in communist countries where people were supposed to donate their labour to society for the good of all. I don't really think it's a good idea to introduce it into free software, even if there is some truth in it.

I'm being an A/C because I don't think the specifics matter here.

Re:Open-source is parasitic

[Anonymous Coward]

it takes a sh*tload of 'network effect' to match one $70 shareware registration fee.

Re:Open-source is parasitic

[Eloquence]

Hi,

you raise some valid points, although it should be obvious that I disagree. However, instead of citing in detail some of the examples that refute your arguments (including many successful shareware apps), I will try to actually create an open data-pool on this very subject. If you are interested in the results, you can email me at moeller@SPAGHETTIOSscireview.de, after removing a full serving of veggies and grains.

Re:Open-source is parasitic

[Arandir]

Okay, so you now have one million non-paying customers versus one thousand non-paying customers. I would rather have the latter because I am making the same amount of money with a fraction of the support headache.

Re:Open-source is parasitic

[Arandir]

I am a free software developer, quite a lot of people use my software, and it is easy to donate money to me via paypal or ask me to make an enhancement for money, or hire me. I explicitly say this on my webpage. Nobody ever has, and I don't really expect them to.

I hear you! I have a home brewing program that is quite popular in it's admittedly limited market. My documentation clearly says that monetary payment is not required, but that donations of homebrew (or even pictures of homebrew) created with the program will spur further development. To date I have received one bottle of homebrew and one picture of homebrew. If I was counting on monetary renumeration to pay my rent I would be living under the nearest overpass.

That said, I am not doing this as a way to make a living. I'm not stupid. This is my hobby. I have received code contributions and many thank you notes. This all makes it worthwhile.

Re:Open-source is parasitic

[Anonymous Coward]

Although I flamed out there I actually agree with you that a convenient donation system would be desirable, on the principle that people should be given the opportunity to "do the right thing", even if they choose not to. The convenience on its own would not work in my opinion, although it is necessary.

What it would need to drive it and actually be successful is for a reputable organization to get behind it and exert the moral pressure, rather than individuals. I believe this is more civilised and acceptable to all sides. For example, if FSF, RMS, Alan Cox, Redhat or whoever said "if you use free software and don't make any other financial contribution you should contribute $1 per month to this system to support developers of the packages that you use the most. We expect you to do this and we won't consider you to be a part of the free software community if you don't support people working on free software". I'm imagining people signup with their credit card and that they can select a "portfolio" of projects that they want to support with their dollar each month, e.g. emacs 10c, gcc 10c, gimp 20c, apache 15c, etc.

I personally find it too embarrassing to directly say to users of my software "please donate $10 to me if you use the software... I actually need the money", even though I do actually need the money to some extent (I'm not starving, but I do have some financial troubles and it would save me working a second part-time job).

Re:Open-source is parasitic

[depeche]

I don't like the idea that economic renumeration should take the form of micropayments in the OSS model, let alone the FSF model. Fundementally, OSS is about colaberation and the contribution of time and energy to a project. The problem that occurs when people use OSS and don't return to the project is not that they cannot find a way to make payments (which only makes sense if you are attempting to tie the traditional Capitalist structures onto a concept which does not conform to them). The problem is that they don't necessarily contribute to the pool of resources and energy that the community needs to thrive.

The FS (e.g. FSF) movement is even farther from needing payments. Afterall the notion of Free as in Speech is that the work is simple a presentation to the world and our global knowledge. The ideas that are contained in FS are supposed to be given away. The protections in the copyleft are intended to keep them that way. Now there is an implicit assumption that this system works becuase everbody chooses to participate in our global comminity. But I don't have to share my ideas with anyone if I don't want to. The difference is obligation.

As the article mentioned the problem currently is not with the OSS movement but with the companies which are trying to make money through it. The real problem as I see it is not getting payments into the OSS system, but getting companies to understand that the correct response to OSS is the return of energy, resources, and knowledge to the community.

Here is an example of how this could work:
A large organization like the Mexico City or City of Largo (also) and, possibly, City of Turku, Finland (Finnish) can contribute by hiring programmers for to work on the projects which they are using (and relying on). The number of programmers should be proportional to the needs of the organization and the savings from the conventional CSS model. If, for example the savings over a conventional solution over 2 years was $500,000, then the organization could spend $200,000 on programmers to both solve problems that the organization needs resolved (and which would be contributed back to OSS) and additionally provide 50% of their time to contribute to the OSS projects they are relying on (bug fixes, improvements, research). All numbers are merely examples. You get the idea.

A smaller organization could contibute some of the time of its staff and provide some resource (server, hardware donations, software donations, etc.) I am working with many clients who are just beginning to understand how FS/OSS may fit into thier business models. Give them time and help them to understand that correct response to the benefits of using FS/OSS is direct contributions to the community and our world.

But, this doesn't fit into the 'Modern Western World View.' Modern (American) capitalism is a beast whose fundemental tenents no longer bare any resemblance to reality. Informed consumers are not only idealized, but necessarily fictional because there is too much information for any consumer to possibly be informed on all their desicsions. This is what keeps product, techniques and services which are sub-optimal or even harmful (or at the very least no good) in the market. Other forces besides supply and demand control the system: Monopolies, Ologopolies, price fixing, political manipulation through PACs, financial contributions, etc.

Clearly, the relationships between those inside OSS community and those on the outside who adopt OSS can be changed by showing the adoptors that the correct adoption of OSS is not merely the use of the code, but involvement in the community--and by doing this, the question of renumeration becomes irrelevant.

Re:Open-source is parasitic

[praxim]

Aye, mod this up, this be insightful. (Arr.)

Re:Open-source is parasitic

[cduffy]

I work for an open source company. Let's say we have 200 other companies as clients. Those 200 clients wouldn't be happy with the software they purchase if not for the hundreds of thousands of folks who use it for free and contribute to its development.

If you're doing all the development and support yourself, then maybe you've a point. If your organization exists to support customers who are using a 3rd-party product (in our case, customers who are using it in a very specialized way), then every extra user is a benefit, paying or no.

(Even the projects we lead benefit from 3rd-party involvement; we couldn't support nearly the amount of software we do were it not for community involvement).

The Business of Open Source Software

[Vic]

This may be a good moment to plug an event occurring this Sunday, November 25th.

The Business of Open Source Software is an event being held by the Ottawa Canada Linux Users Group (OCLUG). We have Eric S. Raymond giving a keynote speech, followed by a panel discussion of members of various open-source related companies (Xandros, IBM, Roaring Penguin, Steamballoon, OEone, and Open Source Development Labs).

Click the links for more info. It promises to be a very interesting event.

Cheers,
Vic

Java does not have these problems

[Anonymous Coward]

Open source cannot survive without large corporate sponsorship - witness Sun and Java. Java is developed by the community. Every dollar you spend on Java lines Scott McNeally's pockets. He likes his open source Java, perhaps you should too.

Are the hobbyists really driving open source?

[Junks Jerzey]

Sure, there are some smaller and lesser known open source programs out there. Heck, lots of little solitaire games and remakes of Breakout (Arkanoid, for you young 'uns) are released under the GPL. But those are not the programs that give open source it's high profile. We're talking about:

1. Perl & Python
2. Apache
3. the Linux kernel
4. gcc
5. KDE
6. X

There are certainly commercial interests behind most of these, in that some people--not all--have full time jobs working on them. gcc especially wouldn't be anywhere near where it is today without the input of a number of large companies.

Re:Are the hobbyists really driving open source?

[Eloquence]

I think it is unfair to characterize open-source development as primarily driven by companies. After all, the projects you mention started as open-source projects without much or any commercial support. It was only when corporations recognized the benefit this software would give them that they jumped on the bandwagon. So what we see here is really a hybrid economy, where everyone who benefits from a certain piece of software, which is effectively in the public domain, has a self-interest to contribute to its improvement, either with money or with code. As I stated in my other comment, I'm afraid especially the "contribute with money" part is currently underdeveloped.

Re:Are the hobbyists really driving open source?

[Anonymous Coward]

And you don't mention any BSDs?

Re:Are the hobbyists really driving open source?

[MisterMo]

This is right - much open source activity is effectively a subsidized development model. The companies get more out of collectivizing their software development than they lose by not "owning" the result.

I'm always surprised that more people don't view it in this way...

Re:Are the hobbyists really driving open source?

[swb]

They probably do view it that way, but a lot of places would rather reap rewards with zero input, which has always been the bugaboo of open source development or any other "from each, to each" kind of economic model.

If every shop with more than 20 programmers donated 1 FTE of programming time to some centralized open source collective, I would imagine that the rewards might be magnitudes beyond what they gave. The question would be how would their time get assigned and who would manage it, both massive political questions.

Re:Are the hobbyists really driving open source?

[Anonymous Coward]

Not true. My husband is the Perl pumpking who works for free every night and weekend. Noone is paying him so much as a copper penny.

ORA and ActiveState have, on rare occasion, helped fund certain features when it was clear there was no other way to get it done but as far as core developers go, 99.99% of it is done by volunteers who never see a dime from their efforts.

Don't spread ignorance as if it were fact.

This is backwards...

[FortKnox]

Because a lot of people are getting laid off their jobs, I'd expect Open Source to skyrocket. When the very few jobs actually start hiring, they'll want people that kept busy, and aren't going rusty. Not to mention you can show you're great coding style on open source projects (ie - during the interview, say "yeah, I wrote anim.h & anim.cpp, please open them up on the website and see how I animated this spline using the super-quick algorithm").

If you unemployed are smart, you'd log off of slashdot, and get your coding groove on.

Re:This is backwards...

[NineNine]

Actually, no. If you don't have any money coming in, you spend ALL of your time trying to land something that pays. Programming for free is the LAST thing on your mind when you're unemployed.

Re:This is backwards...

[mattbelcher]

I got my latest job using that exact strategy. I put together an open source web logging app (Lumberjack) and that certainly helped me get this job. Without that, I was just another recent graduate with no "real" experience.

Re:This is backwards...

[FortKnox]

If you don't have any money coming in, you spend ALL of your time trying to land something that pays

Programming for free is a way to land a job that pays. Like I said before, it impresses the employer. Look at most tips on getting into the gaming industry. They always say, they only accept coders that code because they like to. They want to see what you code -outside- of work. Open Source is an advantage in this manner.

Put yourself in the position of a recruiter. Here's a guy that's been unemployed for 3 months, that's been working at McDonalds to get by, but he's got a portfolio of coding from an open source project he's been working on; versus a person that's been sliding by making web pages. Who you gonna hire??

Re:This is backwards...

[phutureboy]

Actually, no. If you don't have any money coming in, you spend ALL of your time trying to land something that pays. Programming for free is the LAST thing on your mind when you're unemployed.

I can attest to this :)

Re:This is backwards...

[NineNine]

Actually, talk to a recruiter. They don't want to see big non-industry related gaps in your resume. Actually, they'd prefer if you got by making web pages.

Re:This is backwards...

[beth_linker]

Seriously. Besides, if you're living in a major American city then "working at McDonald's to get by" probably isn't a realistic option because a minimum-wage job won't cover rent.

Which is not to say that open-source coding is a bad idea. Especially when the pickings are slim and it could take months to find a new job, working on your skills while you job-hunt is a good idea. If I get laid off, I'll use some of my free time to pursue Java certification. Working on an open source project might be another option, as would volunteering to do some free/cheap tech work for a local non-profit.

But having a real impact on an open-source project would seem to require more of a commitment than a few weeks of downtime while between jobs. Realistically, the only projects that do well are the ones where people invest serious effort on a long-term basis.

Re:This is backwards...

[Syberghost]

It's not surprising that you think this. It's a common naive misconception in the Free Software community.

Understand, people; programmers work on Open Source either because they're paid to by a company that can benefit from it, or because they're scratching an itch. You don't have time to scratch an itch if there's not food on the table, and most programmers (and I mean the vast, vast majority, probably in excess of 90%) put food on the table by writing CLOSED SOFTWARE internally for corporations.

When reality doesn't agree with your preconceived notions, the smart thing to do isn't attempt to deny the reality; the smart thing to do is examine your preconceptions.

Re:This is backwards...

[Chris Parrinello]

As somebody else who was unemployed recently during this "downturn", my experience with the recruiters is that they'll hire the person that has the most skills that match exactly what they need (down to the the application server and IDE tools). If your skills don't match what they're looking for, they're not going to hire you just because you like to code. That's just the simple reality of the job market right now. Maybe in a year or two things might be different.

Your statement about working at McDonalds to get by is cute. I can make more collecting unemployment insurance than working at McDonalds. And while you're working at McDonalds, when are you supposed to find time to go on interviews, send out resumes (I sent out 50 resumes in the span of two months) and work on an open source project?

Re:This is backwards...

[sporty]

Being of the unemployed status, not having a job, being a bum until my next job is found all i have time to do is read, program, play v-ball and what not. Its not because I'm not looking, its because the first week, I did most of what I could and now doing incremental searches, following up and what not, takes 2 hours a day. At least now, with this OSS, I can show employers that I do have the potential with another project I'm working on.

I'll give myself another month or two before I take any job I can find..

Re:This is backwards...

[yog]

Typical putdown of McDonalds that isn't borne out by the facts. A quick search at http://www.monster.com reveals that shift workers in Dallas are being recruited for $7-$9/hour. Management positions are $25,500.00 to $37,500.00 per year. It's not very much compared to computer programming, perhaps, but it's not minimum wage either. I wonder if there's a McDonald's anywhere in the U.S. that actually pays minimum wage.

Re:This is backwards...

[mnf999]

They don't want to see big non-industry related gaps in your resume

I beg to differ. One of our contributors in JBoss landed a high profile job, not because he was wasting time in cubeland but because he used his sinking company time to work on JBoss while at work. The competition on his job was fierce the guys picked the one who coded for the "love of coding".

the point that was made was that a Open Source track record shows you LOVE coding, you do it for free. Beware of impostors now but the point is clear

Re:This is backwards...

[mrcparker]

I don't know about that. Because the market has gotten so crappy I have signed up for a few projects. I need more on my resume that I can show potential employers if anything happens.

I don't know about you, but I am trying to cover my ass.

Re:This is backwards...

[rbeattie]

I disagree.

One of the things I'm doing to promote myself as I'm looking for new work is working on an open source project that I can use as an example of my technical ability.

It's fun, teaches me a lot, and is better than a resume in showing what I can do and will hopefully land me a cool job.

-Russ

Re:This is backwards...

[ChrisWong]

This might result in a bunch of little solo projects (so the interviewer does not have to sort out who wrote which part). I am not convinced that this will benefit the large flagship projects that need significant ramp-up times. "Yeah, I submitted a patch to fix a bug in htmlentity.cpp in [mega humongous web browser project]" does not have much show-off value.

On the other hand, these flagship projects have fulltime programmers hired to work full-time on them. Red Hat hires kernel hackers, for example, and Mandrake hires KDE developers. Apache, PostgreSQL, Ghostscript, MySQL, Mozilla/Netscape and Gnome also have full-time developers. The landscape has changed: when corporate dollars are thrown at the open source world, projects gain momentum at the cost of dependence on paid work. So when full-time developers get laid off (like with some PostgreSQL folks recently), they may find themselves taking a paying job that has nothing to do with their old projects. Demoting full-time developers to your-free-time-only status will negatively impact any project.

Re:This is backwards...

[Salamander]

One of our contributors in JBoss landed a high profile job, not because he was wasting time in cubeland but because he used his sinking company time to work on JBoss while at work...
...a Open Source track record shows you LOVE coding, you do it for free

But the guy in your example didn't do it for free. He stole time and resources from a prior employer to "do his own thing" and for that reason I would never hire him. If people want to work on open source on their own time fine, in many ways I agree that work on open-source software is a better indication of someone's true capabilities than what they do in a constrained corporate environment, but that's not what we're talking about here. Once a thief, always a thief. If someone wants to have their voice heard in determining what work we do that's fine, but I can't afford to have people working for me who will get bored and start working on personal projects behind my back instead of working toward our supposedly-shared goals.

Re:This is backwards...

[charon_on_acheron]

I think a large part of the perception of this line of thought is whether the person has a wife and kids. A single person with no kids and few expenses other than food and rent is more able to struggle thru an unemployed time. Or working at a low earning job to cover the basics while waiting to a good job to appear. He can also write code when he wants at home, doesn't have to have 'quality time' with the family.

A married guy on the other hand, needs a decent paycheck to keep the wife happy. And with kids thrown in, you have to buy more food and clothes too. So he needs a real job as soon as possible, whether it's in IT or not, and spends his time at home with the family, doing what they want.

Been there, done that.

And for the women or political-correctness nazis, yes I used a male for both examples, and yes I realize female workers are affected too, probably even more so because of the male chauvenism in the business world. But I will still use the male-oriented examples, because that is the culture. And as for the "decent paycheck to keep the wife happy" comment, it's true, don't deny it. If a married guy has a low paying job, such as flipping burgers, the wife is very unlikely to be happy when he brings home the paycheck. That too is part of the culture we live in.

Re:This is backwards...

[Anonymous Coward]

You don't have time to scratch an itch if there's not food on the table, and most programmers (and I mean the vast, vast majority, probably in excess of 90%) put food on the table by writing CLOSED SOFTWARE internally for corporations.

The vast majority of programmers work writing software internally for corporations, sure. Whether that software is "open" or "closed" is academic; the company gets the binary and the source, they can do whatever they like with them. Whether it's given to them "closed" or "open" means nothing, if they want to redistribute it they can, if they don't they don't have to (most won't of course). How is this different if the software is "closed"?

Services and Support

[SirSlud]

The OS community has learned that S&S doth not a profit make. But the universal conclusion seems to be that OS can't be profitable (after all, what else is there?)

Photoshop users know exactly how OS can be profitable. Corperate clients pay. Personal users do not. Since we all go to work, there should be at least some level of support from the corperate community. When we go home, it's free.

Xerox, laptops ... there are many products that work has paid for, that we, for all intents and purposes, get free personal use out of. Heck, Windows is like that (ie, so much personal pirating, MS gets most of its money from corperate clients.)

I think most people will disagree with me, but oh well.

Re:Services and Support

[Anonymous Coward]

Except that MS gets most of it's money from OEM'd computers. Very few large corporations directly invest in MS products. They get them from a 3rd party (eg. Dell, Compaq, Gateway, etc etc.). I'm not a big person in the industry, but I'd say that withholding the current slump in computer sales (market is saturated heavily), that personal users are still the biggest benefactor of MS. The big computer companies (I rekon, anyway) sell more PCs to personal users, than to big industry. I guess you would have to obtain statistics form these corps. directly to see what % of their market is, if even they would divuldge that information.

Maybe nothing to do with open source

[rnb]

I worked for a company for a while that was as proud of the fact that it was creating (some) open source software as I was. Then it went under. Not because open source wasn't working for them, but because management spent all of the investors' money on renting halls to have company wide meetings, throwing parties, "business trips" to various places, etc, etc, etc.

Just because a company is wise to open source doesn't mean they're wise to good business practices.

Before and after

[imrdkl]

Before: I work when I want, and I write free stuff, and slashdot, when I want, because they desperately need me for whatever work I am willing to produce. I am in charge during salary negotiations. I am the master of my destiny.

After: Now I have to cover for the consultants who've been sent packing, which means lots more MS documentation, and usage of lame IDE's. I take what whatever I can get in my "evaluation", and hide my slashdot window when somebody approaches in my nifty computer rear-view mirror that I got at the last conference I attended... a long, long time ago.

All in all, it's much more painful than I ever imagined. But hey, theres always the dotcom across the street... hey, wait, McDonalds?! Oh no!

Isn't this part of the problem.

[jvmatthe]

In the article about Microsoft doing well, MSNBC writes:

And its antitrust settlement with the Justice Department earlier this month is expected to free it to focus more fully on expanding beyond PC software.

Isn't that part of the problem? That is to say, are people so blind that they don't see that "expanding beyond PC software" mean (for Microsoft) that they will leverage their grip on the consumer PC desktop to gain advantages in new markets and shove out competitors [sic]? This line of the article says, to me, "the antitrust settlement effectively frees Microsoft to continue to violate antitrust laws".

Re:Isn't this part of the problem.

[Anonymous Coward]

say what you want, people are going to buy what they want. if windows looked like linux , people would not be buying it. (apparently they wouldn't even be using it for free). dismal sales of the x-box show ms really can't just waltz into any market and take it over, they need to provide quality first.

Re:Isn't this part of the problem.

[Anonymous Coward]

I like the American system.

I have money... With my money I get to decide what I want to buy.

Stop trying to be my parents. Especially since you don't know shit about what *I* want.

Answer

[Anonymous Coward]

Is open source truly being driven by those who make it their full-time occupation? If so, is there a happy medium for keeping bread on the table and still working within the open source community?"

Not really. Open source is more about doing what you like and according to this article, also your biological imperative.

Well, OSS is dying where I work

[mrcparker]

I am a developer who is in charge of around 5 Linux boxes at my company. We are a Unix house that has a Windows network and management has now told me that I need to take them down and replace them with Windows 2000 boxes due to the recession. Yea - bizarre logic, I know.

Sucks, because it will be the first time in around 6 months that I have had to even touch an of these boxes.

Re:Well, OSS is dying where I work

[ichimunki]

Well, are the machines being used with Linux? Will they be used more with Win2k? If installing a different OS means not having to buy new hardware it makes sense. But assuming the machines are already at normal capacity, yes, this decision makes no sense... unless they're planning to save money some other way.

Re:Well, OSS is dying where I work

[mrcparker]

Actually, no, no, and they will be replacing the machines with new machines completely - machines they have yet to buy.

They are not planning on saving money any other way by the use of these machines. Yea, I don't understand at all.

It makes sense to the people in charge, obviously. I have also been told that they do not like Apache and that they want all applications ported to Java. I am in hell.

Re:Well, OSS is dying where I work

[mnf999]

Wow that is the first time that I hear this... in fact it makes no sense and seems to be an odd-datapoint. I see exactly the opposite in all the accounts I work with, that people are really rushing to Open source to save some bucks, remember it is un-american to waste money.

So you will excuse me but you are working for a crazy man. and in the long run "free and good" is a great position to be.

Re:Well, OSS is dying where I work

[argoff]

Translation ... they've decided to consolidate all their opperations under windows and phase out the extra cost of UNIX gurus.

Analysis ... the manager is getting some kind of kickback from M$ and wants to get rid of the competition.

Um, no.

[NineNine]

Convenient that you link shows just the past two years. This is what shareholders REALLY think of Microsoft. Notice that even in this recession, you'd be up over 600% just in the last 5 years. You'd be up several thousand percent if you stretched it back further than that chart shows.

Any surprise?

[Otter]

"Where is our business model if everyone else can copy it?" asked Holger Dyroff, former CEO and now director of sales for Linux software seller SuSE. "The question is where we can make money now. Nobody cared about profitability two years ago."

The recession seems like a pretty weak excuse for everyone here to invoke. How good does the economy need to be get before profitability stops being a necessity?

The article (kind of a gumbo of random bits from the last month of LinuxToday) also jumbles together licensing (closed vs open/free) with community development, which is something entirely different. Where I burst out laughing was at:

One key motivation said to drive volunteers to open-source projects--the prospect of leaving a lasting mark on the software world--has shown its limits. "I'm tired of people who complain loudly when something doesn't work but fall silent when asked to help in fixing it," groused Christoph Phisterer in his resignation from leadership at the Fink project to bring open-source and Unix software to Mac OS X computers. "I once thought sharing my knowledge, experience and time with the community was a good thing, but now I know better."

Well, the guy wanted name recognition and he's certainly gotten it. Yeah, I think we can draw all sorts of sweeping conclusions about free software from the case of a single college student-run project...

Re:Any surprise?

[Anonymous Coward]

Yay! One less Mac OSX developer!

(Yeah, go ahead and waste your points on me, you one-button freak.)

cost of nothing?

[JDizzy]

What does nothing cost? Does nothing have a tangable asset value? What is the portfolio of nothing?

open source has always been a nothing type of bussiness. I'd say a small fraction of open source developers get contributions back from their user base in the form of donations, contributions, etc.. I'd say an even smaller a number of folks are on the pay-roll of a company paying them to work on open source. Think of this: IBM pays a guy to rip-off the linux kernel to make it work on the BIG-IRON machines. THis would be something that the company has a vested interest in. THese developers are the exception, not the rule.

I write open source sorftware, and do as a contribution to humanity. I hope I violate as many patents, and copyrights as I can allong the way. I do everything for free, with zero tangable gain, except for the intelectual prowes gainned from doing code. There inlies another major aspect of the open source comunity: rebel developers without a cause. Most developers code just because its fun, or because there is a vacume to be filled, or like me just do it to be-little the stock of major companies selling non-open software of the same merrits.

However, for those folks at the wall street journal (the anylists, market watchers, and the entrenched hardcore oldies) who look at all bussiness's prospects. To them they see "open source" as something almost anti-capitalistinc, or rather something to sink you money into if you are eager to loss money. From their perspective, open source is an open-money pit ready for a camp fire. Lets just say I belive the anyalisis of these folks are correct, open source's capital sucks... as it always has. DUh!!

Open source is not run by money. It is operated by the motivation of its creators, maintainers, etc.. Open source is a spark, but this spark doens't nessecarily power an engine of commerce. Rather the engine is the pride, the joy of accomplishment we humans have before we die. Sorta like the building of the pyramids: totally crazy, yet totally cool! ;)

I know I speak to the choir here on /. ... but heck... who cares, right?

Re:cost of nothing?

[Wateshay]

I know I shouldn't respond to trolls, but what the heck -- I feel like getting modded down as offtopic today. As a regular reader of the Wall Street Journal, I'd like to point out that they have generally been open to free software, if not downright friendly. A few months ago they even had an article on the front page of their market section about Ogg Vorbis. A lot of people on slashdot look at the slashdot flame wars about capitalist versus communist and assume everyone else thinks the same way. Therefore, they assume that as staunch supporters of capitalism newspapers and magazines like WSJ, Forbes, and The Economist will automatically take a knee jerk position that open source is evil, because it might harm the established capitalist big businesses out there. The truth, though, is that those papers & magazines care about the free market, not Big Corporation X. If you advocate elimination of copyright, or legislation that requires all software to be open source regardless of economic implications, then they will probably be against you (on the other hand, all three are generally impartial news sources who will report on both sides in a fair manner). On the other hand, if open source produces a better/cheaper product that ends up bankrupting Microsoft, Oracle and the other software giants, then they will applaud it for being innovative and raising the bar. Whether or not it looks like Marxist communism is irrelevant (it doesn't, but that's an argument for a different post in a different article).

Re:cost of nothing?

[JDizzy]

nope..... I make errors all the time.

Do I seem like a troll, or are you just quick to brand people?

Re:cost of nothing?

[JDizzy]

You have a skill of grossly miss-representing the context of my text.

Furthermore... Am I a troll? Seems like a label you cleanly assign at the top of your speech to de-validate me.... like an attack?

I would not like to argue with your nor would I like to dissect your labeling system of me. However, I would printout that your characterization, or implied belief in what I was saying seems to be incorrect based on your retort.

However, before I start... I would like to point out the insight you provide is, to a point, true... it is not about communism vs. capitalism... how you got that interpretation is anybody's guess?

No... what I say is that the economic analysts that are part of the major economic publications typically, and historically point to open source projects as a bad investment.

They, like most capitalist, see open source as a bad economic model, and rightly so. The folks in the open source community typically tend to do things for reasons greater that mere economic personal gain, however this is not always the case.

In general, I'd say that the folks at the major economic publications are bias, and tend to target their analysis to the older more conservative crowd of investors... this is also a crowd of folks almost diametrically different in views from the folks in the open source community.

However, I'm not saying it is the fault of these analysts that the very few open source developers that do earn a buck from a pay-roll get fired. No, it is simple math and a recession.

fairytail 'economy'

[Anonymous Coward]

what tripe. of course, the felonious kingdumb is dooing well, what with their stock FraUD holding up (LIEk magic), & them STILL holding 90% of the pc population (billy's very owned 'garmeNT disstricked') hostage.

& lest wee forget, the lamo gov't is in a mad dash frenzy, to get US back to 'business' as use-you-all. i'm surprised this 'story' is here at all.

baaah, baaah. wake up j., get your head out of your .asp. the 'good times' were only for a handful of FraUDulent swindlers. NOTHING has changed.

Re:fairytail 'economy'

[night_flyer]

Another good example of "throwing money at education" not fixing the problem....

Imagine That...

[night_flyer]

At least Microsoft is doing well.

2001-11-20 13:43:58 In typical microsoft fasion, they take over, not i (articles,news) (rejected)

Re:Imagine That...

[night_flyer]

an off topic rating for mentioning that I sent in the exact same article for submission....

Re:Imagine That...

[Anonymous Coward]

How about the fact that nobody fucking cares about your bitching and whining? Sounds like a winner to me, little Jimmy.

5 billion in R & D

[axehind]

Microsoft says it's going to spend about 5 billion this fiscal year on R & D. How are companies suppose to compete with that?

Re:5 billion in R & D

[night_flyer]

R&D to microsoft is Retail & Distribute

Re:5 billion in R & D

[zerofoo]

How about:

Release & Deny

Re:5 billion in R & D

[axehind]

Now that you say that, I wonder what they spend on lawyers a year.

Re:5 billion in R & D

[Anonymous Coward]

Who says all their research will turn results? IIRC Xerox spent _tons_ on research but only used the laser printer aspects of it all. Just because Microsoft has a thousand different research projects going on doesn't mean they can bring them to market and beat competition. I'm still skeptical about .NET myself (and I do believe it _could_ turn into a disaster if they don't play their cards right).

Re:5 billion in R & D

[mpcmpc]

"Compete" is not the right word. After all, open source code is free. Microsoft has long taken from the open source community, and I predict that after enough time, open source will take back. One good example is Exchange and Outlook. They have set a new standard for interoffice communication that tech geeks now take as a challenge. In the next 10 years, you will see open source groups take on this market to provide a viable alternative.

Uhh...

[NiftyNews]

I hate when work gets in the way of my workday.

Motivations/expectations a factor

[penguin_dance]

It really comes down to what the real motivations of the company or collective programming the software are.

If it's purely profit motivate then they're unlikely to succeed. Quotes like, "'Where is our business model if everyone else can copy it?' asked Holger Dyroff, former CEO and now director of sales for Linux software seller SuSE. 'The question is where we can make money now. Nobody cared about profitability two years ago,'" are very telling. (Is anyone else concerned that this guy is now the director of sales for SuSE?)

Those, OTOH, who themselves have a need or a desire to create will be satisfied with the results. Perhaps some will make both free and paid programs just like many software authors do to pay the bills. The point is, you do it for the love of creation.

Open source, IMHO, was never meant to be a cash cow by it's very nature. Giving a software away and then expecting a profit makes me wonder where some of these people went to business school. They're in the wrong business. Red Hat has a big slice of the corporate Linux pie and even they have struggled to make a profit from service.

Much of the upset in this parallels that going on in the Internet. Those who jumped in to make a fast buck will be disappointed. What we will be left with are the tried and true who just believe in the IDEA.

Re:Motivations/expectations a factor

[Anonymous Coward]

If people went out and bought the really fantastically cheap stuff that SuSE packages quite beautifully and then downloaded the
newer stuff when they needed to instead of freeloading(thats right) off the bat then there
would be some motivation to continue with pure
OSS. As it is: Have You Taken A Look at where SuSE is and what they have been involoved in?

The cutting edge X, reiserfs, LVM and
dozens of other projects whose code is SuSE
backed and developed needs to be supported
by the users, whether or not the distro is purchased. Better: buy a f*in distro: it's $40, or buy REDHAT or debian or whoever. Just s
support these guys.
it's not like you can't change what you don't like, add on limitlessly, etc.. or get the upgrades for free later.

If OSS is not supported it will die, and be
left for the diehards to quarrel with each
other about premature burials.

Open or closed, does it matter?

[Ars-Fartsica]

VA Linux didn't fail due to the "openness" of its products - considering that until recently its primary business was hardware. VA simply couldn't be price-competitive with larger hardware vendors. As for SourceForge, its not clear that its a very compelling revenue-generator in any case - regardless of the openness of its source.

As for the other companies, most of them were questionable in any sense, and considering that most of them were predicated on the fad aspect of open source, it should come as no surprise that they flopped.

There is hope though, RedHat seems to be doing respectably, and IBM is making large investments in open source that are predicated upon sound business principles.

Slowed, but not stopped.

[Newt-dog]

Generally, I would say that some of the Open Source projects I monitor have slowed in the release cycle, but for the most part, things haven't stopped. I think it could be that for most of us OS is a hobby. When things are fat, we generally have more time to play and code, when times are lean, most of us are scrambling for the almighty buck.

Newt-dog

Open Source Benefits Users Not Software Developers

[Carnage4Life]

The beauty of Open Source especially Free Software is that it gives immeasurable benefit to users. Unfortunately it also takes away from developers the opportunity to make money just from software. Now this doesn't mean people can't make money from Open Source, they can. It just means that the people who'll make money from Open Source are most likely the people who use it as a means to an end (e.g. IBM, TiVo) and not the ones who spend time and money developing software only to give it away or try to charge for software that can be obtained elsewhere for free.

This is why Microsoft does not like Open Source because they think long term and can see the future. Eventually Open Source will drive away off-the-shelf software, and the only people making money from it will be the consultants and the hardware people (again IBM is already be at the forefront of this) who are actually primarily users and in most cases not developers of the software. Giving away software and trying to make it up in services that anyone else could provide is a dead business model because there is zero barrier to entry into the market. The one who does all the initial expenditure of capital to create the market and develop the products can be subpurned at any time by anyone with enough capital to enter the market. VA Linux found out exactly what happens when you rely on Open Source in a market with zero barrier to entry...thats right, the big boys with money come in and take over your playground.

Microsoft is smart and has already started branching out to get ready for the software apocalypse. XBox and .NET MyServices (aka Hailstorm) are just the beginning. If you work for a company that isn't thinking that far ahead then I suggest you begin to plan your future elsewhere or start working towards being an independent.

IMHO, in the future once Open Source Software is commonplace the people making money from software will all be users; consultants and people who use it as a way to avoid paying high licensing costs. This is fine by me since consulting sounds like fun and is better than being a cog in the wheel anyway.

At least open source video editing

[heroine]

Can definitely assert that open source video editing took a hit. Kino and Linux Video Studio programs are great consumer tools but no good for professional work. The professional offerings died when VA Research/linux/software/I.O.U. tanked, not to mention cluster management software. Let's put it this way.

4 years ago open source was moving a lot faster with software costs not being the responsibility of the programmers while X Box, Pocket PC, and C# seemed dead in the water. Today open source programmers have to pay for their own software and criticizing those dead in the water projects, X Box, Pocket PC, and C# for being too slow get you banished from slashdot.

"At least Microsoft is doing well..."

[dpilot]

You'd think that some IT execs would look at the better-than-market performance of Microsoft, and then look at the *pain* they're having on their bottom line with IT expenses, and figure out that there is some relationship between the two. Then start plotting an escape.

Natural Selection not an OSS problem

[Kefaa]

The objective of OSS is the sharing of information in hopes of return. I have code that will do "X" and need it to do "X+Y". Hey, you happened to have done "Y" and can send it to me.

Soon enough people are sharing that not only is "X+Y+Z..." available, but I can get the entire package without any work on my part. Unfair? Hardly. People who needed them built "X" and Y and Z, and could not wait. They hope that when they need "Q" or "R" or "S" you will pass it on to them. [Like we do in our offices on a weekly basis.]

In addition, they ask that if you enhance or fix "X", you send it back so we all benefit. Let's face it, I gave you 20000 lines of code, you put in a 20-line fix, sounds like a good deal to me. Or if you cannot fix it, tell me it is out there so I do not find it a 3:00 a.m.

I also want to be certain you do not take "X+Y+Z", put your name on it and sell it. Much like I would frown on my neighbor planting crops in my yard and selling them.

So why is the business side of this failing? It is not, if we consider that around 50% of US businesses fail each year, and many of those are based on products. For a service model to work, I need to bring something to you, you do not have. To keep you as a customer I must always have more, know more, or control more.

OSS development is the antithesis of this. We are sharing in hopes the information will become well known. We want everyone to be as good as we are, because we want to use them as a resource, like they use us. We also recognize that OSS is many times a short cut toward, not the solution prepackaged for consumption. This means your people can be as knowledgeable as OSS developers, because we do not hide how we do it. Great for OSS, tough on Service companies without a value add piece.

Being unemployed...

[Ron Harwood]

...until Dec 17th has given me plenty of time to work on my open source project...

You just can't argue with logic like that!

[Anonymous Coward]

Is this a public company? Can we short the stock?

Re:You just can't argue with logic like that!

[Anonymous Coward]

Good luck shorting a company which is getting in position to last.

I myself would have shorted LNUX or RHAT when they were (and still are IMO) way overvaluated. Could have made a _ton_.

Re:You just can't argue with logic like that!

[mrcparker]

Wish I could tell you - you could have made a fortune on the company I work at. Yes, they are a major company, and they have made some bizarre decisions that have caused the stock to nosedive.

They are making the same decisions that the last company I work for did (a rather large oil company in Houston that starts with the letter 'E'). Hope they don't turn out the same way.

Re:You just can't argue with logic like that!

[Anonymous Coward]

I myself would have shorted LNUX or RHAT when they were (and still are IMO) way overvaluated. Could have made a _ton_.

What do you mean you "would have... when they were (and still are IMO) way overvaluated."?

I don't just mean what language is "overvaluated" supposed to be, I mean since you think that they are "overvaluated" right now you either are shorting them or you aren't. If you aren't then to say you "would" do is meaningless.

"I would do, only I'm not"?

Re:You just can't argue with logic like that!

[Anonymous Coward]

It's simple. I'm saying RHAT and LNUX are worthless. Not worth a damn cent. But that does not mean I believe they will go less than the $5 or the $2 they are valued at today.

Windows is cheaper then linux

[Anonymous Coward]

Ya, opensource rocks! Companies are going belly up and the blood is flowing like a river of blood from companies willing to base their whole income based on opensource. Funding opensource is like dumping a truckload of money in a bottomless pit. Microsoft seems to be the only company making money. Sun decided to hop on the opensource bandwagon and guess what happened? They began to lose money. Now they are proprietary again and money is slowing but surely coming back. Caldera is going close source and suse wants to go close source source as well. Remember that if something does not make money then its bad. After all IIS and Windows are the best products out there because Microsoft makes the most money. Many phbs and CIO's really get the big picture in regards to this. Also McDonalds makes the most money so their food is also better. I take my wife there all the time during our anniversaries. She complains but I know the food is better at a McDonalds then a nice French restaurant because McDonalds makes more money. Boy, I sure love the way CIO's and IT managers think. Well I need to re-install XP and make sure it works because I already activated it twice and I am afraid I may have to pay again if I activate it a third time. Well, see you all later.

Re:Windows is cheaper then linux

[Anonymous Coward]

Course I don't see any 5 star restaurants giving their food away for free... In fact McD sells their food at such cheap prices it's probably more analougus to Open Source. Course if McD were OS then all their employees would have to work for free and make money as chefs working in the 5 star restraunts.

Surprise, surprise

[underpaidISPtech]

The economy is in the shitter. This whole article is nearly pointless. Open-source (the business model) was circling the drain before any other sector of industry was, and this is news?

And now to burn some karma....

I think that the open-source phenomenon will quietly, undignifiably, dissapear soon. It is a lofty and noble goal to be sure, however as a sustainable movement, I believe it will become less important over time. Why? Because the high-flying VC money and gold-rush speculation that drove those fat boomtime salaries are what really paid for open-source. The time to code the time to host it, the time to collaborate, just aint there any more during the dot-bomb hangover.

Open-source is an idea; that will remain. Linux the kernel, and any derivatives; they will remain. Unix is still with us after 30 odd years, and so too will Linux and OSS. Good. But, making money and supplanting a capitalistic machine that is designed for high proiduct turn-over, planned obsolecence, and not giving the customer what they want is the sustainable model, not selling services to free products. If you pay for the product, then you will pay for support. Get a free product, and you find out its not up to par or whatver, why pay for support, just get another free clone....

As an example, look at the mp3, CDR, DVD products out there. Is there a single product (game console, entertainment device or otherwise) that can play mp3s, read and write CDR, CDRW, DVD, DVD-ROM/RAM/RW and any other format? No. It is much better business sense to force the consumer to buy a couple of different devices than one do-it all device.

As with software, you want return customers, hence the excruciatingly long path to a stable windows platform (some may argue this point, although at this time I think it's the licensing/terms of use that is the problem not the OS itself).

There is alot of uncertainty around everthing right now, both socially and economically, and open-source is a real gamble. Will it become a security threat to use OSS? Of course it isnt, we know better than that, but we don't make the law.

Where does crypto stand? Do you want to continue to code for free, or maybe you're unemployed (or facing it) and would like to see a return on your effort? I dont think selling services is the way. I can just as easily support your software as you can.

Anyways flame away, mod me down for blasphemy, whatever, maybe I forgot my happy pills this morning...

Re:Surprise, surprise

[geomon]

I believe it will become less important over time. Why? Because the high-flying VC money and gold-rush speculation that drove those fat boomtime salaries are what really paid for open-source.

Now that we have heard from Bill Gates, perhaps we can pump a little more reality into the discussion.

When I started using Linux in 1994, the Information Superhighway wasn't on the radar. MOST IT jobs were in the same sectors that they are in now: database management. At that time, I saw thousands of listings on usenet for DB administrators and sysadmins. What the hell did those jobs have to do with open source? Nothing! People got paid for computing and open source projects were flourishing. This momentary dip in open source funding does not equate to a death knell for non-proprietary software development.

But now that you have done your obligatory dance on the open source grave, keep this in mind: As long as there are programmers who are willing to collectivly contribute their spare time to a project, open source will survive. That may seem alien to you, but people contribute to all kinds of collaborative efforts without the expectation of monitary gain ($1BUSD donated to Red Cross).

You might not agree with the cooperative sentiment, but there is 400 years of history behind the open source philosophy.

Re:Surprise, surprise

[MessiahXI]

But now that you have done your obligatory dance on the open source grave, keep this in mind: As long as there are programmers who are willing to collectivly contribute their spare time to a project, open source will survive. That may seem alien to you, but people contribute to all kinds of collaborative efforts without the expectation of monitary gain ($1BUSD donated to Red Cross).

You totally missed his point. He clearly said that he didn't think that Linux or other OSS projects would disappear; just the "business model". But, whatever. You got your karma; that was the point right?

Re:Surprise, surprise

[reflective recursion]

I agree with your points and some of the original posters.

I believe "Open Source(TM)" hoopla will die down and that is a great thing. It means there will be a time again that I can go to freshmeat and find decent programs which are not in the "pre-planning almost idea not quite vapor yet but hey! look at me! I got XML!" stage. Instead of trying to impress or compete, programs will just be there--like the good old days. Don't work for ya? Fix it or find another program that does what you want. No more elaborate bugtracking, CVS project management, IRC server and 10 different mailing lists. Just the source code and a README. Nothing more nothing less. No elaborate schemes for hijacking others projects or dirt throwing. No more hype. Just software and the enjoyment of computers.

Ah, but I believe those days are long gone. Things have changed. People make money on other's work. It isn't the same atmosphere as even 1996 (when I discovered Linux). I think many people have become jaded. The same jadedness that caused Richard Stallman to create the FSF in the first place? Possibly.

Re:Surprise, surprise

[Anonymous Coward]

Those contributions to ARC wouldn't happen
to be tax deductable would they?

Re:Surprise, surprise

[Skapare]

But, making money and supplanting a capitalistic machine that is designed for high proiduct turn-over, planned obsolecence, and not giving the customer what they want is the sustainable model, not selling services to free products. If you pay for the product, then you will pay for support. Get a free product, and you find out its not up to par or whatver, why pay for support, just get another free clone....

The reference to selling support for a free product is probably true. However there is a variation on this that can potentially succeed. By selling a service, not as support for some free product, but as a service in and of itself which happens to have free source tools as its foundation, you are then selling a complete solution to a business. Few businesses are going to choose Linux for the sake of having Linux. What businesses want is something that works for them, and most of them (smaller ones, anyway) want something someone else is going to take care of. So instead of selling "Support for that Linux you bought", you sell "A service to manage your office computers and network" which you've chosen Linux (or whatever) to be a part of that.

Re:Surprise, surprise

[ChaosDiscordSimple]

Open source software has been and will continue to be profitable. It may not be insanely profitable, it may not apply to every problem, it may be unconventional, but it works. It will slowly grow, because once open source moves into an area, it becomes very hard to dislodge.

Sleepcat Software's open source Berkeley DB has "been profitable since inception" in 1996

Using multiple licensing models L. Peter Deutsch is able to provide Ghostscript under the GPL and make enough money to retire.

Cygnus Support (now part of Red Hat), was founded in 1989 and was "profitable, increasingly profitable, every single year" before the Red Hat buyout.

It's very unconvential, O'Reilly must be happy enough with sales of books to pay Larry Wall to keep developing Perl.

Open Source works. Maybe not as well as VA Linu... erm... Systems wants it to, but it does.

Re:Surprise, surprise

[dkixk]

I think that the open-source phenomenon will quietly, undignifiably, dissapear soon. It is a lofty and noble goal to be sure, however as a sustainable movement, I believe it will become less important over time. Why? Because the high-flying VC money and gold-rush speculation that drove those fat boomtime salaries are what really paid for open-source. The time to code the time to host it, the time to collaborate, just aint there any more during the dot-bomb hangover.

It depends on how you define the term open source. You hint at this in the paragraph that follows.

Open-source is an idea; that will remain. Linux the kernel, and any derivatives; they will remain. Unix is still with us after 30 odd years, and so too will Linux and OSS. Good. But, making money and supplanting a capitalistic machine that is designed for high proiduct turn-over, planned obsolecence, and not giving the customer what they want is the sustainable model, not selling services to free products. If you pay for the product, then you will pay for support. Get a free product, and you find out its not up to par or whatver, why pay for support, just get another free clone....

When you write in the first paragraph that open source will "quietly, undignifiably [sic], dissapear [sic]" but then write in this paragraph that "Linux the kernel, and any derivatives [...] will remain," you are implying that the most important aspect of open source is "making money and supplanting a capitalistic machine." I'm more than a little confused as to how making money could possibly help supplant a capitalistic machine but I'm assuming that you meant something more like "supplanting the capitalistic machine based on proprietary software with one based on open source software." Well, perhaps it is an important element of what many people mean when they use the term open source as a conscious decision to avoid the term free software. In other words, I think that some people who use the term open source, e.g. Eric Raymond, invented the term specifically to describe the socio-economic concept of making money from non-proprietary software. So, what if we talk about free software, i.e. open source software without the libertarian, capitalist spin? Will free software disappear? You yourself even wrote that "Linux the kernel, and any derivatives [...] will remain." Not only Linux but GNU, BSD, et al, will remain for quite a long time. In this sense, how is free software failing? If I want to use software that I am free to copy, modify, and share with the community, I can still do it. Was this not the original aim of the FSF and the GNU project? Larry Wall can still keep providing Perl. I can still look at all of the source code to BSD and W. Richard Steven's TCP/IP Illustrated, Volume 2 is as free to publish all the gory details of the BSD implementation of the TCP/IP stack today as it was when he first wrote it. How are any of these things failures for free software?

Personally, I think that free software will continue to flourish in the same way that it has always flourished, e.g. as a free exchange of ideas communicated with source code in the grand tradition of a academic community. Perhaps the views of those who supported the idea, for example, of "Open Source as a Business Strategy" might have try and buttress their arguments in the light of economic realities. Of course, if some of these open source businesses might even manage to survive the current economic downturn and come out strong on the upturn. However, for those who think that one can see "Open Source Software Development as a Special Type of Academic Research", the particular market woes of any .bomb have little, if any, relevance. And what could possible interfere with Larry Wall's idea of open source development as an exercise in "Diligence, Patience, and Humility"?

Re:Surprise, surprise

[underpaidISPtech]

OK, here is my general rebuttal/addition to the responses received thus far...

The original article focused, as most mainstream articles do, on the business aspect of OSS. I feel I made my stance on that clear, so I won't persue it further.

I would like to add to my position on OSS the movement. Again, I believe that it will continue to grow, and perhaps I should add that "undignifiable death" was a little off. Maybe "waning from" the radar of the mainstream press is more fitting. Which is fine, as some posters commented. I think OSS will still have a strong position within IT depts all over the planet, based on it's strengths of (duh) openess, managebility, and extensibility. OSS is a great tool for custom solutions and extending what is already there. Don't have what you need? DIY or have a look on Google.

However, as an example, my employer is looking to purchase a front/backend "e-commerce" (egad...) solution to increase our webhosting, dial-up, etc sales. Instead of taking the available tools out there and creating a custom solution to their specs, they are willing to throw money at a proprietary solution. Now, I'm no VP or CTO, so perhaps they have their reasons, but when there are so many options for tooling up something yourself, why not use OSS?

Also, with OSS as a "failed business model", it looks to the uninformed as if OSS itself tanked. The only thing that could fix that for the people that make decisions (on the whole, MBAs PHBs) is a massive marketing campaign to clean up the image.

I've said it before on /. that .NET as a marketing push is far more sexier than Apache+PHP+MySql, or Apache+Jserv+J2EE (hope I got that right). Still, OSS tools will always find their way into the backroom and I hope (know?) it will thrive there.
I just shudder at the thought that the only companies that will be using OSS
will be the ones thinking, "Geez, can't afford .NET, what else is there?" Instead of choosing it on merit, they chose it simply on price. When they get a bit bigger , the company may (gak!) move over to .NET or whatever "solution" they need, ignoring what they have working for them. Everone's a sucker for a shiny new toy, software is no different.

OSS will obviuosly continue, the only thing that will kill an idea is lack of interest in that idea. I guess my point was that in a few years, lack of interest could hobble OSS, due to fewer people being aware, or a bad rap or whatever.

And BTW, nice dig about "hearing from Bill Gates".
Clever.

OS atheist -- underpaidISPtech

Re:Surprise, surprise

[Bruce Perens]

Because the high-flying VC money and gold-rush speculation that drove those fat boomtime salaries are what really paid for open-source.

Gee, where have you been? We've been working on this, if you count from the start of the GNU project, since the early eighties (and some would say longer). VC and stock money was fun, hey, I got two years employment out of it, but it was a blip in a continuing history. Most of the good work has been, and continues to be, done without it.

Bruce

Re:Surprise, surprise

[underpaidISPtech]

OMG! Bruce Perens!

Heh, well, in the 80's I was in <sheepish> elementary school, so please appreciate that my perspective in this matter is limited to ~'94 and after...

FWIW, my point about VC cash was that the gold-rush mentality helped fund OSDN, /., Sourceforge, and the like ( from my observations) allowing an explosion of collaboration (plus time/effort) and hype that has since died off somewhat.

Re:Surprise, surprise

[sheldon]

"Is there a single product (game console, entertainment device or otherwise) that can play mp3s, read and write CDR, CDRW, DVD, DVD-ROM/RAM/RW and any other format? No. It is much better business sense to force the consumer to buy a couple of different devices than one do-it all device."

Well you could always go out and buy a Pioneer DVR-A03 and install it into a small personal computer. The drive reads and writes CDR, CDRW, DVD-R, DVD-RW.

The drives are getting cheaper, now down around $450.

I don't think your complaint is terribly valid. People don't want single purpose speciality devices. But they are willing to buy an add-on to a personal computer like what Pioneer sells, which then makes you capable of doing what you ask.

I think the same is true with software.

As a company you do the best you can with the technology available, understanding that you need to be able to bring your product in under a certain price point. If Pioneer charged $5,000 for their drive, I would not buy it. At $450 I am going to consider it. At $200 I would have already bought one.

Re:Surprise, surprise

[Ogerman]

I think that the open-source phenomenon will quietly, undignifiably, dissapear soon. It is a lofty and noble goal to be sure, however as a sustainable movement, I believe it will become less important over time. Why? Because the high-flying VC money and gold-rush speculation that drove those fat boomtime salaries are what really paid for open-source. The time to code the time to host it, the time to collaborate, just aint there any more during the dot-bomb hangover.

You're forgetting a big part of the picture. At a certain point, it is cheaper for companies to pay some programmers to extend an Open Source package than it is to buy proprietary software licenses. Lets say that after OpenOffice reaches 1.0 status, lots of people start switching from MS Office. Now company X, which is thinking about upgrading its office software in the next 3 months, realizes that OpenOffice is missing some feature that they need. It would cost them $20,000 to contract a programmer or two to add the needed feature or $100,000 to buy all the licenses they'd need for the latest MS Office. Which are they going to choose?

Re:Surprise, surprise

[Chris Johnson]

"I think that the open-source phenomenon will quietly, undignifiably, dissapear soon. It is a lofty and noble goal to be sure, however as a sustainable movement, I believe it will become less important over time. Why? Because the high-flying VC money and gold-rush speculation that drove those fat boomtime salaries are what really paid for open-source."

Wow- rarely have I seen a point missed so breathtakingly :)

What on earth gives you the idea that open source was driven by capitalistic goals? Critics of OSS often call it 'communist' or perhaps 'socialist' and there's some element of truth to it, but to a large extent it is an anarchist phenomenon- key licenses such as the GPL deftly render centralised control absolutely impossible.

Open source is not an economic phenomenon in the first place. It's an information-control phenomenon- it's not driven and sustained by the direct motivation of greed and profit, it is driven by a REACTION against information control. The whole POINT is to establish a commons of software information that cannot be taken away from people, or placed under hierarchical control. Hence, the anarchist analogy.

During the 'dot-bomb hangover', things are so tight that the proprietary guys, in the best tradition of their centralized-control, creator/consumer (not to say master/slave!) system, inevitably turn to controlling their consumers, withholding more, figuring out ways to turn the screws and compel payment from people who themselves are hard pressed. The VC money isn't there anymore and it's 'make people pay' time.

This will drive more Open Source proliferation, rather than less- because OSS is not driven by people's desire for personal gain, it is driven through people's desire to escape a bind. The tighter you turn the screws on people, the MORE they will flee to open source software authoring and using- if they can.

Barring really interesting authoritarian behavior way beyond simply outlawing OSS- they can. You have it exactly backwards and are looking in the wrong places for motivation-to-use-and-code-OSS...

Re:Surprise, surprise

[geomon]

Acronym filter = lameness filter.

How do employees of government agencies get on slashdot?

AFAIK.

IANATL.

Re:Surprise, surprise

[geomon]

You totally missed his point.

He made several points. I responded to the one I disagreed with.

He clearly said that he didn't think that Linux or other OSS projects would disappear; just the "business model".

And if his crystal ball is so accurate, why didn't he make this statement 5 years ago.

Hindsight is always so clear.

But,whatever. You got your karma; that was the point right?

Just to make you happy, I posted this at a "No Score +1 Bonus".

I guess you are not interested in *my* point, right?

Re:Surprise, surprise

[Bruce Perens]

OK, coming in at 1994 you're going to miss a lot, although you could have been around a lot of projects that had excellent collaboration before SourceForge and its ilk. I ran some collaborative projects on USENET before there was an Internet that mere mortals could access, and in fact released important Free Software like Electric Fence that way. Debian's main method of collaboration was in 1994, and continues to be, email and simple file transfers. The web is fun, but not essential - but some means of digital communications is essential.

So, we did get some hype, yes, but IBM's spending more on Linux hype today than has ever been spent before.

I'm going to write a commentary on CNET to reply to Steve.

Bruce

Re:Surprise, surprise

[Puk]

You don't actually mean that, do you? You don't gain money by making tax deductible donations, you know -- you just lose less than the gross amount you donated.

-Puk

Re:Surprise, surprise

[Anonymous Coward]

re:

As an example, look at the mp3, CDR, DVD products out there. Is there a single product (game console, entertainment device or otherwise) that can play mp3s, read and write CDR, CDRW, DVD, DVD-ROM/RAM/RW and any other format? No. It is much better business sense to force the consumer to buy a couple of different devices than one do-it all device.


Actually, Apple's PowerMac G4 with the SuperDrive will handle most of those formats, and come with decent video and audio software as well.

According to http://www.apple.com/store/, supported formats are: CD-ROM, CD-Audio, CD-R, CD-RW, CDI, CD Bridge, CD Extended, CD Mixed Mode, Photo CD, DVD-Video, DVD-ROM, and DVD-R.

FWIW...

SuSE guy is clueless

[reaper20]

"Where is our business model if everyone else can copy it?" asked Holger Dyroff, former CEO and now director of sales for Linux software seller SuSE. "The question is where we can make money now. Nobody cared about profitability two years ago."

Oh, ok, his company didn't care about profitability two years ago, and SOMEHOW, this is open software's fault, hey wait a minute, isn't YaST closed source?

"The development model of open-source software is wonderful. But let's not confuse a development model with a business model. Basic business principles were forgotten by some," said Turbolinux Chief Executive Ly-Huong Pham.

Now that is the smartest thing I've heard regarding OSS companies and their lack of profitability.

This is all bandwagoning - If you are an incompetent company, you are going to fail, regardless, evidently SuSE didn't even care about profitabilty until recently ... WHAT!? I'm sorry, but you could be selling liquid gold and still fail with that mindset.

Who found the Open Source b-plan?

[mnf999]

OK, the article is actually interesting. Having founded JBoss Group, a commercial entity behind JBoss I relate to many of the points.

But somehow the thinking is backwards still, thinking with old filters. One of the fundamental flaws of business in open source is that you give away your core competency.

But then OSS existed before companies tried to grow on its ground (Linux) and very succesful service companies existed independently of Open Source (EDS). So there must be a middle ground.

I believe part of the problem is that is that business folks out there (mostly VCs, I have met my share of arrogance back in the good ol days of the valley, confusion!) well VCs try to apply the old model of company building on the new way of producing software. It doesn't work. Open Source CANNOT support fat and overhead and corporate structures, just because IT CAN'T.

My (small) company is profitable and we are growing but I clearly see that I cannot AND SHOULD NOT grow with employees, just not flexible enough. As research on business plans goes, I understand that JBoss even though it is in the very rich field of enterprise software (and there is a lot of service), well JBoss for all its success cannot support a massive company right now. And again it is probably not the right structure ANYWAY. VCs got it wrong, most business men are scratching their heads, we at JBoss Group are trying, trying hard. Can't say we got it, we don't, but like many others in open source we make a living.

We offer many services around our free product are thinking about subscriptions and paying for information. The product is free, the service is not. The information is not (documentation, help, support, training (plug: http://www.jboss.org)).

Training is our biggest gig, people want to meet the developers of the framework. Also I don't think this would work with "GUI" frameworks. Just not enough customization to go by. If it is hard in the J2EE field, I can imagine how much harder it is in other fields.

Had I taken VC money (not that it was offered) or had I hired anybody left and right with borrowed money (what VC money is in the first place), well I WOULD BE DEAD TODAY.

It's a bitch out there, but I for one still believe, believe strong, we'll get it

marcf

Don't Forget to Stop by the ATM!

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Are we losing the rats or the driftwood

[Wateshay]

The way I see it, there are two ways that this can be looked at. The knee-jerk paranoid reaction is that the rats are jumping ship, and the end of open source is looming just over the horizon. And it just might be true. Open source is a radical, untested business model, and as much as we slashdotters want it to succeed, it may just be a deeply flawed system that will never work long term and large scale. That's not the only way to read this, though, and I certainly hope a more positive view is the reality.

Every new industry goes through an initial period of boom, where everyone sees golden opportunities and jumps onboard. Eventually the market gets saturated with a lot of poorly conceived wannabes that jumped on, and it collapses under its own weight. When that happens, though, the market doesn't go away. Instead, the most solid competitors survive the collapse and come back stronger than ever.

So far, it seems that we are looking at the initial collapse right now and we can expect a few casualties. The survivors, though, will come back stronger than ever and take open source to the next level. Furthermore, open source has the unique advantage that the casualties don't disappear completely, but rather the failed companies' products live on due to their open nature.

When the big boys (IBM, Sun, SGI, etc.) with the resources to weather the storm start to jump ship, then I'll start to worry. Until then, I look at this as a sign that open source is ready to move to the next level.

Re:Are we losing the rats or the driftwood

[Znork]

Any sane model based on Open Source software does not even include the concept of making money by selling software, because that idea is doomed to fail.

You _save_ money by using opensource software, driving some other buisness model entirely. Using open source software to reduce IT budgets, using open source software in the solutions that you sell, using open source software to drive hardware, and using it to compete with your poor license beridden or proprietary development beridden competitors who simply cannot match your cost effectiveness. Of course, there are also several possible services based models, but these require real added value and/or a large market base.

I'd worry if IBM dropped the idea, because they have a buisness model suited to using opensource. Sun has always been sorta-maybe about opensource, and I think their corporate subconscious ID really would prefer replacing MS and Intel with themselves. But they see the pragmatic benefits of fostering development that doesnt leave them alone facing the Final Conflict of Doom. SGI have their own problems.

What really would be good is if some of the other huge consultant corporations start bidding wars against eachother for largescale corporate implementations of linux installations.

Who writes open-source software?

[Salamander]

Historically, I think open-source software has been written by two groups of people: college students, people working on their own time, and professional programmers stealing time and resources from their employers. The first two groups are pretty constant; good times or bad, the numbers will be almost the same. During the dot-com boom, a lot of people in the last group started fleecing investors instead of employers, but that's coming to an end now.

Nowadays you're going to see two dnamics at work. On the one hand a lot of those who once hoped to become dot-com millionaires are being laid off. They'll go back to what they did before, whatever that was, and they'll sneak in what time they can doing open-source projects. At the same time, employers are going to be a lot more focused on the bottom line, cutting deadwood and leaving schedules the same. This will create more schedule pressure, and an incentive not to be the one who appears "unproductive" when the next layoff hits. Between these two factors, I think we'll see a net decrease in the amount of time devoted to open source by people in this group. That shortfall will not be made up by the people who remain unemployed for long periods and figure they might as well use the "enforced downtime" to work on their open-source projects, because those people are likely to be the bottom of the barrel. If they were that good, they wouldn't be remaining unemployed for long even in tough economic times.

In short, lean times are bad for open source. We can expect a slow-down in the pace of open-source development for as long as the bad times last.

Re:Who writes open-source software?

[Salamander]

Oops, that's one of the dangers of overediting. Obviously there are three groups, but I forgot to change "two groups" from an earlier draft.

Re:Who writes open-source software?

[mnf999]

interesting if not funny. I don't know the demographics of other projects but go see our team here.

yes many of them are actually stealing time on their job but many are also professionals taking the jump. I for one live of open source, I don't have a dumb job, haven't for the past year or so. It is ok, better living, more money, but it is not a "millionaire dot-com thing".

Bottom line: don't dismiss the open source model for a way FOR INDIVIDUALS TO MAKE MONEY.

I seriously think that one of the problems here is that you all assume that you must be working for some stupid corporation to make a living. Actually you can make a living too in open source it is not difficult.

marcf

Re:Who writes open-source software?

[Salamander]

yes many of them are actually stealing time on their job but many are also professionals taking the jump

If so, then good for them and good luck to all of you. However, I'm sure you know that one anecdote doesn't prove much of anything. I've dealt with hundreds of open-source developers, and I can only think of one or two who don't fall into one of the three categories I mentioned. Even those few are questionable cases; they make enough money from consulting to have a lot of free time that they then spend on open-source development, but I'm not sure if that qualifies as "making a living from open-source software".

I seriously think that one of the problems here is that you all assume that you must be working for some stupid corporation to make a living.

I for one don't make that assumption. Several of my friends have done quite well over the years on the consulting/contracting circuit, and I know I could join them any time I wished. Yes, even now, with the high-tech economy sucking wind. However, consulting/contracting != open source. Maybe I could make it a term of my contracts that any code I produced be open source, and still make a living, but I don't think that would be the usual case. Freelancers don't usually have that kind of leverage; all but the creme de la creme usually take whatever they can get.

Actually you can make a living too in open source it is not difficult.

I could make a living as a consultant, on open or closed source, but it's not clear what that has to do with "making a living in open source". Let's wait a little while and see if JBoss's classic-dot-com business model really holds up over time or whether those T-shirts and mugs you sell on your website (pets.com anyone?) end up as dot-bomb souvenirs.

Corporations expect you to pay for it

[heroine]

When you release a substantial piece of
software corporations usually expect you to pay
your own support costs, including flying to the
location to troubleshoot it. They expect the
support cost to be covered in the license fee,
which for you was 0. If you don't provide support
they'll make you wish you never gave out the
software to begin with.

Re:Corporations expect you to pay for it

[SirSlud]

Agreed. Thats what I was saying .. charging for Services and Support doesn't work. It's akin to saying 'The software is free, but you have to pay when it breaks/you can use it.' It's like banking your business model on your softwares lack of ease of use or propesity for not working.

Re:Corporations expect you to pay for it

[mnf999]

Bull shit,

people don't buy support for JBOSS because THEY DON"T NEED IT. We don't force them to (unlike our competition BEA that has MANDATORY support).

Then there is exactly the reverse, motherfucker at some big company in the UK that wants a feature done and when we quote him a price to do it (free software != free developers) he says that is "not open source". Fucking jerk expects it for FREE! Needless to say we don't care!!!!

No, get real, the services companies are the most succesful ones out there (EDS, Cap Gemini, even IBM!) and you guys talk like nothing existed outside the sales of licenses.

ridiculous and against current facts

Re:Corporations expect you to pay for it

[einhverfr]

Funny. Microsoft charges for all these things...

Re:Corporations expect you to pay for it

[SirSlud]

Ahh .. additional development/cuztomization is where its at. Agreed. I was only referring to technical support and training.

When it comes to customizing solutions or adding features at a customer's request, I think those are definate opportunities to get revenue, in a context where the customer feels they are getting something for it in return, other than the ability to _use_ the OS'd software.

Anyways, point taken.

Unemployment is an opportunity

[braddock]

Unemployment is an opportunity for community service and personal improvement.

In this way, Open Source projects should benefit from a technology slump. People should see this as a chance to learn what they want, and pad their resume with community-oriented achievements and new skills. A potential employer will see this self-motivation as a fantastic quality.

Braddock Gaskill

Its just human behavior....

[azephrahel]

Really, this is just human behavior.
When we have all the time we want to work on our projects, they move at a snails pace... when we only have 2 hours a night, we cram through it.

Utility of the Work

[namespan]

I'm sitting in on an Economics class at the local university right now, and I've brought up open source a time or two in class. The instructor, who really is a sharp guy, finds a lot of aspects of it baffling.

I think it's because the conventional economic thinking tends to divide human activity in to consumption and labor. Labor is, by and large, done to receive wages with which one consumes.

What I think they forget is that some work is actually done for the enjoyment of the work/accomplishment (economic speak: some people actually derive utility from some work).

So while some observers may look and see a slowdown in the open source world, my guess is that reality is a little different. There's probably a slowdown at open source companies -- just like there has been at many closed-source companies -- but those who've been coding to scratch an itch, or for the fun of it, I'm sure that hasn't stopped at all, unless things have gotten so bad that coders have had to start spending all their time foraging for food and shelter.

As long as hackers have spare time, open source will exist. As long as the protocols/comm infrastructure is reasonably open, open source will probably thrive.

Make money in open source by reduced devel costs..

[sterno]

A common problem with open source software developers is that they seem to be convinced that they can fund most of the development effort of a product and still make a good profit on the product.

Look at what RedHat does, they sell Linux support and services and they package the product with instructions, etc. Are they the primary developer of Linux? No. They fund a small chunk of development, enough to give them some say in where it goes, but not enough to really hurt their bottom line. Now we have RedHat DB which is simply a repackaged postgresql, yet another thing they've not put vast resources into. Because of those reduced costs they can actually afford to have a business where the software they sell is free to download.

The power of open source comes from a community burden of development. Several people and organizations can share the costs of developing the software. Something that I have yet to see take hold is the realization that open source doesn't have to be developed by traditional software companies. When open source will get really interesting is when you see insurance companies, banks, and other software dependent organizations making contributions to the community. There's a tremendous financial incentive to use open source software and to contribute innovations in that software back to the community.

what price freedom?

[Anonymous Coward]

good thing the original settlers of our great LANd weren't derailed by some 'payday' issue. know?

could be that IT would be better for everybody, if all the hobbyist whiners just folded their tattered tents, & just paid dupe their m$ liesenses? know?

just what if /. et al, folds into/under its bosses' stock swindle? that's IT? if y'all are that faint hearted, you should be selling shoes/m$ liesenses.

Tight Economy means using Open Source

[Jebediah21]

The software giant also persuaded Macchia that its system would cost 25 percent less initially and 42 percent less to maintain than comparable products from Sun or Oracle. So Aegis bought the Microsoft package, which is scheduled to start running the firm's 16 call centers sometime next year.
In a tight economy, "why would you spend extra dollars to get the same service?" Macchia asks.

Indeed. Why then would Mr. Macchia spend money on Microsoft products at all. Why spend extra dollars to get the same service in this tight economy.

I'm not sure what "high end business applications" the article is talking about, but Linux or *BSD may not be suited for it. However, if Macchia needed workstations for web browsing would he use Linux, or would he allow Microsoft to swoop in and offer 25% *giggles* off on Windows? This is a tight economy after all.

Article equates success with $$$

[mactari]

NEWFLASH! Open source projects aren't making money when commercial ventures aren't making money, therefore open source is fading!

The author of the article referenced here takes examples like VA Linux and says, "See, open source is on the way out." The point should be that times were so wild for a while there you could offer Free[dom] software and *still* make money.

Quoting a quote from the article:
"The development model of open-source software is wonderful. But let's not confuse a development model with a business model. Basic business principles were forgotten by some," said Turbolinux Chief Executive Ly-Huong Pham.
[end quote]

Mistaking open-source for a business model is exactly what this article does. The fact that open-source companies are struggling is not a good indicator that open source is "fading". That's like measuring the well-being of the Catholic Church by how much the Pope makes each year, after taxes, of course. *sigh*

Re:Article equates success with $$$

[Anonymous Coward]

Mistaking open-source for a business model is exactly what this article does.

What? "Open Source Software" as a bogo-trademark was always sold as a business model. For more information see tuxedo.org.

Now if you are talking about Free Software or collborative development models, that's another story. But don't try to rewrite history psuh the business model crap back on the nay-sayers. That concept was invented here.

What about education?

[jefferson]

The articles only talk about Open Source in terms of companies trying to make money from it. But education, specifically university CS departments, are both huge users and huge resources for the open source community, and will help keep it afloat in hard times.

Not having to buy licenses for much or all of the software on their un*x workstations saves departments huge amounts of money. Moreover, they can build workstations from commodity components. This allows them to provide more machines for students, and simultaneously exposes huge numbers of CS undergrads and grad students to free software.

Also, the dot-com bubble bursting caused CS graduate school enrollments to swell enormously. Grad schools have traditionally been places where much free software is born, as student researchers put their work out there for everyone to see.

The problem is that only a few schools really do research in user interfaces and similar areas that will advance free software in the mainstream. But in a lot of less visible areas: like the core-OS, distributed computing, networking, scientific computing, high-performance graphics, AI and robotics, free software will continue to progress and improve through universities. In the process the universities will continue to graduate students who are used to working with free software, and who will wonder why they should buy licenses for software when so much is available for free.

California dreaming...

[Anonymous Coward]

Ahh, the naivety of youth... it's so refreshing.

Then when your 30 reality wakes you up in the morning like a bag of quarters to the side of your head.

Re:California dreaming...

[geomon]

I was laid off ten years ago (when I was 30) and went out and started a company. I was doing okay, but the bills were racking up fast and I needed to stem the cash flow problem. I took a job that I have held ever since.

Where would I be had I kept the company going?

Who knows?

It might have panned out beautifully.

Risk can be a good thing.

If these people are willing to take a short-term risk and keep coding, they may actually be in a better position in the long term.

If you think that certainty comes with age, talk to me again in 10 years.

ATTN: Opera users

[Anonymous Coward]

cross-site scripting vulnerability

For those who don't want to read, here's the workaround:

Use the browser's features to disable the execution of JavaScript.

In addition, enable "Use cookies to trace password protected documents".

No patch currently available. Versions 5.02, 5.10, 5.11, 5.12 are affected on Win32 and version 5.00 is affected on Linux.

Distros on sale!

[Denor]

A lot of the linux companies are trying to win back customers with sales - why just the other day I was at the Debian homepage, and they were offering their free downloads half off!

It has to be said

[Anonymous Coward]

A LOT of open source companies were and are run by people who have no friggin' clue about running business, and are in effect just indulging their delusion that they'll "change the world" or even just make a profit. And thanks to IPOs in some cases, they're doing it with other peoples' money.

I've talked at length with several insiders at open source companies, including one person who was at VA Linux for over a year, and the horror stories I heard were amazing. Upper management micro-managing the hell out of things, marketing people without any background in the field or even the slightest hint of what "marketing" really means, etc. Not only do they have no idea what their business plan should be, as others have pointed out repeatedly, but they wouldn't have a prayer of executing a perfect plan if you handed it to them.

People this inept deserve to fail under capitalism, and the sooner they do the sooner the resources they're consuming (including highly talented programmers)can be used more effectively by someone else. I really hate to see any of my fellow programmers getting laid off, but in the long run it's good news for everyone.

John ELway, BSD & Open Source Hater

[Anonymous Coward]

John Elway writes *BSD is dying

Yet another crippling bombshell hit the beleaguered *BSD community when last month IDC confirmed that *BSD accounts for less than a fraction of 1 percent of all servers. Coming on the heels of the latest Netcraft survey which plainly states that *BSD has lost more market share, this news serves to reinforce what we've known all along. *BSD is collapsing in complete disarray, as further exemplified by failing dead last [sysadminmag.com] in the recent Sys Admin comprehensive networking test.

You don't need to be a Kreskin [amdest.com] to predict *BSD's future. The hand writing is on the wall: *BSD faces a bleak future. In fact there won't be any future at all for *BSD because *BSD is dying. Things are looking very bad for *BSD. As many of us are already aware, *BSD continues to lose market share. Red ink flows like a river of blood. FreeBSD is the most endangered of them all, having lost 93% of its core developers.

Let's keep to the facts and look at the numbers.

OpenBSD leader Theo states that there are 7000 users of OpenBSD. How many users of NetBSD are there? Let's see. The number of OpenBSD versus NetBSD posts on Usenet is roughly in ratio of 5 to 1. Therefore there are about 7000/5 = 1400 NetBSD users. BSD/OS posts on Usenet are about half of the volume of NetBSD posts. Therefore there are about 700 users of BSD/OS. A recent article put FreeBSD at about 80 percent of the *BSD market. Therefore there are (7000+1400+700)*4 = 36400 FreeBSD users. This is consistent with the number of FreeBSD Usenet posts.

Due to the troubles of Walnut Creek, abysmal sales and so on, FreeBSD went out of business and was taken over by BSDI who sell another troubled OS. Now BSDI is also dead, its corpse turned over to yet another charnel house.

All major surveys show that *BSD has steadily declined in market share. *BSD is very sick and its long term survival prospects are very dim. If *BSD is to survive at all it will be among OS hobbyist dabblers. *BSD continues to decay. Nothing short of a miracle could save it at this point in time. For all practical purposes, *BSD is dead.

FACT: *BSD is dying

Thanks!
Elway
Retired && Loving it!

Microsoft R & D

[Anonymous Coward]

Ransack and Destroy
Rubbish and Defication
Rule and Defend

More?

They were dot-coms

[karb]

Across every industry, the same thing is happening (or has already happened). For the most part, the upstarts that thought they could conquer the brick-and-mortars by being on the internet first have failed.

The brick-and-mortars that do the same thing but could afford to lose lots of money on the internet initially have survived. Commercial open source will survive, but pursued more by the old guard (like IBM, Apple, Sun, etc.).

95%? Get real!

[Anonymous Coward]

The majority of new businesses are either still in business after five years or sell out to a larger competitor.

Re:95%? Get real!

[alen]

I'm quoting figures given to me by an MBA from my last job. He said that around 80% of all new businesses fail in the first year. 90% within the first 2 years. And 95% within three years. The survivors are probably doing something right.

Re:95%? Get real!

[Arandir]

Hah! I guess you believed that line the VCs told you while they picked your pockets clean.

History proves the statistics: the vast majority of new business will not be around in five years. They make a good showing but can't sustain it in the long run.

Re:95%? Get real!

[JabberWokky]

The survivors are probably doing something right.

Possibly, but not necessarily. I've seen lots of very good, sensible, dedicated and well led companies die of bad luck (some of it obvious - a different product or big name competition jumped in, some of it not obvious at all). I've also seen plenty of broken as designed companies office-politck themselves across three years with little problem (often with a few big contracts or with a funder not giving up).

I *would* say that after a decade, the bad ones implode, but three years is still a short enough time for bad companies to survive (and even profit on paper, even though they are failing financially in the longer view).

--
Evan

weenIE boys

[Anonymous Coward]

We've offered significant amounts of time resource, etc..., to your so-called 'leaders', in order to promote to the gui based vast majority.

time & again, the reply: "we don't need any help (except with the swelling in our heads)", "you're not one of us (even though we can't agree on who we are, or what pupose we serve)'. "we don't like you (because we think we don't need help), (see also: swollen heads)", etc..... Now, ITs: "whaaaaaa, we need everybody's money if we're to survive, whaaaaa". we're tending to think that felonious father william had y'all pegged from the get go.

despite all that rant, what you do is imperative to the continuation of the free world, so, we're STILL here for you. you know who we are.

Faulty buisness models.

[Znork]

You do not _make_ money _selling_ opensource software.

You _save_ money by _using_ opensource software.

How hard is this concept to grasp?

These models are used in, for example, companies doing something else entirely, such as the auto industry, finance or research. The main goal is to reduce IT costs.

Other examples would be companies like IBM selling complete solutions based on opensource software, where the goal is to reduce your pricetag as compared to your competitors. A lot of the failures have been proprietary companies whos buisness is going the way of the dodo anyway, often because their products are competing directly with opensource products and the advantage their product offers above using the free, opensource, product just isnt worth their license fees. If, for example, your product will save a company 10 manweeks of programming as compared to just hacking something together in perl, you cannot charge $50000 for a license, because a) 10 manweeks dont cost that much even if the company hires a consultant and b) dealing with the friggin license manager is going to take half that time at least.

Sistina with its GFS is a perfect example. I mean, sure, I think it sounds great. However, with me being a sysadmin in a 80K employee company who could really use something like that, and even I cant see us migrating to something like GFS in the next 10 to 20 years, where are the customers? It doesnt matter if it's opensource or proprietary.

I mean, come on, it's hard to even create a reliable SAN solution that doesnt blow up in your face every week unless you have DMP _and_ host based mirroring, not to mention the complexities of ordinary various forms of filesharing, not to even try to attempt to get into the corporate politics that would be necesary to implement something like it. It aint gonna happen this decade.

On top of that they're competing with virtually every filesharing hack and strategy in existence. Great idea, but the product will require massive marketing to the right people to even have the slightest chance, and they'll have to target the ones who have an environment where the benefits are larger than the costs (um... clean-slate new 10k plus employee companies? Corporations whose datacenters have caught fire and they can reimplement it all from scratch? The migration pains for this make me shudder).

The same applies to the most of the other companies there. You can live off services if you have the marketshare, but you cant breathe new life in a product that faces killer competition already. The same applies for anyone going the other way. You cant make your product proprietary if it means your marketshare will hit ZERO the second you make the announcement because what you offer has no value. Linux distributions are a perfect example of that. Make it proprietary and you dont have any customers anymore, because you have annihilating competition and part of the value is that there isnt any friggin license hassle involved. You _have_ to have the marketshare to run on services and support or offer something of real value on and above what everyone else offers.

how about when you get laid off?

[hotani]

I got laid off from my job and found it to be a great time to put out a new version of my open source project. I completely rewrote the thing in about a week, being out of work is great for open source!

the truth is not what's important

[eramm]

In newspaper-land entertainment and scandal is more important than the truth. Hence no one cares what the truth is as long as there is a good guy and a bad guy that's enough. Even if the truth is the good guy is bad, and the perceived bad guy is good.

In our case saying all is wonderful in open source land doesn't get you mouse clicks. So you create a "scoop" and post it on yahoo.

Don't believe everything you read.

Re:Economics of Open Source - mod this up

[ab315]

good post

Slow paid-work times frees up time for OSD

[MarkWatson]

I had the experience of the dot com that I was working for (an AI company) going out of business earlier this year.

One good thing that happened was that for a few months I was not very busy doing paid work, so I had the chance to work on another Open Source project (Lisp wrapper for the Brill tagger) and to finally release the first version of a free web book (sequel to my published Java AI book).

Bad economic times and slow employment are a bummer, but Open Source projects can benefit from extra free time. (Beats watching network TV!).

-Mark

IT'S GOOD FOR OPENSOURCE !!

[stark_fist_05]

1. When I was out of work I could dedicate 40+ hours at a time to opensource development. Over 100 hours a week. now that I working I'm lucky to spend 20 hours a week.

2. If the economy is slow then companies should be looking for the most bang for the buck. Not, $1000-$5000 per seat in desktop licensing (and much more on servers). Smaller budgets make for smarter purchases due to increased research into value, reliability, and performance, The 3 areas where Linux and opensource dominate.

Depends on the job...

[Svartalf]

If you're a device driver or kernel developer, making web pages is nothing more than working at McDonalds to most of those kind of recruiters- why are you doing web coding instead of what you're applying for?

Let's face it, recruiters in boom times are a benefit- in the shallow times, they're not as useful to worse than useless (I'm getting interview opportunities for positions that people like Hall-Kinion are listing online and elsewhere but they apparently won't submit me because they're looking at the explicit request details and insisting on it (Recruiters are really bad about that in times like these...) even though it's a minor detail and non-critical to the actual work involved with the position- in order to get the interviews I've been doing a little research and applying for the positions directly. Times like these, if you're unemployed or getting screwed, you need to use the recruiters, but if you're not getting places, you need to use your OWN initiative.

That includes continuing to code to keep sharp and not sitting on your duff, expecting that a recruiter will place you.

Re:Depends on the job...

[NineNine]

Well, those of us who are professional contractors ONLY use recruiters. I know most of the better ones in my area, and they all tell me to take something off my resume if it isn't related to what I do. That's why I'm saying that a job at McDonald's or whatever in the meantime generally will hurt your chances of getting another job if you don't have one already.

Open source == subsidy

[MisterMo]

Open source is not a for-profit venture, but rather a subsidized activity.

Here's a gloss on what Webster (at dict.org) sez about the word "subsidy":

1. Support, aid, or cooperation; especially extraordinary aid in money rendered to the sovereign or to a friendly power.
   
2. A sum of money paid by one sovereign or nation to another to purchase the cooperation or the neutrality of such sovereign or nation in war.
   
3. A grant from the government, from a municipal corporation, or the like, to a private person or company to assist the establishment or support of an enterprise deemed advantageous to the public; a subvention, as in a subsidy to the owners of a line of ocean steamships.
   

Synonyms: Tribute or grant.
Usage: Subsidy, Tribute. A subsidy is voluntary; a tribute is exacted.

Each of these is interesting -- think of corporations as sovereign pseudo-states, and you can imagine many parallels.

One implication might be that source code is becoming a medium of exchange or a currency, rather than a form of speech!!

Don't be fooled - CmderTaco aint CmdrTaco

[Embedded Geek]

Take a look at CmderTaco and you will see a lot of -1's. He aint the real CmdrTaco, just an AC with an account.

Re:Don't be fooled - CmderTaco aint CmdrTaco

[Anonymous Coward]

Are you new to Slashdot?

Buying Stock

[Arandir]

Chasing after stock prices is a losing proposition. People forget that last year and dumped a whole bunch of money into a lot of losing propositions. Then they realized their mistake and sold, sold, sold. It doesn't take a genius to know why.

A stock a simple a share in a company. You own a piece of the company. It doesn't generate you any revenue. If the company is profitable it may offer you regular dividends. If you have stock in such a company (otherwise known as old boring brick-and-mortor companies) then hold on to the stock even if the price drops. On the other hand if the company is not profitable then don't even bother with it. The only way you'll make money is to sell the stock, driving the price down. Thus the more money people make on a stock the less viable the company becomes.

Take a look at the hottest stock of last century: IBM. Given the opportunity to purchase IBM stock in 1901 would you have done it? Looking at just the stock price though, you would have been much better off earning interest at a bank. Nobody ever made much money off of the IBM stock price. But a lot of people made money off of the dividends.

Next time you want to buy some stock in an Open Source company, ask yourself if the company is going to be around in five years. We all know that Open Source is going to be around in five years, but you're not buying stock in Open Source, you're buying stock in a specific Open Source company. If you can't envision that company becoming an old boring brick-and-mortor, then don't bother. Otherwise you're just trying to outguess the rest of the market.

Re:Buying Stock

[Anonymous Coward]

Actually, if you had bought IBM stock as recently as 1990 at $23 per share you would have done quite nicely, even without the dividends. The main reason for this is stock splits. IBM had 2 for 1 stock splits in 97 and 99.

Investing $1,000 in IBM in 1990 would make you $20,000 today, a return of a WHOPPING 2000% EXCLUDING DIVIDENDS!!!

Always remain fully invested in the stock market - it is your best move.

Re:Buying Stock

[ab315]

Unless you were in Japan in the 1980's, right?

From MSNBC article

[Anonymous Coward]

In a tight economy, "why would you spend extra dollars to get the same service?" Macchia asks.

Just wait pal. You'll find out why Oracle and Sun can get more cash. It won't be the same service.

Subscriptions and free software

[einhverfr]

Sure, subscriptions make a lot of sense, but software license subscriptions are a definite violation of the GPL....

Subscriptions are a good idea, but you have to look at how your market model works. Development of new features is paid for by those that need the features and bugfixes are paid for by support contracts (sort of bug insurance). These models are how the cost of development gets distributed.

Here are some possible subscriptions that could work:

1: Pay a nominal fee for access to a high-speed FTP site. (Red Hat does this)

2: Pay a nominal fee for regular software and security updates through simple interface.

3: Pay for a support contract.

Note that in all these cases, the products obtained through the subscription are still available after the subscription is terminated. This is like a conventional subscription and unlike the software for rental (aka MS) software subscriptions.

So what if most people don't give back? Those that need the services will have to invest in them. Why should I have to initially pay for Linux? In time and/or money? Why should my parents? Why should I pay for Apache if the current version suits my needs?

My point is that those who need more than is freely available can either develop it in-house or hire someone else to do it. That is how the cost is paid.

All this aside, I have noticed that beginners often eventually turn into developers, who may contribute their time to these projects. So free is not a bad thing.

Re:Subscriptions and free software

[reflective recursion]

Software subscriptions aren't a violation of the GPL. I'm not sure what you mean "license subscriptions," if the GPL is your license. If you pay upfront $45.99 for a 1 year software subscription to a GPL program and will obtain a CD every month full of bugfixes and new features, then that is _not_ a violation of the GPL. The person who receives the CD will be allowed to distribute _that cd_ at will (and modify the software). Nothing wrong there either. As copyright holder you are allowed to do anything you want with the source code--even sell patches for it by the month. Even people who patch _your_ programs can turn around and sell it. They are even allowed to have a monthly subscription type program for _your_ software. The only restriction the GPL places on the end-user is they are not allowed to restrict other's freedoms.

Re:Subscriptions and free software

[einhverfr]

Software license subscription refers to licensing software on a subscription basis-- when the subscription lapses, you no longer are supposed to run the software.

Re: EDS

[Anonymous Coward]

EDS is an interesting one, one of the first parasites living off open source. Back in the old days, the US government mandated that federal government-funded software would be open source, ie the taxpayers paid for it, they should be able to get a copy of it. EDS got government money to create software to make payments for Department of Agriculture, then for Medicare, and yet it never released its source codes, but turned them into very profitable proprietary systems. This was a great swindle (ie successful use of lawyers and political influence) of the taxpayers, producing for Perot an income of about $1 million per week for the next 20 years, back when that was real money. Should never have happened according to the intended results of the rules in effect. Before Perot, no one tried to make big bucks in software. IBM gave it away if you bought a computer, and business freely shared all kinds of codes without much selfishness of applications.

it's all about the benjamins baby!

[Anonymous Coward]

Open-source can either be a parasite or a symbiote with the capitalist economic system. Currently the best that has been done is the Red Hat model -- take GPL software (namely Linux), sell distributions, and renewable revenue is derived from customers paying for support. The structure of this is iffy at best.

Whoa

[skeptic]

Wall Street was threatened by this, so it blew it into a bubble in order to (1) take East Coast profits on it and (2) make it go away.

Good god man, that's one helluva conspiracy theory. Why didn't they (the East Coasters) just buy-out their opponents when the going was good (read: after they'd taken profits and the West Coasters went broke) and accumuluate the built-up capital for themselves? Then they'd have the money *and* the tools ...

As far as Microsoft doing well...

[Glock27]

I find this line quite suspect:

Sales of Unix-powered servers, sold by companies such as Sun, grew just 20 percent. Though Unix market share remained almost double that of Windows, Windows' market share rose to 22.7 percent from 20.7 percent.

I don't suppose anyone at ZdNet considered the many companies that have installed "roll your own" Linux servers (often removing Windows in the process)? I know our company has several. Its entirely possible that Unix/Linux marketshare has actually risen. Don't forget MacOS X either, which I'm sure Gartner missed in it's Unix box count. ;-)

There are lies, damn lies and statistics!- Mark Twain

Who makes $$$???

[Anonymous Coward]

By some estimates, Microsoft's net income is greater than 100% of the total net income for all software businesses. Running a software company is like running a little art shop in rural New England, buying a few racehorses, getting into oil drilling, producing phonograph records, or trying to strike it rich trading in the pork bellies market -- a way to squander savings. G'luck.

Microsoft least expensive...

[Anonymous Coward]

Microsoft is least expensive only when you get your figures from Microsoft. They of course will forget to add in the cost of doing business with Microsoft. Which is having close proprietary systems that require other systems to be moved to Microsoft in order for them to "cheaply" communicate. Which is Microsoft deciding that since they are in business to make money, any changes that break your current systems are just Microsoft's way of making money and are thus justified.

The Economics of Open Source

[DeadVulcan]

Many people have jumped on their soapboxes, proclaiming (yet again) that free software is not a business model. Yes, yes. You're all preaching to the choir.

I has the same impulse, but on second thought, I realized that economics can be applied to free software, and from a certain point of view, there is a business model there.

A Google search reveals all sorts of stuff on the web out there, none of which I've read, so what follows is an off-the-cuff personal opinion. Take it for what it's worth. (Not much.)

The product of free software is the algorithms, the code, the documentation; so-called intellectual property. The currency is a reputation among other coders, and the use of other free software products.

I'm bursting with things to say, but I have to get back to work (in the other business model), so I'll just say this:

In the free software world, quality counts more than in the business world. How fast is the algorithm? How flexible is the program? How well-written is the code? These are the things that geeks generally consider to be the "success" of a piece of software, and they are near-impossible to measure. The payment that programmers get for their work is equally (if not more) difficult to measure.

So I think there are economics happening. There are (implicit) business plans, (unspoken) mission statements, and (so-called) companies producing products for (a certain kind of) profit, for whom insufficient return will certainly lead to bankruptcy (of sorts).

So, a (financial) economic slowdown doesn't necessarily apply to free software, not because economics (in general) doesn't apply to free software, but because the goods being bartered are totally different, and not being tracked.

A final thought strikes me as I write this: free software is a new kind of underground market, and it's very large, so it seems only a matter of time before governments start asking for a piece of the action.

Then, we might have to come up with new ways of accounting for those intangible things that free software is about: the quality of code, the programmer's reputation... I don't know if that's even possible. As you can see, I'm thinking out loud here.

Urk! Gotta run!

Re:The Economics of Open Source

[monaco66]

You have your finger on it: Peter Drucker, the godfather of business management theory says this (paraphrasing):

A corporation makes shoes, for instance. It doesn't make 'money'. Money may or may not be part of the formula, but the fact that the company exists to give value to it's customers, that's it's purpose. As far as making money, that's what finanacial people think a company does, they are wrong, and that's why financial people will never understand the corporation.

Just because Open Source isn't making money for some people (even if it's not making money for _most_ people) doesn't mean it's not having a huge impact, that the impact has value. It may be small in terms of tracable monetary transactions, but it's large in terms of changing the world we live in.

IOW, Don't confuse size with impact, impact with profitability, profitability with value. A company can have huge profits and contribute little. A company can be hugely profitable and have little impact on the industry that its in.

The New New Economy

[scoove]

Some interesting points, though I disagree with many of them. Let me contribute a first-hand "I successfully funded a telecom company in this god-awful market" perspectives, sharing what worked and didn't for us and how it relates to open source:

The economy is in the shitter.

Yes, and even more so, big VC-funded entities. More on this in a sec.

This whole article is nearly pointless.
Yes, I found it very state-focused, static. Declaring the obvious, but totally missing the point and trend.

Open-source (the business model) was circling the drain before any other sector of industry

Open source, as a sole business focus in itself, was (especially when VC funded, again). Open source as a tool for the post-dotcomveeceedisaster, is actually growing stronger.

Because the high-flying VC money and gold-rush speculation that drove those fat boomtime salaries are what really paid for open-source.

I'd say you're half right. Look at my business: we're a rural broadband provider, up against a couple of VC creations. All of them are gasping for air, desparate for yet another round of money. Apparently $60+ million wasn't enough to pay the Lucent consultants and Harvard MBAs for a year.

Meanwhile, the lean and mean guerrilla companies like ours are growing (mostly because cashflow is easier when you don't have the $60 million monster to feed, not to mention all the VC opinions that come along and feel they have a right to tell you how to operate, who to hire, etc.).

not selling services to free products.

No, but consider open source as an element of (pardon the buzzword bingo word choice) "coopetition" (ack). Look at tools like MRTG, netsaint, netstumbler, etc. We're developing our own tools that will be released as well - they'll never be successfully understood by the VC and Fortune 1000 beasts (e.g. Qwest), since they "don't come from Lucent" and aren't backed by a big name firm.

Instead, we'll end up sharing with other guerrillas, each attacking the telecom beasts from a thousand locations. Once we've dealt with them, it'll be interesting to see how well we play together. I do believe we're seeing an interesting transition here though.

VC's had a few fundamental assumptions that the dot-bomb proved to be flawed, including:

o synergies: more is better. Compaq + HP > Compaq & HP. Economies of scale, leveraged buying, etc. We're finding out that Compaq + HP instead equals Compaq + HP + competing incompatible political structures, new focus on internal battles rather than fighting the outside enemy, balkanization, etc.

o startup + $100 million = a mature company: Why else would you hire a Harvard MBA - I've dealt with dozens of them and can attest to not a single one understanding startup dynamics. They're worse than useless - a bunch of British officers fighting the American revolutionary war. Wrong methods. Wrong scope. Wrong level of granularity applied to project/process management. Only good at spending money and getting out before things blow apart. But VCs thought the presence of $100+ million in funding made things post-startup (since startups don't typically have those kinds of financials!).

So what the hell does this have to do with open source?

The pure-play open source death being reported here and being discussed by underpaidISPTech is a VC anomoly - in south park language, a monkey with three asses. They weren't meant to survive; they were meant to have a high IPO exit that the VC would make a killing on. Everyone was part of that party, and the shills buying this stock finally figured out (dotbomb) and stopped playing.

But open source as a strategic tool for post-dotbomb companies is just beginning. Think about it: I've built mediation systems that are light years ahead of Lucent's Billdats (which comes with a $1.25 million+ pricetag, not including hardware or support) for the cost of Redhat, a $2,000 Pentium III and a week's worth of Perl programming by my team.

If you're in the tech world and want to end up a winner, you've got to read Christensen's Innovator's Dilemna and understand that open source, Linux and such are all disruptive, "trivial technologies." They may not be pure plays for a long time, or forever, but they probably are going to cause significant upheaval within industries.

BTW, in the post-dotbomb, there is compelling evidence that the "all companies must consolidate and get large or else die" may also be a fallacy, primarily created out of the SEC investment models that favor public market investment (and restrict private company investment out of antiquated investor "protection" laws, interestingly supported by... you guessed... large corporations seeking to tie up the capital markets).

Build a company that makes a profit. Don't worry about size. We'll see how this plays out...
*scoove*

Slump?

[cnladd]

Would this help explain the lack of stories since 9:44a? :)

it's all about the benjamins baby! [FULL TEXT]

[Anonymous Coward]

[last post incomplete, stupid IE at stupid 'net cafe somehow pressed 'submit' when I did a ctrl-M to check that I had infact spelt "benjamins" correctly]

ok, so, it's all about the economic model, right? the red hat model of selling distributions and relying on revenue from support is an unattractive industry structure.

i propose the following: all software can be broken down into one of two categories -- services or licenses.

by services, i mean web access, instant messaging, email, irc, etc. companies selling a service for a monthly fee can open-source (even GPL) their client, and pay employees for full-time active development, because in the end users still have to pay for the service. (think AOL developing mozilla because in the end it makes for a better web-browsing experience for the millions of AOL/TimeWarnerCable users out there -- and people still have to pay that $50/month for RoadRunner cable modem access.)

as for licenses, this covers software such as photoshop or office suites. nobody really buys a copy of photoshop unless they're in a business where they are legally liable if they don't purchase a license from Adobe to use it; and then they can probably afford the $600 cost. so, photoshop might as well be open-source (if not GPL, probably more like apple's open-source license), and adobe maintain a licensing scheme where it's free to download/compile if you're an individual/student. but if you're using it to make money, then you've gotta buy the $200/year license. this could be enforced by giving license numbers (which could be authenticated on adobe's web-site) for embedding in image data used in said business.

of course, i think this is where microsoft is heading with this whole .NET thing; only more evil. and you have to pay thousands of US dollars (or equivalent) to be a developer.

Not a good analogy

[einhverfr]

5-star restaurants are more like Sun, HP, etc. and proprietary Unix.

Microsoft is therefore like McDonalds. Not the quality, but not the cost either.

Open source is more like the culinary magazine market. Make their money giving away their recipies for free and selling the media.

Commodity and Monopoly

[Anonymous Coward]

Opening the code prevents a lock-in monopoly and it prevents one company from a winner-takes-all. All the investors who invested in companies expecting the "next Microsoft" got screwed because of their own perceptions, and for expecting usurious returns on their investments.

Furthermore, *after* a companies' products become successful, it's important to work with standards so that the base on which it was built becomes a real standard. Had Microsoft correctly identified that the underlying OS had become commoditized, it could have worked to get its base to become part of the standard. Instead, BSD won out. Apple selected BSD because it realized there was no more value-add in a commodity like the OS.

This is what will trump Microsoft eventually. They keep relying on a commodity for future revenue. If they could somehow turn parts of Microsoft Office into a platform that other people could use, then they could continue to provide value on top of it. If they're not careful, however, OpenOffice will come along and beat them to it, and those that base future extensions off the common base commodity will get more money for the value add.

Offtopic sig comment.

[charon_on_acheron]

Your sig asks a very important question:
"Can bin Laden get a fair trial? "

Very probably answer:
Corpses aren't put on trial.

Re: EDS

[mnf999]

Interesting.

I did not know the story behind EDS. It's a good one. Frankly $1m/week IS a lot of money, still today, it is real money despite your claims to the contrary.

In a way the current impact of OSS is poorly measured as it is an undoing of license as the primary source of revenue and frankly I am not sure it is a good thing. Not everywhere. What I mean by that is that many many business models succesfully operate on licenses. For end-user applications it makes sense. For infrastructure on the other hand it makes sense to use "public domain" software.

I don't aplaude for EDS, I just think that we now have a finer understanding for software, we understand it better. There are applications there is infrastructure, Open Source, sponsored by the govt should exist in the second sphere.

I am convinced that a natural business model for open source software is closer to the way top technology research programs operate. Sponsoring, conscious sponsoring through private investment and govt funding (NFS etc) is probably the way of the future.

The trick is going to be in balancing the need for $ motivation that was killed in academia, and the wild greed of VC bozos.

There is a middle ground.

marcf

I wonder ...

[bob_jenkins]

What if we allow companies stabilizing open source projects to disallow the copying of their stable releases, but require that they ship with modifiable code, and require that they return their bug fixes to the mainline? The companies still have a value-added product, customers can still fix bugs they find in those stable releases, and the mainline still gets all the bug fixes. A mainline that has moved on a bit plus all the bug fixes from a stabilized release is not as good as a stabilized release, because the product as a whole has not been tested.

consumers will not remain stupid forever

[Eugene O'Neil]

As an example, look at the mp3, CDR, DVD products out there. Is there a single product (game console, entertainment device or otherwise) that can play mp3s, read and write CDR, CDRW, DVD, DVD-ROM/RAM/RW and any other format? No. It is much better business sense to force the consumer to buy a couple of different devices than one do-it all device.

In other words, it makes "better business sense" to screw your customers than to give them a fair deal. That is only true for as long as you can get away with it.

When times are good, consumers are willing to waste their exess money on lots of little toys without worrying about how useful and practical they really are. Now that money is getting tighter, I think you can expect consumers to look a little closer at what they actually get for their money. They will demand products that are more useful, but less expensive. Companies that assume people will buy whatever they decide to sell will lose the market to companies that sell what people actually want to buy.

In the end, the customer is king.

You don't have to list McDonalds...

[Svartalf]

Uh, you just invalidated your claims there...

"I know most of the better ones in my area, and they all tell me to take something off my resume if it isn't related to what I do."

Do anything you can to get money in there, just take their advice and don't list it if it's not relevant.

Open Source is doing just fine, C|Net is clueless

[monaco66]

The title of the C|Net article should be changed to "Companies leveraging open-source approach as a revenue generating model fade in tough times", instead of "Open source fades in tough times"

They are confused: Open Source is bigger and better than ever. And it will continue to grow. C|Net is making the classic management mistake of confusing impact with profitability, profitablity with value. Here's a hint: "It's more profitable (for sellers of proprietary software) when things _don't_ work".

Remember, open source is about solving problems, about interoperability. When I want to solve a problem, I just do it. I don't need Microsoft's
permission, although they would like to change that. As much as I hate Microsoft, I still feel sorry for them when I see them fail to solve a
problem that E.F. Codd solved 30 years ago. Yet Microsoft would love to have the Internet to never go beyond MSN and TCP/IP be the idle dream of reseach scientists.

The Internet will continue to be the largest software development community in the world, contributing more to the computer industry than ever before. The most important, critical software you interact constantly with on the Internet is open source, based on open standards and open implementations, not Microsoft code.

Many companies, large and small, have made tons of money on open source. They will continue to do so if they know what's best for them.

OSS or not is irrelevant, open standards is

[wilhelm9]

All debates about Open Source as a concept is always making a mistake. They are always putting Open Source in one corner and commercial proprietary software in the other corner. This is a mistake. To be more precise, it is completely IRRELEVANT.

What is far more important is STANDARDS ADHERENCE. Good quality standard adhering product can be either Open Source or proprietary or may be characterized in any other way. In fact I have used both Microsoft and Open Source products which implement _public_ and _open_ standards well, just as both Microsoft and some Open Source projects make products that does not implement public and open standards.

Why is this important? Well for one thing, if there were an open standard defining what Word Processing documents should look like internally, I could use whatever product I liked best to manipulate my word processing files for me (note word processing files, not Word files). Competition among software companies would be improved, we would see more product alternatives that competed against each other.

In a wider view it is the lack of standards, and customers requiring them that is the driving force behind the profitability of Microsoft and similar companies. What methodology use to develop their software is not important.

If the IT industry would turn more towards standardized products we would be able to reap the benefits from both worlds.

NOTE: Maybe there is an open standard for word processing documents? I haven't heard of one but maybe a reader can enlighten me.

Economic slump

[Magius_AR]

Ever wonder if this is really as bad a slump as everyone is making it out to be?

I can't help but think people have also grown a little too used to the economy being in a state of "constant boom" to realize this "slump" could actually be ALOT worse.

Magius_AR

What if......

[ThaReetLad]

What if all software was open source? Who would pay a humble softie to ply his trade? Only those companies who wanted software to do a specific job that hadn't been done before,and was not core to their business. Where would the motivation for a company to produce something better than their competitors come from if their competitor could then distribute your software with their product?

What about software for software's own sake like games and word processors. OK so you want people to write OSS in their spare time, but where would they develop their skills in the first place, and what about those people who actually have a life beyond the PC desk?

OSS taken to its conclusion goes against the basic driving force of mankind since the we ceased to be a species of subsistance farmers when people realised that you don't have to grow your own food because you can pay someone to do it for you, if they then pay you to do something else. Like it or not hard cash is the means of exchange we currently choose to fairly compensate people for a fair days work.

Indeed

[nanun]

I seem to recall that not being able to afford unix was one of the things that sparked him to write the kernel.