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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.
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.
Easy does it!
This comment has been submitted already, 276865 hours , 59 minutes ago. No need to try again.
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.
Helping with organizational effectiveness is our job.
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.
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.
Can all fish swim?
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.
XML is like violence. If it doesn't solve the problem, use more.
..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.
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.
What does nothing cost? Does nothing have a tangable asset value? What is the portfolio of nothing?
;)
/. ... but heck... who cares, right?
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
It isn't a lie if you belive it.
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??
Good quote, too many chars. Seriously, the slashdot 120 char limit sucks!
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.
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...
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*
It's all 0s and 1s. Or it's not.
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.
it's = "it is"; its = possessive. E.g., it's flapping its wings.
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
Here's a gloss on what Webster (at dict.org) sez about the word "subsidy":
- Support, aid, or cooperation; especially extraordinary aid in money rendered to the sovereign or to a friendly power.
- 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.
- 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!!
42
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.