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The Open Code Market
The Open Code Market
The peer reviewed magazine FirstMonday has published one paper I wrote on the business possibilities of Open Source titled "The Open Code Market".
In short, The Open Code Market aims to become a Free Market for software, as well as a market for Free Software. The OCM introduces into the Free/Open Source movement an economic incentive, to help align the priorities of Free/Open Source developers with those of the end users.
Between the final draft and publication, I received many valuable comments on the idea. I am very grateful to all those who dedicated some of their valuable time to read the paper and make insightful comments.
Some of those comments led me to an earlier similar effort by Brian Behlendorf named SourceXchange (originally at www.sourcexchange.com). After contacting Brian, his comments were probably the most valuable, since he had gone through the the actual proces of running a project similar to what I am proposing.
His main line was that:
a) while the market made profits, it did not reach the levels of profitability that were expected in the middle of the dot.com boom, and investors looked for other (more lucrative) endevours
b) That the dot.com boom also addedd costs (high salaries, etc) to his attempt and
c) that it is difficult to commoditise software creation due to the uncertainties over time / effort required to write the software, and the difficulty of the role of "project manager".
My line on all this is that
- The project may be easier to develop now as expectations for profits (and costs) have decreased, and that sourcing on low-cost countries (i.e. India, Vietnam, etc.) would reduce costs significantly.
- I also expect that the market will take off only as Free Software/Open Source (Linux in particular) moves to the mass market of the desktop, thus generating the necessary economies of scale, visibility and consumer-mass. In my idea, the target end-users of the market are not IT companies, but mainly individuals with no IT knowled (nor desire to acquire it) and Small and Medium Enterprises with small or no IT departments.
"
I think I see a new class split. The do-it-yourselfers that appreciate the quality and flexibility of open source vs. the people who just want a working computer without configuration woes. Guess which one will spawn the new millionairs and monarchs?
Always going forward, 'cause we can't find reverse.
I could see this kind of thing working as a try before you buy market - use the code and pay when you release the product.
-- "Can't sleep, clowns will eat me!"
try explaining the good side of open-source programs to people who have never written a program in their life... you'll see what I mean...
I can't see much revenue comming from ordinary computer users who would see this as a 'hacker's' network or something. where they should direct themselves is towards the programming communities and (mostly) businesses...
Did he mean the site didn't run with big losses and an unsustainable business plan?
.com boom.
I that was what was expected during the
The obvious answer is of course that the code can be seen and updated by the OSS community but IMHO most don't see the value in that and would rather stick with their own development team to do their work for them (think the Microsoft argument of having someone to fire).
My guess would be that it's effectively the same for them (since they could commission patches much the same as they could pay their programmers to update software) but again, management probably doesn't like it that they have to pay someone out of house to do it.
It's about time that someone created a method such as this to make the creation of open source code generate some funds for the programmer. If companies can see that keeping these programs open can be beneficial not only to them in the support of the OSS community but the the industry as a whole then I think everyone should be benefitted by something like this.
It's better to vote for what you want and not get it than to vote for what you don't want and get it.
- E. Debs
It sounds like you are proposing something akin to Experts-Exchange, but with a few differences. OCM would use real dollars, instead of points. OCM would also encourage the creation and reuse of code, not just answers to IT questions. OCM might incorporate private collaborative project spaces to help a shifting group of workers create commissioned code.
Two wrongs don't make a right, but three lefts do.
I'm working on an open-source location search (Mobilemaps) which aims to create a collaborative market for developers/portals using it.
The right service in this case is geotargeted advertising for local businesses wanting to gain some visibility on the net. It's an extension of a proven business model used by search engines like Google.
The plan is there's no need for developers to be paid for their code, they just earn money by participating in the advertising service by operating the location search for their local area.
Suppose right now today my company wants a custom feature or a bug fixed in some OS software. We can pull out our checkbook and hire X to do Y for $Z. If it's OS work, that's just part of our contract. AFAIK, this happens already.
So what is the innovation here? To create a "market" that is basically a consulting company for OS work? Doesn't seem to be...after all, the article specifically says this is not limited to GPL (and that didn't seem to be followed up with "or other open-source license"). It says open code, but does that mean the results must be open or simply the basis must be open and the end results can only link to open libraries if they are closed?
Or is it to create a consulting company that uses contractors? I don't believe that's it either... contract consulting work is already routinely outsourced and sub-contracted.
Or is it to organize a commercial venture based on the work of OS? This might be the real heart of the issue. There is where I get mixed:
Surely funded development of OS software advances them, but this could turn sour quickly (think Red Hat!). Now, with varied customers with individual requests I'd like to think that the market could not take on a direction with its own agenda, but I would like to hear some arguments for and against this. The model indicates this is for-profit. Thus, requests from the highest bidders would probably get preference. Supppose MS throws a few billion at time-consuming features that add little value to the product. Why wouldn't this market eat that up? But think about the cost of this. While developers add features such as scrollbars changing color through a gradient to indicate how far down you've scrolled, they are not working on fundamental issues that need to be addressed before they blow up in our faces. Suppose SCO hires a company to request a feature which would infringe on SCO's IP such that there is a genuine IP infringement that they don't appear to have set up directly.
I, for one, would rather have talented developers working on things like IPv6 implementation, that commercial investors probably won't want to fund, or at least wouldn't be able to compete with people who use the market as a tool against OS.
I think any time something this scale is set up, it should be very carefully critiqued. Unfortunately, there's nothing stopping anyone from doing it if it turns out to be a set-up for OS disasters.
The only thing more dangerous than a file named -rf is renaming it -rf\ /
Mark Pratt of Beehive, Germany, has relaunched the SourceXchange idea:
Open SourceXperts.com
Complete with the lame eX. It only launched on 10 November, so be gentle with yor 'how quiet here' comments.
"The truth shall make ye fret" -- The Truth, Terry Pratchett
Did anyone else read that as "dot dot com"?
Err, hello? RH desktop...dead. SUSE...wounded by Novell. SCO is bleeding any OSS-involved company with litigation. Who's going to take linux to the desktop or "mass market" as suggested here?
I'm not saying this guy is wrong, but the OSS world has got some damage control to do. I'm confident it will pull through (my paycheck depends on it) but I would rethink using this as a justification for this project's market readiness.
You never saw a fish on the wall with its mouth shut.
I would hope that OCM would be better than "try before you buy." I have reached a stage in life where I want products that do what I want them to do. I don't care to spend time trying software in a production environment because I find that so much of it is a waste of time.
OCM would seem to support the commissioning of software projects or modifications. Thus I could go the Market, submit a request (e.g., "I want a real-time transparent version of CVS") and various groups might make counter-offers of price and functionality. A bit of public interchange would would lead to a mutually agreeable specification and price. In some cases, the software provided might be off-the-shelf and in other cases it might be written from scratch.
As a venue for the commissioning and creation of software, I see OCM providing a valuable venue for both software creators and software consumers. Software consumers could aggregate to share the costs of new or modified software or form a mutual-support community around a given piece of software.
Two wrongs don't make a right, but three lefts do.
Market failure can also occur when people who have not paid cannot be prevented from consuming the good, a condition called nonexcludability. Public goods by definition exhibit both jointness of consumption and nonexcludability.
Ergo, it may be a resource, but it can't be called a market.
I believe that a project like this misses the point. As I see it, most Open Source developers do not write code because they want to Make The World A Better Place. Their motivation is not the satisfaction of users.
Programmers write code because that's what they love to do. This is why there are dozens of editors, mailers, etc, rather than a single well-maintained application of each type. A coder says to himself "I feel like writing yet another mp3 ripper GUI". He proceeds to do so despite the fact that numerous examples already exist because his motivation is his own pleasure, rather than a desire to fill some gap.
Trying create a carrot to dangle in front of these people is pointless. They don't want your carrot. They want to write the code that they want to write.
The OCM introduces into the Free/Open Source movement an economic incentive, to help align the priorities of Free/Open Source developers with those of the end users.
The one thing Microsoft has done well is focus on end users. They are able to hock woefully inferior file, database, and mail server solutions because they make sure that Word's macro engine can cook your breakfast for you if you want it to. If users want a feature, it will be in the release product - performance, stability, and security be damned.
I don't necessarily think we should follow MS in this regard. It doesn't seem to have really worked out for them. Let's focus on what is really attracting people to free software - choice.
who are those slashdot people? they swept over like Mongol-Tartars.
TopCoder Software has being doing what this article describes for over a year:
http://software.topcoder.com/
In short they are trying to put a structured, process-oriented community development model into a design / development competition format (with cash incentives, both upfront and as royalties) for creating new software. The resulting work is marketed as a component library, and the community itself is marketed as a "no-shore" development resource.
Check it out, it is a pretty good system -- the results are surprisingly good. I regularly participate in these projects.
+1 Perceptive
The communities are not separated. The high level of communication between developer, tester, and user is the greatest strength of OpenSource software. They are sometimes the same person! By introducing a "clearing house" you are adding a middleman and thereby reducing efficiency.
+1 Perceptive
This is a difficult problem. Really difficult - and essentially unsolved by traditional development models. OpenSource itself is a solution to this problem. Code reviews, while one of the most useful tools for preventing these problems, are also one of the most labor-intensive (read "expensive").
Here is a question I have had about open source code since taking a computer ethics course and also wondering whether we as computer professionals should be certified.
If company A is using an open source product and said product causes a customer of company A to lose millions of dollars whos is liable? Some may say company A is liable which may or may not be true, but lets remove company A now. Many businesses want someone to be "responsible" for the software they use. If that software is written inhouse or by a third party then the liability is obvious. If open source is used would you go to source forge (as an example) and get the user ids working on the project and sue them for liability? You see businesses can't just think about what is the best piece of written code, but also perhaps which piece of code will cover its backside the best. Is that the best situation? I do not know, but it is a situation that exists, why do you think major corporations and even small business owners have lawyers and liability insurance?
Sounds like he's proposing what I've already done, pubsoft.org. We take tenders for software, whether for entire new pieces of software, or improvements to existing software, and seek to put together developers and users. Multiple funding models are supported: matching grants, whole grants, or the Street Performer's Protocol. We've funded the up2us program (which never made it out because of the difficulty of tracking up2date development), and are currently funding FreeS/WAN, and GNU Radio.
-russ
Don't piss off The Angry Economist
This initiative is doomed to fail if they do not have very strong policies on IP. The GPL provides no guarantees on IP; for example, I could implement a patented algorithm and release it and users could get sued.
The article does not even mention the words "intellectual property." Something to consider!
"...a lemming is a little mole-like creature that once in a while commits a mass cuicide."
This article points out that lemmings "do not, however, commit mass suicide by leaping off cliffs, a myth compounded 45 years ago by Walt Disney's White Wilderness film - which showed lemmings apparently going to their doom."
I'm not sure about the overall fraction of open source, but I think that the majority of the most "popular and common" open source apps "just work." Here's some examples from my personal experience based upon what I use.
Everyday apps:
KDE - just works. Plenty of tweaking can be accomplished by right clicking or through the control center.
Mozilla - just works.
Evolution - just works.
OpenOffice.org - just works.
When you lose something irreplaceable, you don't mourn for the thing you lost, you mourn for yourself. - Harpo Marx