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The Business Value of Open Source Examined
jg21 writes "'Open source developers have the opportunity to influence technology that is being used by companies and do it on a global scale in a way that cannot occur with any other type of software,' contends Bill Claybrook, writing in the current issue of LinuxWorld. The article is a historical overview of the open source revolution, starting in the 80s with the GNU Project, BSD, and TCP/IP and then moving into the 90s with Red Hat, StarOffice, and coming right into the 21st century with the Ximian Desktop and Sun's Linux-based Sun Java Desktop System."
Who's altruistic? If we didn't have open source code to spend our free time on, we'd all be surfing your most excellent website instead. Being a sperm donor doesn't pay as much as some people earn working on open source.
Open source is built for fun mostly, not profit.
No weapon in the arsenals of the world is so formidable as the will and moral courage of free men.-Ronald Reagan
I want to get paid for my effort/time/expertise. I can't afford to be altruistic until I don't have to worry about making mortgage payments any more.
Some people do programming projects because they enjoy them, not everyone requires payment. Just like some people participate in sports for enjoyment (though in this country that is declining), not everyone requires a 10 mil salary just to play sports.
I think Google is a fantastic example. They use commoditized hardware and open source software. They built a better mousetrap in a world full of entrenched corporate behemoths.
The Next Big Thing will come from someone enterprising who can use the tools and open internet standards to create the next Google. You won't have to worry about selling licenses if that person is you.
Developing free open source programs will not make you rich, but if you develop something everyone uses, it will often get you name recognition in the industry. That name recognition can help you to land better-paying jobs than you might have otherwise had access to. Granted, the vast majority of open-source programmers remain relatively anonymous, but there is the possibility, especially if you create an entirely new project that does something useful and innovative.
Obviously, you probably still won't get the millions you could (emphasize COULD) get if you wrote it closed-source and patented it, but it's also much more likely to get wide distribution, and has a far greater chance of becoming the standard way of doing whatever it is it does, if it's open source and free.
Not that I'm advocating one choice over the other. What direction you decide to go depends entirely on your own situation, your tolerance for risk, and what you expect to gain from coding whatever project you're coding.
I have agree with some of the previous postings here, in that Free and Open software no longer exists in the "hobbyist space" - we have real technological and economic implications to deal with. The one thing that we should NEVER comprimise on is quality of the code produced, either to serve a certain company, standard or set of interests. Within a company, with closed projects, this ideal is most likely impossible. But it is this very same ideal that has made a lot of the high-profile projects into the high-quality pieces of software we recognize them as. So no matter how much we get pushed towards more business-like models/applications/environments, we need to keep the quality of code in these projects as high as possible. And in the end - we ALL come out ahead.
Welcome to the world of the corporate slave. If you only live to serve your mortgage, consider selling you house.
The reality is that chances are you wont ever write something that influences technology on a global scale. Maybe you are doing amazing stuff, but then I have to ask why got got a first post on slashdot.
Your outlook is valid, and open sourcing probably won't work for you. But it did work for Linus and Alan Cox and Andrew Tigwell (sp?) and a lot of other people. Linus in particular is worth a hell of a lot more now that he would be if he'd elected never to release his hard work as open source.
These are the highest profile examples, and of course there are shades of grey down to the little guy who never even submitted a bug report because he regard his time as too valuable to donate.
Norman Cook's Ode to Sl
A lot of OSS contributors are in full-time jobs on commercial projects and just work on OSS in spare time.
Others are probably university students working on programming papers for degrees.
A few maybe have sponsorship from their companies to work within OSS projects.
If you're a programmer who's motivated by money then fine, what's the problem? Go work in the commercial sector, get paid and pay the mortgage.
But please don't judge everyone else by your own standards - the OSS community is blessed with a great number of altruistic people who program for fame or just because they enjoy doing it.
Deal with it.
Gentoo Linux - another day, another USE flag.
Writing open source is a bit like writing a story for a fanzine -- it might not increase your bank account directly, but shows your level of expertise in your craft and gets your name out there. Showing a prospective employer a popular software widget you wrote is a pretty nice bonus for a resume.
That's not to say you can't sell something when the market is there, just that monetary benefits come in different forms.
People have been making comments like this on slashdot for as long as I can remember, and I have to wonder how many of them really get paid to write shrink-wrapped software. Statistically, it is a very small amount, with very many more writing in-house software. The thing is, for all of that large majority of software developers, open source software won't hurt you at all. The only people who will use your code are paying you up front to write it, so it's not like you need the copyright protection to allow you to make money selling it. The code you are writing is probably very tailored to the specific needs of your employer and so "the competition" really wouldn't be helped much by having access to it. In most cases your code might as well be open source, and wouldn't make any difference whatsoever to the business model which is feeding you and paying your mortgage. If anything, having the common bits - things you would otherwise license from a third party - open source will just make your life easier.
And if you really want to, you can make money directly writing open source software as well. It isn't easy, and you have to be something of an entrepreneur. But it certainly can be done, and from what I can see, the people doing it are living thier dreams, and are being compensated quite well for it. If you don't want that sort of risk, than shrink wrapped software isn't really the place to be anyway. Trying to make it big creating the next killer app is just as hard, if not harder, than creating a career around OSS programing. If you want to change the world, it will be a risky no matter how go about it - that's just life. If you want a stable job, those are going to be in IT and they will only gain from open source software.
So you write it, and it works, but you dont want to maintain it, and no one else in the company can, although they need it!
Release it as open source - the payback is that you get to use the program, well maintained and all, even after the developer has moved to higher places, be he engineer or student on day-release.
Sent from my ASR33 using ASCII
I think it's about 5-10 years early to start calling Red Hat "successful".
By whose standards are you judging success?
Are they unbelievably rich? No, and probably never will be. However, they've so far weathered the DotBomb era, are making money on something relatively new, can pay thier debts and still have the most recognisable commercial brand in OSS. They're also growing in size and sales. I'd say thy're a success so far, YMMV.
I agree that it will be 5 to 10 years before they "make it big" like Oracle or Veritas. I don't tink comparing thier monetary success to Microsoft is a wise thing to do - someone creating an OS monopoly will never happen again. IMHO, Microsoft has set the bar way too high for other companies to live up to.
Soko
"Depression is merely anger without enthusiasm." - Anonymous
They are giving something away for free that kills another persons livehood. Of cause, someone else is making something free that kills their own livehood as well.
That is bullshit. I get payed to implement proprietary business logic. However, all the tools I use are open source. No one is killing my livelyhood by writing better open source tools, and neither am I for contributing back to such tools. And no open source software will ever implement the kind of proprietary business logic I implement. Nothing to see here, move along...
Exactly. Why is everyone concerned with the business side of the SOFTWARE INDUSTRY? Most people, even in the IT field, are making money (or making their employer money) with the USE of software, not its creation. Software vendor profits, revenues, are almost NOTHING compared to those that USE software. The companies which use the software can support open source. Independent Software Vendors are not necessary, and do not make even a reasonable percentage of the profits made off of software.
Here is an example of the difference in scale:
A business pays $100K for software and makes $10M in profit on it. Or a smaller business makes $10K using a $100 software package. Or a huge business (think telecom giant) makes $10 Billion using $100M software. Those are 100:1 ratios. Those are not unreasonable.
Sometimes I think these business focused articles are written by and/or geared to software companies. There are other parts of the economy and even the IT industry.
Software companies are a small part of the IT industry and the IT industry is only a fraction of the economy as a whole. I am not saying the IT industry or the software company sector is small in and of itself, just that it is small compared to the economy as a whole.
Just compare everything to the GDP (which is huge) and you'll see. Just look at how many people and business USE software versus those that write it.
Our focus should be on those.
Just because it CAN be done, doesn't mean it should!
My current favorite free software project is readline. It's 146k, and it's the best thing I've seen for getting text from the user. I'm only sorry that it only has a termcap interface, because that means that it's painful to type anything in a GUI.
It also has an insane range of features. It has keyboard macros, custom keymaps, four kinds of history search, application-specific tab completion, etc. If you don't like how backspace works, you can switch it to a bunch of different things.
If Microsoft had been keeping up with the state of the art, you could hit the up arrow in the IP address entry boxes to get IP addresses you've used recently, or hit ctrl-R to search backward through them for matches against the pattern you remember.
"I assume the social goals are reducing crime, homelessness, poverty, etc. What social goals can you achieve through an operating system? This goes for Microsoft as well. Seems a little overreaching."
How about making computing available to as many people as possible even the poor. I guess that's not a good enough goal for you. There is an entire world for whom a $100.00 for an operating system is a half years salary.
"Does it offer the promise or deliver on it?"
Time will tell. So far it seems to deliver it for many companies.
"I'm beginning to decry standards. With standards you wouldn't get the giraffe or the duck-billed platypus. OS should evolve."
Standard are not laws. Nobody is going to break your legs if you don't obey the standards. MS routinely ignores standards and nobody has locked up Bill gates. Having said that companies like standards. It means they are not locked to one vendor.
"So the guy who came up with Internet Explorer doesn't influence technology?"
Of course not. IE was a me too product.
evil is as evil does
I have contributed in small ways to several OSS projects, and all of them were enhancements to things I already used, and wanted particular functionality in. With one exception (something I worked on as a student), all were done on work time.
Just because it's OSS, you're not necessarily working for free...
My company pays me to improve the OSS tools we use for development, and I release my changes to the main project once they're done.
The argument I make for releasing the changes (none of them are licensed to require it) is that other people can maintain my changes and check for mistakes I might have made. Otherwise I'll have to keep updating my changes to match other development, which would cost my company more $$.
"The Business and Economics of Linux and Open Source" by Martin Fink provides a much better prospective on the subject.
So here's my problem with Open Source from a business prospective. The same issue applies to a variety of industries, not just software, but open source software is a particularly good example.
I've heard claims that the best developers are as much as a thousand times more productive than the worse developers. Open Source might actually prove that contention; all of open source seems to be the contribution of a relatively small group of highly productive developers.
I also believe it because I've seen for myself the difficulty of scaling up a successful development organization. It's usually a case of diminishing returns as you add more staff.
This applies to any industries where a small group of highly skilled super-contributors can add a tremendous amount of value to a company.
So what is the long-term value of a company if the reality is that there is a relatively small group of super-contributors that actually add most of the value? What happens to the value of the company if that group leaves?
This is not an argument for close source. Unless you're an uber-profitable company that can afford to use nuisance tactics to protect your market share, some group of super-contributors will clone your success eventually even without violating your IP rights. Particularly given the relatively low capital requirements of a software start-up.
I've heard concerns that Google will suffer when many of its long-term super-contributors find themselves suddenly able to cash out and retire. How many dot-coms seem to have evaporated overnight shortly after their super-contributors were able to cash out?
So given that indentured servitude is still illegal in most developed countries. How do companies build long-term value of the form that venture capitalists and long-term shareholders are willing to invest in?
The code you are writing is probably very tailored to the specific needs of your employer and so "the competition" really wouldn't be helped much by having access to it
What absolute bollocks. The only thing that seperates even a service based software house from it's competitors is time to implement and quality of implementation. If a company does well in the, say, taxation market because it has developed a suit of well tested libraries it can rapidly redeploy in various situations, it has a significant edge of it's competitors. Start giving away your competative edge and you might as well call yourself a charity. Do you really think that if my employer was Nokia then Samsung wouldn't benefit commercially from knowing the code to the software I write? This might be true with very _very_ generic libraries like xml parsing...but that's about it!
If you look into the open source hype at the moment, you'll find that all of the major players that are pushing it (sun, ibm etc), make their money from hardware...can you, as a developer, start building new processors in your backyard to compete with these guys? No, so they'll continue to take your free software and laugh behind your back.
If you only live to eat, consider dying of starvation.
About 99% of Slashdot readers are corporate slaves, not living off the land. Have you ever told your Boss to Fuck-off when you get angry? Unless you're independently wealthy or live in your parent's basement, you do what your Boss tells you, like all the other little slaves.
Some people do programming projects because they enjoy them, not everyone requires payment. Just like some people participate in sports for enjoyment (though in this country that is declining), not everyone requires a 10 mil salary just to play sports.
I wish more people would think this way. Do what you love, and if you get paid for it, great! But those that are motivated by money alone usually reflect it in their work (i.e. Microsoft).
TCP/IP was originally designed and built in a University environment to loose specifications given by the Military. All TCP/IP derives from BSD Unix which is Open Source. Most (if not all) implementations are based upon the BSD code.
Yes TCP/IP is everything to do with Open Source and by the way Open Standards.
So I guess that's why the vast majority of profit comes from open source software, and companies like MS haven't been able to make any money. You know, due to having to hire a bunch of smart people, having competitors, etc.
I think the problem is that people assume that if you have a few quarters of profit, you're a successful company. You're minimally successful when the amount of profit made exceeds the amount of investment that has been made over the life of the company. Of course this minimal requirement is still less profitable then a simple savings account would have been.