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Open Source Software Licenses Versus Business Models
dp619 writes "Network World is running a guest article by Outercurve Foundation's technical director Stephen Walli discussing how FOSS license choice can affect a company's business model. Walli disagrees that a FOSS license dictates the business model or that the business model dictates the license."
If you look at the businesses that have succeeded using FOSS every. single. one. has used one of the "blessed three" business models, selling support, selling hardware, holding out a tin cup.
This is why for example no matter how many game engines are given to the FOSS community you will NEVER see a great single player masterpiece like Bioshock come from the FOSS community, because games do not fall under the blessed three and therefor they simply can't get enough funding to keep the doors open. This is also why we'll see Canonical close their doors in 3 years or less, they have already moved to the tin cup model after trying both support (Ubuntu One, Ubuntu Server) and selling hardware (Ubuntu TV, Ubuntu Tablet) but desktop OSes don't fit under the blessed three so they simply don't have a chance.
This isn't saying that FOSS can't be successful, look at Red Hat, but your business needs to fall under the blessed three to succeed. The reason why is obvious, if anybody can make infinite copies and give them away you simply have to have some other way of making money. Personally I think there needs to be a subset of GPL with no redistribution clause so we can get things like games and software for home users that don't fit under the blessed three as without the redistribution clause the "printer story" that gave birth to the GPL would still be solved, but its so ingrained now I doubt you could ever get it to take off. So in the end stick to the blessed three if you are going FOSS or you'll end up like Xandros, Linspire, Mandriva, Loki, and soon Canonical.
ACs don't waste your time replying, your posts are never seen by me.
If you look at the businesses that have succeeded using FOSS every. single. one. has used one of the "blessed three" business models, selling support, selling hardware, holding out a tin cup.
Google.
So is there a 4th model - selling targeted advertising? Or is this just selling support where the customer is an advertiser rather than a user?
But seriously, I always think "didn't open source cause software engineers and developers" to live a poor or at least not so good life?
I have developed software for 28 years (freelance, my small company, as an employee of another company) . I have created hundreds of small and sometimes large software, been team member of huge projects (core banking), created websites with millions of members ...
After 4x years of life, with a recent PhD I am living a miserable life (compared to my friends which work in construction and civil engineering, medical fields etc.).
I have always been abused by clients who compared my prices with free software, those who threatened to use open source free alternatives, those who thought software should not be expensive if not free, and those who thought a 100MB software can be stored on a single $0.1 CD and is nothing and last but not least relatives who thought installing windows and other software on their PC is a small favor (as if my time is free like free open source).
We software people did it to ourselves. Professionals in other fields never did that. No civil engineer or architect would design building for you for free.
Business CEO's are Gay, 99.9%.
For some reason I get the feeling that this AC is talking out of first-hand experience here!
After 4x years of life, with a recent PhD I am living a miserable life
You're doing it wrong.
Linux IT pros in US saw a giant salary leap in 2012
IT professionals enjoyed their biggest salary jump in more than a decade last year, but for those using Linux, it was even better.
Following up on its January 2012 study that found tech salaries had finally started to climb again, IT careers site Dice today published an annual update showing not just a continuing trend in that respect, but also a huge boost for those in the Linux field.
http://www.computerworlduk.com/news/careers/3422018/us-linux-it-pros-saw-giant-salary-leap-in-2012/
"I've got more toys than Teruhisa Kitahara."
You are both correct and incorrect. I have a couple of friends who are architects. The reuse major structural elements, design elements etc.. They also come up with new stuff, so yes and no.
Hey KID! Yeah you, get the fuck off my lawn!
Selling units works well in the short term, and you can make huge profits on something that costs nothing per additional unit to produce.
On the other hand, once purchased they have no further need for you, and unlike physical goods, software does not wear out or become damaged over time, you can always install a new pristine copy from your original media. You can try selling upgrades which offer new functionality, but sooner or later the users will have all the functionality they need and won't want your upgrades.
Software will gradually become commoditised, market by market until its impossible to sell anything. On the other hand, companies and end users will always want customisations and support, be willing to pay for them but unable to perform those functions themselves.
If anything, the model of off-the-shelf software is very bad for business, i have seen countless businesses which adapt their business practices to revolve around how the software they bought does thing. It should be the other way round, software should compliment the way *your* business runs, not force it to conform with what a developer half way round the world thinks a business should do.
Steam doesn't really come into it because all of their software is for entertainment, an entirely luxury service that noone depends on and which inherently does become "worn" as you complete the game and become bored of it.
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Others have mentioned google. There is yet another model. Having customers pay for features to be developed and implemented is one that for instance PowerDNS uses. The sixth model is using a "free" version that is essentially the same as the paid version, minus a few features. Wine is the free version of a commercial product, Atlassian sells most if not all of their products this way, or as a hybrid where you pay almost nothing for a small number of users but only start paying once you outgrow the limited user license. MySQL used to work this way, I'm sure there are plenty of others as well.
Evidently, there are still creative ways to make money out of FOSS if it's your business to be making it. They may not be used by the (vast) majority of companies in this business, but they do exist and have proven to be successful.
I was promised a flying car. Where is my flying car?
The examples in the article are pieces of software that are distributed in the hundreds of millions of copies. Things might look different if you produce software that is even slightly specialized. It's no cheaper to make special-purpose software, but your customer base shrinks exponentially with the degree of specialization.
Google was selling ads way before they got involved in any FOSS. Ads on the internet is their business. Gmail, maps, and Android are interchangeable methods. The business model is to put ads on internet SaS.
What Google shows is that FOSS can be effectively used, and even developed, by companies that have business models unrelated to FOSS. Similarly, a grocery store might increase sales by 1% by oferring delivery. They'd still be in the grocery business, not the transportation business.