The Open Source Business Model!
December 28, 1998
The ability of the OSS [Open Source Software] process to collect
and harness the collective IQ
of thousands of individuals across the Internet is simply amazing. More
importantly, OSS evangelization scales with the size of the Internet
much faster than our own evangelization efforts appear to scale.
- Microsoft Internal Policy Memorandum
As you can see, there is quite a range of successful free
software companies in the market today. There is also
quite a range in the degree to which these companies
adhere to the noble ideals of the free software movement.
Some companies, like
GNU and
Red Hat,
adhere closely to the ideals of the free software ideology.
Others, such as scriptics (as well as sendmail and ActiveState)
have as Tim O'Reilly notes, "explored hybrid models
which rely on [free software] ... for spreading the word,
fostering innovation, improving product quality, and
giving back to the community, but reserve certain products
as value added so that they can make money and survive to
further the cause."
Many more companies such as Netscape and Microsoft,
seem to adopt the model only when convenient to do so.
However, they implement the theories, these companies all provide
useful examples.
Because, the range of actual implementations of
the free software model is so broad, we found it
useful to adopt the more broad term of "Open Source"
which came into vogue in the mid 90s.
The Open Source Model and Free Software Model in theory
are synonymous. However, the term open source came to
be used to describe a larger set of companies which
did not adhere to all the qualities of a free software
company, but perhaps some or most of them.
Another reason we chose to adopt the term "open source"
was because the term "free software" tended to scare off
some people, especially investors and large clients.
Though "open source" was not necessarily the best term
to describe the
ideals of
free software, it did tend to be better for board room
discussions.
For these reasons we chose to call ourselves an open source
company although we continue to support the ideals set
forward by the Free Software Foundation and the free
software movement.
The Open Source Software Development Process
Recent case studies (the Internet) provide very dramatic evidence ...
that commercial quality can be achieved / exceeded by OSS projects.
- Microsoft Internal Policy Memorandum
As you can see, there
are many reasons why the open source business model works in the
information age market place. But, perhaps more importantly to clients,
the open source "software development" model also works.
The Open Source Software Development process produces
applications which equal or best applications produced in
closed environments.
Let's look at why this is...
Open Source is Robust Source
"It's a rare (and foolish) software outfit these days that does not
introduce its wares into the free economy as a
beta version in some fashion.
Releasing incomplete "buggy" products is not cost-cutting
desperation; it is the shrewdest way to complete a product when
your customers are smarter than you are." - Kevin Kelly New Rules
for the New Economy.
The open source model produces
extremely robust code. Think of it this way, our code has been
in the public domain at thousands of sites for years.
If there were serious bugs or security holes, they would
most certainly have been found by now. In fact, over the years
we have had many bugs and some security holes reported to us.
These bugs we have fixed over time so that by now, our applications
are extremely robust. Further, we have also had customers
send in improved or more efficient versions of algorithms.
Because the customer can see the inner workings, they can
help us look for code inefficiencies.
| Eric Raymond is one of the premier
supporters of Open Source Software Development. His site
at opensource.org
is a warehouse of useful information. He makes the following
case for the robustness of open source code...
"Internet and Unix hackers, as a rule,
already understand the technical case for open source quite
well. It's a central part of our engineering tradition, part
of our working method almost by instinct. It's how we made
the Internet work....We all know how astonishingly reliable
the running gears of the Internet are relative to their
nearest commercial equivalents.
TCP/IP,
DNS,
sendmail,
Perl,
Apache...these
open-source programs have demonstrated a level
of reliability and robustness under rapidly changing conditions
(including a huge and rapid increase in the Internet's size) that,
considered against the performance record of even the best
closed commercial software, is nothing short of
astonishing."
|
Open Source is Secure Source
"...The reason the closed source model doesn't work is that security -
breakers are a lot more motivated and persistent than good guys
(who have lots of other things to worry about). The bad guys will find
the holes whether source is open or closed.
Closed sources do three bad things. One: they create a false sense
of security. Two: they mean that the good guys will not find holes
and fix them. Three: they make it harder to distribute trustworthy
fixes when a hole is revealed." - Eric Raymond of
opensource.org
Eric sums it up pretty well. Open source ensures that your
code is submitted to the most
harsh and penetrating peer review possible. Such reviews include
bug checking,
security attacks,
and benchmarking.
What is better is the fact that the
people trying to over run your code are not hackers but customers! If a
bug is detected, it is usually detected by a friend first.
And, as Eric Raymond says, open or closed, the "bad guys" will
find the holes. The security through obscurity of closed
source is only an illusory veil of security. Security hole announcements
in such closed systems as Windows NT have been as regular as those
announced for open source code such as sendmail. The big difference
between the two lies in the emergency response time.
The rate at which security holes are patched in open source companies
is far shorter because the whole community can mobilize to deal
with any emergency.
Open Source Keeps a Company Small and Flexible
"If you give everyone source code, everyone becomes your engineer" -
John Gage, chief scientist at
Sun Microsystems.
We are where we are today only because of all the hard work that has come
out of the community of developers and users that has grown up around the
code. These developers have tirelessly sent in their ideas for fixes,
features and extension technologies. They have kept us close to
them and we have always kept our ears open.
The fact that the network of developers around the applications has been
so prolific is more than just gratifying, it is a crucial feature of
the model.
The fact is that we could never hope to hire enough talented people to
write all the code that this market will support. We could never afford
to find office space for them and we could never hope to get them all to
physically move from where they are to where we are. Even if we
could manage that, actually hiring all those developers would bloat us
into paralysis.
Fortunately, as Eric Raymond writes, "Even a small open-source
project can muster more
brains to improve a piece of software than most development shops can
possibly afford."
We know from experience that every line of code you write for
the community is returned many times over. The generosity
of open source development is certainly a form of enlightened
self interest. If you have a moment, check out some of the fabulous
"hacks" that have been
submitted back to us by the community.
Open Source is Market Driven
"In the network economy, producing and consuming fuse into a single
verb: prosuming" - Kevin Kelly New Rules for the New Economy
There is another benefit of bringing your clients into the development
process. You become extremely sensitive to the demands of the market.
There is no period of isolated research and development.
The customers can play with the code means that
they truly understand what is possible. They are the best source of
direction that we could imagine since they are actually using the code
to do work. And they, as a group of thousands, are endlessly,
24-7, demanding and inquisitive.
The Free Software Solution
Extropia.com: A Case Study in Open Source Software
The Extropia.com Approach
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