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BBC Examines Open Source Business Model 140

Posted by ScuttleMonkey from the anything-to-turn-a-buck dept.
twitter writes "The BBC's David Reid attended Euro OSCon in Amsterdam and reports what he learned about the Open Source Model. He sums up the rise of non free software in the 1980s and how people and companies like IBM can make money with free software. From the article: 'The open source movement does not object to making money. The source code may be free, but there is gold in software support, training and publishing.'"
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BBC Examines Open Source Business Model More

BBC Examines Open Source Business Model

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  • Money in support?? (Score:4, Insightful)

    by Jason1729 ( 561790 ) on Monday November 07, 2005 @12:39AM (#13967031)
    Do you really want to use software built on a model of the software is free but you pay for support?

    There would be a huge incentive to make software hard to use, buggy, etc.
    • Which is why the people writing the software and the people selling the support are usually not the same. Also, selling software that you need a lot of support for will just encourage people to switch to someone else.
      • You've never dealt with Peoplesoft, Oracle or IBM.

        Or that most of the "enterprise software" industry charges 20% of initial purchase price each year for ongoing support.

        It is the way the market works now. it's not the way the market should work.

        • Re:Obviously (Score:3, Insightful)

          by spuzzzzzzz ( 807185 )
          But is that relevant in the context of this article? If the software they were selling was open, you could buy support from whoever you wanted. This destroys the incentive to produce buggy software because the writer of the software never knows whether they will be the one paid to fix it.
          • This destroys the incentive to produce buggy software because the writer of the software never knows whether they will be the one paid to fix it.

            Why would the writer of the software release it to the public at all if that were the case?

    • Re:Money in support?? (Score:5, Informative)

      by Russ Nelson ( 33911 ) <slashdot@russnelson.com> on Monday November 07, 2005 @12:56AM (#13967112) Homepage
      The parent of this isn't a troll. If it's a troll, then Keith Bostic has also been trolling over the years, and I doubt that. Yes, it does appear that there is a tension between having to do a good enough job that people like your software, but a lousy enough job that people need to buy your services. But, really, I haven't gotten all THAT much business through bugfixing. Most of my business has come from people with different requirements, e.g. it does X; that's great, but we need it to do Y on the Z platform.

      For example, I had a packet driver customer who wanted to put packet drivers into an air traffic control system, but he needed to detect hardware transmission errors so that he could log hardware failure. I had another customer who was building special Ethernet hardware for operating rooms, and the existing packet driver needed changes relative to network connection detection.

      The worst business I've had has been bug fixes, because, damnit, if I could have fixed the bug in the first place, I would have!
      -russ

    • Parent is NOT troll (Score:2, Insightful)

      by Anonymous Coward
      Parent should not be modded "Troll". He brings up a valid point: if someone offered me a free car and said they would offer "service and support" for a fee, I would immediatly assume the car must be prone to having problems.

      It's similar to a week or so ago when an article on slashdot brought up Microsoft entering the anti-virus/security market. It seems like a conflict of interest when part (or all) of your revenue comes from fixing your own company's mistakes.

      With that said, I am still an avid supporter

      • Re:Parent is NOT troll (Score:5, Insightful)

        by LDoggg_ ( 659725 ) on Monday November 07, 2005 @01:25AM (#13967242) Homepage
        Parent should not be modded "Troll". He brings up a valid point: if someone offered me a free car and said they would offer "service and support" for a fee, I would immediatly assume the car must be prone to having problems.

        The problem with that analogy is that support is never free. Vendors of proprietary closed source software also charge for service and support.

        • Re:Parent is NOT troll (Score:5, Funny)

          by mattjb0010 ( 724744 ) on Monday November 07, 2005 @04:23AM (#13967857) Homepage
          The problem with that analogy is that support is never free.

          Tell that to my Mum.
        • No wonder M$ is so borked, in general, when you think about it that way, is it?

        • Re:Parent is NOT troll (Score:1, Insightful)

          by Anonymous Coward
          A better car analogy is that you can't actually buy a basic car - they all have Value Added Features (rear window wipers, electric this or that, fancy engine-mamnagement systems, etc.

          You *can* get a "free" car with a support package: it's called Lease/Hire: you go in, put down a initial payment, and then a monthly fee.. and all your non-consumable stuff is covered..

          (let's face it, OSS support model does not cover you for hardware upgrades, replacement paper/tonor/ink, etc. - the OSS support model fixes the
      • Parent's post is my main beef with Linux. Linux to this day is not a plug and play solution the way Windows or Mac OSX is. It takes more manual labor to get things set up right, and it's too easy to break a program and not know how you broke it. This provides the foundation from which the "support" part of the open-source movement comes from.

        For instance, I have had a Windows PC since around 1998. I have never ever had to actually call a support line on software issues other than problems registering sh
        • Parent's post is my main beef with Linux. Linux to this day is not a plug and play solution the way Windows or Mac OSX is.

          Windows and OSX are only "plug and play" for simple (and/or trivial) systems. In many read world situations expecting a "plug and play" or "off the shelf" thing is an exercise for fools only.

          It takes more manual labor to get things set up right, and it's too easy to break a program and not know how you broke it.

          A situation non uncommon with proprietary software. There can also be a
        • and it's too easy to break a program and not know how you broke it.

          I get this problem with _all_ systems. The difference is that (as a techie) it's easier for me to debug a problem under linux because I don't have to deal with a black box where it's impossible to see what's going on in the middle. Very often with closed systems, if something breaks there's very little you can do to debug it and you probably end up wiping the system and starting from scratch.

          For instance, I have had a Windows PC since arou

    • Re:Money in support?? (Score:2, Interesting)

      by zaaj ( 678276 )
      I don't know about that - think about it this way - if you write excellent code, and can sell support contracts for a product that has few if any flaws, (such as to corporate types who need that warm fuzzy of a finger to point if something goes wrong, even if it's unlikely to do so) you get your money for very little work, after you cover your initial development costs.
    • It would still be less profitable that the common business model of kicking software out the door before it's time and making money off of support.

      I don't think that it's done intentionally, but it's a reality.
      • Oh, I've seen that done for open source work, too. I've actually ripped out and replaced some big chunks of very strange open source work that people had done with the hottest greatest thing since sliced bread, because it simply wasn't stable or up to the load. Replacing a Qmail/LDAP server with Sendmail/NIS some years ago was the classic one, because while the new nifty stuff had some cute futures it simply wasn't ready to hold up under the load of the older software.

    • Re:Money in support?? (Score:4, Insightful)

      by Sir Runcible Spoon ( 143210 ) on Monday November 07, 2005 @04:05AM (#13967804)

        Do you really want to use software built on a model of the software is free but you pay for support?

      Why not? If you don't like the support you are getting, move elsewhere. There is little to stop you with open source. And when you had all the support you need - stop paying. These are often no even options with closed source.


      There would be a huge incentive to make software hard to use, buggy, etc.

      I don't think you will find it works this way with open source. The guys writing the stuff do so because they are also using it (you have got to pay your bills after all). And if you don't fix it someone else will.
    • AND
      My all life rant with Open Source software is...

      I studied 5 years to have a Software Engineering major, with specialization in Software developing.

      I specifically DID NOT a career related to CUSTOMER SERVICES and whatever. Now, a bunch of people is telling me to give away my software for FREE and charge for "SERVICES".

      I know how to do GREAT QUALITY SOFTWARE. I know how to systematize processes, I know how to detect bottleneck processes in systems and how to help a company process using computing technolog
      • The problem with the grandparent poster is that it did not adequately explain what is meant by `support.' If `support' is defined as meaning answering telephones and helping customers do things, then this is not a good thing to be funding development. If `support' means adding new features, fixing bugs, and general customisation, then it sounds like exactly what you are qualified for.

        Most off-the-shelf software doesn't fit the needs of the customers 100%. With proprietary software, customisation (suppor

      • I specifically DID NOT a career related to CUSTOMER SERVICES and whatever. Now, a bunch of people is telling me to give away my software for FREE and charge for "SERVICES".

        No one is telling you to do anything. However, quite a few people are giving software away for free, and it's pretty hard to compete with free. Therefore, a lot of people are thinking about how to get income without relying on licensing costs, and are saying that this is one possible way of doing so.

        I know how to do GREAT QUALITY S

      • "What I DO NOT KNOW how to do is to answer telephones and say 'HELLO, CUSTOMER SUPPORT SERVICE'..."
        Seems like you have it down pat.

        Seriously though, if you think of yourself as some cog in a machine only able to do one thing (write software) then you're going to get treated as just that: an inflexible, inadaptable cog. I fear for your job security if you have exactly one skill.

    • Re:Money in support?? (Score:2, Insightful)

      by Jonti ( 795505 )
      But if you can "try-before-you-buy" (so to speak, you know what I'm getting at) *why* exactly would anyone choose to use a buggy and hard-to-use product in the first place?

      I think we should be told!

    • Re:Money in support?? (Score:2, Insightful)

      by ajs318 ( 655362 )
      If you know that other people could make money supporting your buggy software, it strongly disincentivises you to make it buggy in the first place. The only time there is money to be made out of bad software is when the only people who can support that software are chosen by you. This is how the closed-source software industry works.

      If there is a piece of software that people would like to be able to know does its job properly, but those people are not in a position to be able to determine for themselve
    • You assume commercial vendors aren't already using the same model, except they expect you to pay for the box up front too.

  • Thar be gold! (Score:5, Insightful)

    by Anonymous Coward on Monday November 07, 2005 @12:39AM (#13967036)
    There's also gold in the software customization market, like a VAR would in the propriatary market.

    Being able to take a free foundation and tailor it perfectly for your business model is much better than trying to wrap your company around a canned, closed source solution.

    Whats good for the customer is good for the consultant.

    • Re:Thar be gold! (Score:4, Interesting)

      by QuantumG ( 50515 ) <qg@biodome.org> on Monday November 07, 2005 @12:57AM (#13967116) Homepage Journal
      Friend of mine works for a megacorp in a non-IT field. They get all their software developed in Malaysia and no-one else in the corporation has access to the source code. So whenever they need some small customization they do shit like screen scraping and dodgee Visual Basic hacks. If they ask for a customization or a bugfix from the development team they won't get it for 6 to 12 months, if they get it all, and it won't do everything they need.

      So yeah, next time you try to tell someone about the benefits of Open Source, consider the fact that most consultants in their own god damn company don't have access to custom developed software.

    • Re:Thar be gold! (Score:3, Interesting)

      by dido ( 9125 )

      Having worked in this business for three years, and being the CTO of a small company in the Third World actually doing it, I can see a bit of a problem with it.

      While I cannot deny that it's a profitable business, it's not profitable enough to make most people engaged in it very wealthy. The main problem boils down to the fact that it doesn't scale very well. The only way to grow this kind of business would be to get more clients to do custom work for, and pretty soon, you wind up getting lots and lots o

      • "While I cannot deny that it's a profitable business, it's not profitable enough to make most people engaged in it very wealthy."

        Is there something wrong with that? Isn't it enough simply to be wealthy or somewhat wealthy or even GASP upper middle class wealthy?

        It seems to me the support models is a little more egalitarian. Iw ill enable many many people to be well off rather then having just a few people to be very wealthy. In fact it will probably enable just about anybody who wants to make a decent livi

  • Curiously... (Score:5, Interesting)

    by Spy der Mann ( 805235 ) <`moc.liamg' `ta' `todhsals.nnamredyps'> on Monday November 07, 2005 @12:49AM (#13967075) Homepage Journal
    Today I watched a TV show on hackers. How the hacker culture formed, from the phone interventions to the computer makers. One thing that called my attention was Bill Gates' letter [nyud.net] to the homebrew computer club, saying:

    "As the majority of hobbyists must be aware, most of you steal your software. Hardware must be paid for, but software is something to share. Who cares if the people who worked on it get paid?"

    It's so funny, isn't it? At the beginning, Bill Gates complained about people sharing "his" software. But now, people sharing FREE software (Linux, OpenOffice) is what's ruining his business.

    Oh the irony....
    • However, I wouldn't call being the number 1 OS being "ruined".

      • Re:Curiously... (Score:2, Insightful)

        by Seumas ( 6865 )
        I dunno. I like to think of windows as "number two".

        *cough*
      • perhaps i should be more explicit the next time.

        I'm saying it's "ruining", i.e. present tense, something happening. Saying "ruined" refers to something that ALREADY happened.

        By "ruining" i mean campaigns such as Google's, cooperating with projects that are a direct competition to Microsoft's. Perhaps I should have said "is threatening to ruin", or "beginning to ruin".

        In any case, it'll be fun watching how the water is slowly filtering into Microsoft's boat. And certainly much more interesting than the Titan
    • Without good software and an owner who understands programming, a hobby computer is wasted. This coming from a guy who made a fortune selling an operating system which is advertised as being idiot-proof.

    • Re:Curiously... (Score:3, Informative)

      by ghakko ( 261165 )
      I don't think there's any irony here, because Gates was being sarcastic. The letter itself was bitter complaint about the majority of Altair users not paying for copies of BASIC and hence "stealing" the development effort he had put into writing it.

      At the time, this was rather novel concept. The mainframe and minicomputer vendors of the era basically sold hardware, the cost of which far dwarfed that of hiring programmers to write the operating system and application software they ran. Thus, turnkey solutio
    • During the 1850's most astute businessmen saw production as a 2n'd class industry - all the big wealth was in plantations and farming. But unfortunately for them, the industrial revolution forced the commoditisation of the labor force and the death of the plantation system.

      Today many people see serivces as a loosers industry. All the big money is in factories and content "ownership". Unfortunately for them, the information age is doing for services what the industrial revolution did for production. The

  • Does that make it better than the alternative? (Score:5, Insightful)

    by ReformedExCon ( 897248 ) <reformed.excon@gmail.com> on Monday November 07, 2005 @12:50AM (#13967083)
    If you want to say that Open Source software can lead to a viable business strategy, then I don't think anyone can really argue with that. There are companies that sell bottled water and others that sell magical stones, so there's got to be some way to make money stuff that is given away for free.

    But is it a better strategy than actually selling proprietary software? Perhaps, but then again, it depends on how you define "better strategy". The whole point of keeping software closed is to keep control over the product. By doing so, it is possible to make money through lucrative licensing schemes. And the best part is that you only have to write the software once in order to license it multiple times.

    With Open Source software, the product is generally available for free from any number of vendors, so such a situation limits the licensing fees that can be generated. Also, because of the nature of Open Source software, customers may choose any number of other service companies to do customization work. This is not the case with Closed Source, as the company that owns the product maintains strict control over who has the ability to do customization work on it.

    On top of all this, how lucrative is "Service" anyway? In general, a product-driven strategy has a better margin than a service-driven strategy. A product only has to be written once, so the costs are all up front. In a service company, each project requires a certain number of employees, and as projects increase, so does the required headcount. There is always a growing cost of payroll associated with growth in a service company, so much so that as the number of engineers increase, the profit margin falls significantly because of increased costs such as HR and "non-essential" staffing overhead.

    This is not to say that there isn't money to be made here. In fact, there is a lot of money to be made by keeping projects to a minimum and keeping headcount low. However, a company with any aspirations to become large and self-sustaining must rely on a strong product base and not solely on service.

    But it doesn't mean that Closed Source is better. Just different. In many ways (such as from the point of view of the customer), Open Source represents a much better solution than Closed Source offerings. However, from a business standpoint, it's hard to imagine why anyone would see OSS as a better alternative to CSS.

    • On top of all this, how lucrative is "Service" anyway? In general, a product-driven strategy has a better margin than a service-driven strategy.

      Service is not worth much money in the home sector, but worth many times more in the commercial sector. So, you give away the software for free to the home consumers, and they provide your market validation for support at the commercial sector.

      • Ah, but if you produce the software yourself and keep it closed AND provide service to your customers, you now realize both benefits whereas the OSS strategy fairly limits you to just the service aspect of the business.

        Again, I'm not saying it's better. There are risks involved such as your customer base suddenly deciding to dump your product which then causes you to lose both the product and service revenues. That would be a pretty big hit. Much bigger than a service company which would theoretically be

        • Ah, but if you produce the software yourself and keep it closed AND provide service to your customers, you now realize both benefits whereas the OSS strategy fairly limits you to just the service aspect of the business.

          Good point. However, in the commercial sector, you might stand to make $100 per seat for your software, and then $50 per month per seat for support.

          Support is ongoing revenue...so the initial cost of software is only relevant when you need cash on hand. Which is irrelevant to companies

    • Re:Does that make it better than the alternative? (Score:4, Informative)

      by Ctrl+Alt+De1337 ( 837964 ) on Monday November 07, 2005 @01:10AM (#13967169) Homepage
      There are companies that sell bottled water... so there's got to be some way to make money stuff that is given away for free.

      They give away water where you're from? Where I live it's part of my monthly utility bill ;)

      But seriously, the US economy has been converting over to a service economy over teh past century. It has been quite some time since GDP was more products than services. Products can be made anywhere, and with software the transportation cost is nearly $0. If you rely on software products then you had better be sure that you're the best or else because lower-cost software can be made in India and China.

      Services can go either way. The call center may be in Bangalore, but if you need someone to come to your business in Topeka either for training or an on-site service call, there's definitely not going to be someone coming from New Delhi to do the job. Services are a great hedge against the future, which is probably why IBM is shifting focus away from solely producing their international business machines to providing consulting service. Plus, it's perfectly in line with where the US economy has been headed for decades.

    • Sell Improvements (Score:4, Interesting)

      by queenb**ch ( 446380 ) on Monday November 07, 2005 @01:15AM (#13967198) Homepage Journal
      I cannot tell you the times I've ripped down an open source package that was oooo, ever so close to what I really wanted. If the source code happens to be in a language I know, I usually felt pretty free to modfy it to suit my purposes - namely the pursuit of world domination.

      All kidding aside, this business model already exists. I've seen a lot of web shops that run this way now. They get ahold of some open source portal product, learn to tweak it, and then they sell it to all their customers with a specific set of tweaks for each customer. Heck, if more people knew they were running on Mambo, they'd be on the phone yelling at their web guys for charging them umpty-thousand dollars for "a custom portal application".

      2 cents,

      Queen B
      • Yes, actually that is one of the better OSS business strategies.

        In fact, unlike what Bruce Perens says below, it is precisely the companies with a stake in the software (as providers of service for the software) that are making significant improvements to the software. Whether this is through bugfixes or additional features, the software is improved and because of the GPL, returned to the community.

        When you perform several service contracts, you will usually see a trend in the development. Maybe a certain

    • Interesting, yes. I often think it's strange how many believe that Open Source is a better course for all software, or that Closed Source is the same. In reality, I don't think either succeeds in the needs of everyone 100% of the time. There's problems and benefits of both, which are often framed within context.

    • In a service company, each project requires a certain number of employees, and as projects increase, so does the required headcount.

      Well, they could always just increase hold times. If you get the right balance, some customers will get annoyed and hang up, but when the service contract is with a large company, one or two "They put me on hold too long" comments can be ignored. Now you can keep your staff #'s lower....of course, in the case of an 800 number (becoming much less common now-adays) your phone

  • I beg to differ. (Score:5, Insightful)

    by Bruce Perens ( 3872 ) <bruce@perens.com> on Monday November 07, 2005 @12:59AM (#13967125) Homepage Journal
    I do not believe that businesses with a product that is related to Open Source will be, or are, the main driver of Open Source software development. The companies that use Open Source software to get a job done, and that have a product that has nothing to do with Open Source, are the most important ones. If you trace the money that pays for software to its source, those folks are it - software vendors just work for them. All of those companies devote some money to writing non-differentiating, cost-center software. They can distribute the cost and risk of such development by using Open Source for all enabling, non-differentiating technology. I've written a paper that goes into this. You can read it here [perens.com].

    Bruce

    • You must be new here . . . *chirp chirp chirp* . . . .

      We folks barely can be bothered to RTFA much less RTFP!

    • Re:I beg to differ. (Score:5, Interesting)

      by Ctrl+Alt+De1337 ( 837964 ) on Monday November 07, 2005 @01:26AM (#13967243) Homepage
      The part of what I have read so far that jumps out at me was this:

      Is the greatest economic effect of Microsoft the fact that they have enabled a great many businesses - their customers - to do business more efficiently, and to have businesses that they could not operate at all without the software that enables them? Yes, that is the biggest economic impact of Microsoft.

      Microsoft is a tool-maker, and the effect of the tool-maker on the economy is tiny next to the economic effect of all of the people who are enabled by the maker's tools.

      It's like my marketing (shriek! yes, marketing) professor says: when people buy a 1/4 drill, they're not really buying a 1/4 inch drill, they're buying 1/4 inch holes. The product itself is not as important as what it does and how it benefits the consumers.

      I think this is an area that open source could use some work on. It's not necessarily that the drill has to be shinier, fancier, or even more featureful than Microsoft's/Adobe's/any other propreitary software maker's drill, rather it must drill better holes more reliably at a lesser cost. Then, we can can worry about what kind of finish is used to make it gleam under lights.

      Case in point: KDE and Gnome both put a lot of work into eye candy, and justifiably so, but neither can give me a list of all the wireless networks around my computer in just 2 clicks in a default setup - but Windows can. I'd imagine OS X probably could too. It's these kinds of things that I'm talking about. Supporting wifi isn't enough - that's a drill that leaves jagged stuff around the 1/4 inch hole instead of making it clean all the way through.

      • Re:I beg to differ. (Score:5, Insightful)

        by Bruce Perens ( 3872 ) <bruce@perens.com> on Monday November 07, 2005 @01:30AM (#13967256) Homepage Journal
        One of our main differentiators is control. Rather than sell 1/4 inch holes, we're selling the ability to drill the size of hole you want, and not be limited to the drill sizes they have at the store.

        Bruce

        • That's very true, and I probably should have made that as a disclaimer or something. I just used the drill analogy because my professor did. By being specific on the size, I was referring to how individual programs generally only serve one purpose, like Gaim with messaging, and the Gimp with graphics.
        • Is "control" a euphemism for "incomplete"?

          And if the ability to build your own tools is the deciding factor, how are you limited by any closed-source package? It isn't like good compilers and editors aren't available. Isn't a compiler essentially the ultimate tool of control?

          Why would you choose one product that was incomplete but allowed customization over another that completely fills your need? I don't understand the thinking here. Having a tool that does its job well is far better, in my view, than

          • Re:I beg to differ. (Score:3, Interesting)

            by Bruce Perens ( 3872 )
            Isn't a compiler essentially the ultimate tool of control?

            Yes, if you want to sustain all of the cost and risk of development all by yourself. One of the main points of Open Source is that you can distribute that cost and risk among many parties.

            Is "control" a euphemism for "incomplete"?

            We have lots of finished software. And the world has square holes and round pegs. The people who finished that software never dreamed of a square hole.

            As an example, I once met a Divinity Ph.D. who was using the Debian L

            • In what sense was the Divinity Linux that your PhD friend was using different from the standard Debian Linux distribution? Did he get into the source of the OS and change the code to suit his needs? Or was it more a matter of using a set of tools that runs on the operating system to develop what he needed? I am genuinely curious, because it would be the first time I had heard of anyone significantly changing the base OS source code on their own for reasons not related to budding curiousity.

              But the questi
              • You have to get it out of your mind that coding is the only way to contribute to open source. Also please try to understand the the freedom to upgrade when you want, the freedom to choose vendors, the freedom to try things to see if you like them without it costing you an arm and a leg and the freedom to download and install a product without getting budgetary approvals, giving your credit card number to somebody and waiting for delivery is very important. More important then coding.
              • He did not produce his own distribution variant. He was working in rare or dead languages and religious symbology, and needed to input and reproduce those symbols. The MS system at the time wasn't versatile enough. I'm not sure that Windows fonts and keyboard maps would handle the problem today.

                Bruce

              • But the question remains, how much actual source code alteration is going on by people outside of the dedicated development teams (meaning the users of the software, not the source code contributors)?

                Well, I currently have a major investment bank requesting at least a quarter Million US dollars worth of work on Open Source tools, to make them better service their own needs. They have performed some of the work themselves, and are looking to contract some out. This stuff isn't unusual.

                Bruce

        • But Aunt Tillie doesn't want "control". She wants to do simple things in a simple way, and frankly as an engineer, so do I. Eric Raymond wrote about this problem compellingly in an old Slashdot referenced story, http://www.catb.org/~esr/writings/cups-horror.html [catb.org].
          • There are Open-Source-based systems for Aunt Tilly coming about. Firefox is a good example. But that's not the major driver of Open Source development. Use within business is.

            Bruce

        • That's a pita if like most people, you just want a 1/4 hole (metaphorically speaking).

          Of course, extending the analogy, we need something that's cheaper to make holes with (or at least competition) and also better quality.

          ATM we have the equivalent of a bargain tool (which it has to be admitted, does drill holes/do the job) being sold at premium prices.

          Apologies if the extension of the analogy doesn't work and this sounds like a load of nonsense. You know what I mean. Windows isn't as bad as people make out
      • RE the wireless network browsing capability, Mandriva 2006 has this capability built in upon install. (called net_applet). All you do is right click on the systray icon. This is a case of a linux distro filling a hole in functionality. I really like it actually; it works quite well. 2006 on my laptop is a hasslefree experience (also the startup time is much improved over previous versions).
      • neither can give me a list of all the wireless networks around my computer in just 2 clicks in a default setup - but Windows can. I'd imagine OS X probably could too.
        OSX takes exactly one click :) twice as good as Windows.

    • Eh? (Score:2)

      by twitter ( 104583 )
      I do not believe that businesses with a product that is related to Open Source will be, or are, the main driver of Open Source software development.

      Who said that? Even the IBM rep quoted credited the developer community as a source of innovation. Did I miss something in the article or goof the summary?

      People are getting it. I submitted this story because of it's friendly portrayal of free software by a mainstream news outlet. David talked to people who say most of what you say, ORiely, Thoughtstrea

      • It's a fine story and no problem with your submitting it. But it starts the economic explanation with The source code may be free, but there is gold in software support, training and publishing. I'd like to get people to stop thinking about it as a vendor-driven phenomenon. There will still be money for Open Source development without vendor participation.

        Never mind that I work for a company that does support (Sourcelabs), I do training, and I'm a publisher (Bruce Perens' Open Source Series) :-)

        Bruce

  • There's more than support (Score:5, Interesting)

    by max born ( 739948 ) on Monday November 07, 2005 @01:06AM (#13967159)
    Damien Conway, who trains programmers through his business Thoughtstream, said: "I think the most successful of those is definitely licensing support; providing the software and then saying: 'if you want to buy a support contract, here's what it will cost you on an ongoing basis'.

    There's more than just support:

    There's also building and designing systems using open source. Like backup and mail systems, for example. It can sometimes be a lot cheaper (in savings on proprietory licenses) for a company to hire someone to implement an open source solution.

    Then there's customization. Sendmail does X and Y but some company wants it to also do Z. They hire a programmer to write an add-on or a module. Again it can be less than buying proprietory licenses.

    I've been implementing Linux systems for nearly 10 years doing just this and I've made a lot of money by helping companies save money.

  • The Open Source Model Just Makes Sense (Score:4, Interesting)

    by quadra23 ( 786171 ) on Monday November 07, 2005 @01:19AM (#13967218) Journal
    These are programmers building great technology to help their peers to build software to solve customer problems.

    Let's face it, the Open Source Model is more focused on meeting the needs of its user community for the sake of the community. In contrast, the closed-source for-profit model typically works on the basis of, "Is this good for company? Will this help us sell more product?". When your concerned 100% about the community your mentality behind development is far more focused on the solution and how the product can be improved, with no extra baggage like the requirement of turning a profit by giving focus on things that would simply sell a product (the changes in closed-source could be good or bad, since the focus is a sell not product improvement). I know it's been said before but it can not be overstated, for-profit companies can easily disappear and no promise that any sort of support is available in the future. The Open Source Model is so flexible that as long as people still use the software it can still be improved and developed. Essentially it's quite hard when using Open Source to lose any time investment (unless the software was that poorly used to begin with), while with closed-source model you can lose both time and money when the company that provided you the product disappears as well as the product support to never re-surface again.

    In Open Source there is little room for added restrictions now and later that would require another license for using the software, while for-profit will always say the EULA is subject to change and can later lock you into paying continually more. The real gold in the Open Source Model is the flexibility it gives in use of the software. The protection from a lot of the stupid restrictions (i.e. paying based on number of concurrent users of the software) that we see in closed-source software almost practically pays you back in peace of mind and saves people from features in closed-source software that are specifically designed to lock you into their products.
    • while with closed-source model you can lose both time and money when the company that provided you the product disappears as well as the product support to never re-surface again.

      They don't even have to disappear to stop supporting a certain piece of software.

  • You can find "gold" in anything if you look hard enough, or think about it the right way.

    Just look at the King of the Golden River, Harry King. ;)

    "Taking the piss since 1961."

  • It's really this simple: OSS is a loss-leader used to drive sales in other services like consulting and training. It requires a huge leap of faith (Linus) or desperation (Sun) to offer up so much hard work in hopes of future rewards, but it can be done.

    • It's really this simple: OSS is a loss-leader used to drive sales in other services like consulting and training. It requires a huge leap of faith (Linus) or desperation (Sun) to offer up so much hard work in hopes of future rewards, but it can be done.

      You've got the cart before the horse here. Unlike traditional software development, OSS development works as a business model when it is customer initiated and directed. Linux was not a "leap of faith" because Linus was his own customer. He did not want

  • Conflict between paid support and open source (Score:1, Insightful)

    by Anonymous Coward
    While there may be 'gold' in support for some people, the suggestion that software developers should *only* make money on the support of their products is fundamentally flawed. First of all, it doesn't scale. Secondly, there is conflict of interest between providing paid support and creating software that is robust, intuitive, and easily customizable, such that it doesn't need much support in the first place.

    Let's assume that you, a software developer, has created a product that is reliable, intuitive, and
  • Ironic... we like writing code, empathise with the Bastard Operator from Hell, use clue-sticks, hate lusers.

    Yet we champion open-source where our livelihoods come from supporting users, rather than closed-source where our livelihoods come from writing code.
    • Yet we champion open-source where our livelihoods come from supporting users, rather than closed-source where our livelihoods come from writing code.

      Maybe, but part of the problem is how inclusive the closed model is. There are only so many jobs writing the "core" code (the OS, the drivers, the productivity software), which closes out most of us. With OSS, more people can participate because a big part of the qualifying criteria includes your willingness to donate time to the effort.

      Then, a sort of meritocr

  • Flocking obvious, BBC! (Score:4, Funny)

    by Anonymous Coward on Monday November 07, 2005 @01:52AM (#13967338)
    One very recent open source innovation is Flock, a browser that integrates next-generation web technologies such as RSS, blogs, bookmarks and photo sharing.

    That would be the same Flock I downloaded the preview of last week - the one that is a build of Firefox with a new skin, a mildly different methodology for bookmarking (meh, tags) and er... er... it has a pop up editor for your blog that er... is not quite as good the one you can get by er... going to your blog and er... creating a new post... oh and a really shonky clipboard feature...

    Oh and Next-gen web technologies? Hmm, my first blog (and I was slow to get on that bandwagon) er... 2001... so four years ago, practically neolithic in IT terms. RSS, hmm, played with that in 2002 for the first time professionally. Bookmarks, they've been around at least a decade in web browsers and the prior art must stretch back to the dawn of computing. Oh and photo sharing... has been around since a tech first realised he could digitise a pair of breasts and then display them on a teletype and then send it to his mate at the next terminal*

    * and I'll bet there are some suggestive punched cards out there as well...
  • I don't see how you can get to a point where you sit back, and essentially sell your code base over and over again, as most market-leading software companies do. That is where the huge profits are. All the typical ways of earning money using OSS requires that you constantly provide services, which despite being steady and profitable isn't a cash cow. The closest thing would perhaps be selling some piece of hardware only running software digitally signed by you, or OSS software running with proprietary softw
    • I don't see how you can get to a point where you sit back, and essentially sell your code base over and over again, as most market-leading software companies do. That is where the huge profits are.

      Perhaps the mone is there today, but the countertrend has started and is gaining locomotive like momentum. It feels a lot like the mid and late 80's where the economics of computer hardware changed. Back then timesharing is where the huge profits were, and no one was going to toss the mainframe for those PCs conne

  • Successful business model -- examples? (Score:1, Interesting)

    by Anonymous Coward
    Perhaps someone can point out examples of companies that are successes using the business model the article describes.

    O'Reilly makes money from books. Red Hat, MySQL make money from license revenues.

    Namesys developed a highly-regarded file system (ReiserFS). It knows the reality of the "give the software away and make money on support" business model. Namesys survived because of a contract with the government (DARPA). From the company's web site:

    For free software based on support revenues to be

  • N3P is a two year, government financed (free as in beer) college level training in how to become a successful (free as in speech) Project Entrepreneur in Open Source.

    N3P [n3p.se]

  • One more important option. (Score:3, Insightful)

    by Vo0k ( 760020 ) on Monday November 07, 2005 @06:32AM (#13968226) Journal
    Selling THE software.
    Not "licenses to use", not "support+media+manual" packs, but THE software, that is binaries+source+specs+tools+IP+support+customizati ons+... so the buyer becomes actual OWNER of the software, not just a licensee, "person permitted to use our package".
    Sure that won't work in case of simple, tiny generic apps, but for specialised software - the government commissions a countrywide tax system, vote counting system, car registration index, health care accounting software, portals for government institutions and such. It's not likely the company would sell more than one (countrywide) license anyway, and profits from access to the sources, API, specs, ability to release the userspace tools for people for free, while making them possible to be modified to fit existing systems, it's all very important.
    People paid to create software, pay for work, not pay for item. People paid to modify the software, audit the sources, add features, keep it bug-free (not pay per bug, but pay per month of bugfixing support service), people writing manuals, how-tos, guides - lots and lots of opportunities to get paid for work on common, publically accessible code base. And of course getting paid to create the code base in the first place.
  • For the individual programmer, or small company, I think it's very simple. The open source building blocks are free, and freely available, but to use them well and combine them into systems to meet particular requirements takes uncommon knowledge and expertise. The only real way to get that expertise is to join the project, or work in tandem with it in some constructive way (eg CPAN modules, mailing lists, documentation, bug reports). So: more eyes, more open source developers.

    And I don't for a moment subsc

  • The BBC article and the /. summary make similar mistakes that stem from a non-critical examination of the open source movement—using terminology and telling history in such a way as to refer to much the same software as the free software movement refers to but without the ethical component. This is all done to explain how things are strictly from the perspective of business.

    As a result, "Linux" mistakenly becomes an entire operating system; not even a share of the credit for GNU, a primary contribu

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