Part 2 of Making Money with FOSS
Yesterday there was a an interesting discussion kicked off by Nick Fox about the economics of Free and Open Source Software. Numerous other people joined in adding their thoughts as either comments on our posts or as their own posts.
Nick responded to my criticism of him article and invited me to respond. And I do owe it to him for kicking off this journey into discussion and it’s certainly not a topic that is touched on nearly enough for a maturing creative community.
So lets get into Nick’s new post:
Producing open source software can be quite lucrative. Some great examples of corporations making money from open source software are, Oracle, Sun, Canonical, and so on. There are so many I am sre I wouldn’t be able to research and name them all.
If you look into each of those companies, I know of only Canonical that leans heavily of the money it makes off of pure development. It does this not from common users, but from OEMs such as HP and Dell, who are constantly asking Canonical to develop custom interfaces and various other things for their releases. All the other companies aren’t making money off of the development work, but off of the result of that work through services.
It’s a slight distinction, but it’s what separates the idea of earning money from performing an action on a customer’s behalf, to developing something which you give away, and for you to offer them further products on top which they buy. In each case your thinking about which work was paid for and which work was not. In the services model, the programming wasn’t paid for directly.
I was making the point that while FOSS is commercial through support services and other means, the software itself is generally rejected by the community unless it is Free (and I mean Free as in Freedom) itself.
And there are very good reasons for that. Proprietary software isn’t useful to the community, it’s useful to individuals. You can’t collaborate on proprietary software, there is no crowd sourcing closed source. Freedom is more than just a throw away ideal, discarded at the first sign of convenience, it’s a culture, an ideal and a social good. The commons works by making things common, accessible to all. Deliberately slicing parts off into enclosures break the nature of it.
What I’m trying to say is that people in the community are not rejecting proprietary software just to be spiteful or grumpy. They do it because to accept it would be a step backwards for the community.
It however does not afford a person or business the right to infringe/reproduce or otherwise make money directly from another person or business’ goods or services without their direct consent.
The law of properties isn’t quite as clear cut, you have to transcend for a few moments the normality in our culture that suggests that attribution is the same thing as control of copies. You can reproduce works that are in the public domain, there is not infringement. The only time infringement even crops up is when you introduce a government regulation, a wholly unnatural legal property system which seeks to make monopolies and controls content from afar.
It was originally created as a balance, a technical fix to a market problem. That problem is that creative works are not profitable to make because anyone naturally has the right copy them. The only fix was to go against nature and prevent or make illegal the copying of those works.
Making a copy of a Monet Painting and reselling it as your own painting is forgery, the creativity behind creating applications is nearly the same.
Making a copy of a Monet painting is very legal. His published works are now in the public domain, you can take a photo of his painting or repaint the work from the eye. What you can’t do is claim that you were the original creator, or claim that Monet himself painted the result. That’s a VERY different set of laws from copyright and has nothing to do with what we’re talking about.
Now the physical copies of the paintings obviously have owners, but they only own the paint and canvas, not the image that they make up. Of course I think paintings might have some legal grey area about weather they’ve been published or not. But it’s still important to distinguish between copyright, trademark, authentic authoring, attribution and even patents. They’re all very different mechanics that shouldn’t be confused.
In a perfect world, this would be great. everyone would get compensated for their creative productions and contributions to the whole.
Part of these kinds of discussions is attempting to figure out exactly how you can make that perfect world. What’s the point otherwise.
However, being this is a less than perfect world, and less scrupulous people are out there trying to make money from other people’s hard work,
Making money from other people’s hard work is something that we do all the time, it’s not wrong, mostly because we end up adding something of value from ourselves. Either ease of access, verification, extra add ons. Very few economic activities are done without other people’s work being involved.
You can’t make money off of someone else working, that is wrong, I think it’s called slavery. You can’t force a programmer to build you something, but you can pay her to build you something. The fact that there are 100 people waiting in the wings to make money from that thing is irrelevant for the buyer and the programmer, or at least it should be if the buyer understands what he’s doing.
In the end, the sad fact is, businesses need that level of comfort that closed source brings to attract them to the venue. Businesses need to make money and continue to do so over the long term. Most traditional businesses do not feel that is possible by sharing their code with the entire world.
The problem with this sad fact is that businesses are only after the comfort in an unsustainable monopoly from which they could extract rents in a very unrefined way. If they don’t want to engage in breaking the free market, then they have to start making money from the work that they do, instead of the work that they have already done.
Most traditional businesses, I have to admit, don’t understand FOSS. We in the community can’t explain these ideas to these businesses if we can’t even understand it ourselves. That’s why it’s important to have these kinds of discussions in the community.
FOSS isn’t some hippy trippy excuse for programmers to have a 70s revival. It’s a real, effective economic and social method of creative production that just needs to develop further in society’s understanding and expectations.
Tags: Economics, foss, free software, linux, open source, Ubuntu
I think we’ll always have closed source, because we all need to eat, and supporting something small, and niche via people paying for support just won’t work.
If you really want to get rid of all closed source, then find a model that will allow developers to be paid, whilst not charging for the software. And the people who market the software. And the people who deal with the paychecks. And the website. Etc, etc,
This is what I’ve been doing, but every time I talk about it people like yourself just skip right over the proposal and go “But FOSS doesn’t make money does it”, it’s like I’m not putting it in words that make sense yet.
You get paid for WRITING software, not for DISTRIBUTING software. If someone wants something written, then it should be possible for them to pay for someone to do it. Sounds easy, at the moment in FOSS we discourage people from paying for development, even though it does happen.
Although most FOSS programmers for the big projects are paid employees anyway, so we’re not really talking about things like Linux, but other FOSS projects.
Thank you for writing this great series of articles! I’m truly glad to see someone outside of the FSF itself writing about these topics who really gets it, and really believes in the model. I know I’ll refer skeptics to these writings in the future.
Martin, this has been very thought provoking and an interesting travel into the less commonly viewed side of FOSS, I have a follow up part 3 I invite you to read and post your thoughts upon.
http://www.rubmyubuntu.com/LinuxSoftwareBusiness/Part3
There is only one but major thing wrong with your business model DoctorMo.
Your model assumes that users know what they want and while that may sometimes be true, most of the time it is not. There is a big difference between what users THINK they want, and what they ACTUALLY want. You can see that in many forms in FOSS, for example, there are users wanting option A to be added to program Z, when what they actually want is a better application behavior (and that option A is not really necessary). There is another problem with this, say a part of the userbase wants to add option B and another part don’t want it, they want option C instead. You can’t please everyone, so you’ll either have to make a part of the userbase angry or fork the project so that both parts are satisfied. Then you have a problem of distribution… This can go on indefinitely and you end up with a hundred forks to maintain.
More serious problem is creating a new application. People often don’t know what they want or need until they see it. That’s just human nature, and buying is an impulsive thing. What you suggest is not buying – it’s investment, but ordinary users don’t want to invest in new and non existent software. This is especially true for entertainment software or games if you will. Would people invest in World of Goo or Caster? I doubt it. Those are some original and cool games which I think would have never made it with the “investment” business model.
That said, I hope you prove me wrong or that there is another solution for these issues.
Count me as one that doesn’t fully get it yet. Your posts discussing the difference between creating and distributing software were helpful, but it still seems to me that being able to charge for something essentially means having a monopoly on that thing, whether that thing is your time or some piece of property (intellectual or otherwise). When a potential customer can get what they need for free, why would they pay for it? Perhaps what you envision is a purely service economy (outside of hard goods such as toasters, in which case replication and distribution would have costs). If you have any references that would help me understand where you’re headed that would be great. I’d love for a robust economic model to grow out of FOSS, but I don’t see it yet.
A related question: If I’m a software developer who wants to work in line with FOSS principles, can I charge for anything other than my time?
Maybe the money can come in with additional services to enhance the FOSS.