Open Source – the next phase

It will be interesting to watch the evolution of open source software (OSS) in the next few years. On the one hand it’s a fabulous, powerful new way of working. But will it displace slightly less fabulous ways of working – like Microsoft’s. I’ve always been sceptical that MS will be easy for OSS to knock over – even in the long run – because it can always open source itself to the extent to which competitive pressures require it.

That is it can publish part or all of its source code and licence its users to modify it. It could still retain copyright over the code and so protect the price sliding to marginal cost as it does with OSS.

It can then then accept back modified code from users into the core program if it wants. It even has some advantages – namely that it can pay people to do it if it wants. Still maybe the geek readers of this blog can fill me in – I’d be surprised if some firms aren’t doing this already.

Then again, a proprietory software company can’t fully open the source code – that is publish it under a GPL licence – as this will prevent it retaining control. Still, Microsoft has just taken the first step along the path that one would expect it to take according to this analysis. According to an online industry pundit “the software powerhouse is, for the first time, including open-source technology in one of its shipping products.”

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Jim Steel
2022 years ago

Once again, open source does not mean GPL.

As for your call for examples of firms integrating open-source contributions into their products, look no further than IBM. Their websphere product is built on Eclipse, an open-source project, but WebSphere itself is payware (although admittedly its business model might be more about consultancy than selling software). They also pay people to work on Eclipse and Eclipse projects, both in terms of development and research, and as full-time and short-contract workers. Apple is another example with its Darwin project, various bits of which find their way (I believe) into Mac OS X. Sun do it with NetBeans.

What we are seeing though, I believe, is a move towards a more service-oriented marketplace with respect to software. More and more business is being done by combining open-source software, most significantly the LAMP (Linux/Apache/MySQL/PHP) packages that hold the internet together, with the profit deriving from the assembly and subsequent maintenance of systems rather than the building and selling of products. IT professionals have long known that integration is one of the key aspects of the industry, and I think that open source is making it more so.

Nicholas Gruen
2022 years ago

OK Jim, I take your point. I know open source doesn’t mean GPL. I was using shorthand. We could distinguish between three kinds. (though of course there are any number of variants in between).

1 Fully open source – which seems pretty indistinguishable from public domain software – as in the Appache licence. It’s open source and anyone can take bits of it and close their developments.

2. GPL open source which has a ‘viral quality’. You can use the software, but subject to ‘share and share alike’ requirements that the GPL imposes. In many ways this is what’s most interesing in OSS. Because, according to my argument anyway, it is a genuinely new economic form.

3. What I’ll call proprietory open source. Here a proprietory software producer would release the source code. It could do so either to let users tinker, or to actively encourage them to contribute their enhancements to the project. But it remains proprietory and protected under copyright and so illegal for people to copy it without permission from the proprietor. Microsoft can take any software that’s looking threatened by (other) OSS in this direction. I would have thought it was a powerful competitive move.

Chris
Chris
2022 years ago

Talking about “Proprietary Open Source” is rather confusing. There is a widely accepted definition for open source software here:

http://www.opensource.org/docs/definition.php

Anything else can be considered proprietary, even if the source is available.

Also nearly all OSS is still protected by copyright. Thats how licences like the GPL are enforced.

There are some companies that release their software under an open source license as well as sell an identical version. An example of this is Qt (a GUI toolkit) which is available under the GPL at no cost, or you can pay for an identical version which allows you to use it in your programs without also releasing your source under the GPL.

Nicholas Gruen
2022 years ago

Thanks guys, but so far all we’ve got is definitions. I don’t think the way I’m using the terms is misleading. When called on the terminology I’ve tried to clarify what I’m trying to get at.

If you do want to take me up on my use of terms, it seems only fitting that you propose alternatives that might move the conversation along.

Jim Steel
2022 years ago

OK, I’ll bite. Specifically, your question of whether open-source will displace traditional software business practices. I think the answer is no, but its complicated. I would like to think that it would when it comes to the really widely implemented, commodity software packages. This covers operating systems, word processors, web browsers, mail readers, and music players. However, because of indirect market forces, like marketing departments and FUD about the separation of maintenance and development businesses, this will only ever be partial, probably never beyond perhaps half the respective markets. That said, there will be some displacement. For a good example, see the uptake of Firefox over the last year or so. It hasn’t killed internet explorer, but I think it’s made real inroads vizaviz market share, at least in certain demographics.

The other part of the story is customised software. When designing for big banks, factories, bookstores, newspapers and the like, the requirements of the software are, and have always been, too demanding for off-the-shelf software.

Building these systems isn’t Microsoft’s business. It’s IBM’s business, and Sun’s, and HP’s, and most significantly that of countless consultants working on configuring SAP modules or gluing web server modules to inventory systems. These folks doubtlessly find themselves using more and more pre-existing packages to assemble or customise systems, but the choice between open source and proprietary shouldn’t have a fundamental effect on what they do.

Nicholas Gruen
2022 years ago

That seems right to me Jim.

I’d only add that it will be hard work getting people off MS Word because it has strong network externalities, and OSS can’t access the full specs of the MS standard. That’s why in my view we should impose an ‘access regime’ on Microsoft products as we do on other infrastructure with natural monopoly characteristics.

Cameron Riley
2022 years ago

Are you trolling me Nicholas? :) Microsoft adds value, namely by their two main products being monopolies. Whereas Apple adds value through its easy to use interfaces. Unsurprisingly, Microsoft has not had to turn to opensource to provide a kernel (they bought the VMS source), whereas Apple did. But Apple doesnt make operating systems, it designs an ease of use user experience. Microsoft makes Windows.

Microsoft wont disappear, they have too much cash for that, but it will probably require Gates and Balmer to step down. They are business men of the robber baron era. They are also unable to innovate it seems. Compare their share price growth over the last two years with Apples. Massive difference.

One of the main problems with software is requirements. When software is commoditised, its requirements essentially become static. To a large extent anyway. This makes the barriers to entering a software project low, as most developers, and users know what the software is supposed to be/do. Just about everyone knows what a browser, a webserver or an operating system is supposed to do.

I argued in a post on SSR before that some companies were able to survive against opensource through sheer technical excellence. I used Opera as the example. Seems I was wrong. They just free beer’d their browser for the desktop. Turns out they werent making any money from it. So I think it is far to say any market that opensource enters, it will eventually make any competing product worth zero.

Jacques Chester
Jacques Chester
2022 years ago

A few nitpicks:

1. Just because it’s under GPL, it doesn’t mean that the trademarks go with it. Microsoft owns trademarks for Word, Excel, Windows etc etc. They can govern what is what by using trademarks. This is what Linus has done with Linux, by the way.

2. Microsoft still own copyright, so they can refuse to accept outside contributions to create perfect copyright integrity. Alternatively they can demand the assignment of copyright to themselves (as the FSF do) or for joint copyright agreements (as Sun does).

3. Microsoft did not buy VMS. They did hire most of the VMS kernel team, including its architect.

I generally agree with Jim that the “servicification”, to coin a horrid word, is where software is going. Shrink wrapped products are highly visible, but:

a. Software is not like other manufactured products such as cars – it can be delivered cheaply online without physical presence.

b. The major expense in software is labour. It is a labour intensive industry, despite the best efforts of all kinds of clever folk. This remains the same regardless of distribution.

Alan Green
2022 years ago

I don’t think this is a first. The Windows 95 TCP/IP protocol stack was based on the original Berkeley code, and used under a BSD license.

Jacques Chester
Jacques Chester
2022 years ago

Alan — I knew I’d missed a nit to pick! :)

In fact Windows still ships with BSD code – the http://ftp.exe client is based on the BSD ftp program code. If you search it for strings you’ll find BSD copyright attribution embedded.

Stephen Bounds
Stephen Bounds
2022 years ago

From Infoworld.com (http://www.infoworld.com/article/05/09/19/38OPopenent_1.html):

“You can’t make money giving away products. You can, however, profit by selling support and services around those products, and that’s the way many open source companies [are run] … The interesting thing about this model is that when you strip it down to brass tacks it looks an awful lot like an insurance business. Customers pay for a number to call even though they hope to never dial it …

… simply adding features isn’t innovation. Innovation means taking risks. It means R&D, which might lead to marketable products or it might not. It’s a gamble. In short, innovation is expensive. It’s the something extra, like those catastrophic costs dental plans hope they never have to pay.

So it seems to me that, unless I’m missing something, [Bill] Gates might be right. Without additional revenue from software licenses, “pure” open source companies have two options: either charge support fees that are substantially higher than those of proprietary software vendors, or else forget about innovation.”

I highly recommend the whole article. I don’t agree with all of it, but it makes interesting reading.

wbb
wbb
2022 years ago

Massachusetts has recently decreed that their gov depts are to move onto open document formats by 2007. This means a shift off Microsoft Word and onto PDFs and Open Office (which is open source).

Open source is inevitable for software doing documents, databases, etc. People cannot afford to have their valuable data locked up inside the black box of proprietary formats – it’s not really a cost issue – it’s a functionality issue.

At the personal use level open source is also a cost issue – and downloading Open Office is a lot cheaper for me than buying MS Office.

Stephen Bounds
Stephen Bounds
2022 years ago

wbb: You are conflating two separate issues.

There are clear benefits to using document formats that are standardized, documented and non-obfuscated. These “open document” formats are essential to long-term data reuse and this is beginning to be recognised by Microsoft with their new XML format for Office documents.

However, this exists separately from open source software. Open source software is about collaborative development and the ability to customize, fix and extend your key business programs if and when required. It’s not necessarily about the format of the data, although since the code is available there is little incentive to use proprietary data formats.

On the cost issue, where open source programs provide a ‘clone’ of a commercially-available program, the open-source program provides a viable market competitor to what would otherwise be a monopolistic situation. Microsoft has repeatedly been forced to cut prices in recent years to prevent government departments and large corporations migrating to an open-source platform.

This creates a healthier environment for innovation in the software industry, since any company resting on its laurels is likely to find itself competing for market share with a “free” alternative.

Cameron Riley
2022 years ago

Stephen, I think that article misses because it assumes software can be sold as a shrink-wrapped product. Business value does not come solely through a complete end product. One of the greatest repositories of business value is the jakarta.apache.org projects. I defy anyone to do a java project without dipping into that.

It is also highly innovative. The Velocity project is awesome, bugger jsp. Velocity came from a couple of other opensource templating projects that had “difficult” semi-opensource licenses. Velocity was originally an APL clone of them, and has taken off from there.

Ant is also pretty innovative for its time, as were the ORM/OM libraries, the web-frameworks etc. Usually there is a choice amongst each type of project too. ie Turbine, Struts and Tapestry.

I have written software for telecommunications, energy, asset and project tracking. I cannot recall one project i have done, that didnt use opensource. It is impossible for me to avoid.

We made money off of opensource, not by selling them as shrink-wrapped software, nor by supporting them as a service – we did so by using it to cut down the costs of a fixed price contract by avoiding paying for the commodity libraries and components.

It carries its own costs of course. I monitored the lists, submitted patches when the software didnt do something we needed etc etc. But that was included in the cost of the project.

Opensource might not make Gates rich, or means Red Hat is struggling as a services company, but it is a god-send to folks like myself, who are project based when it comes to software use/development.