Published February 12, 1999

Why Open Source Business? Open Source Business Model Benefits!

Selena Sol is one of the more engaging and creative online I.T. columnists being published, and her "WebWare" is [http://www.wdvl.com] highly recommended reading.

In a recent column, she considered open source software as a business model, and found much to recommend it. For the sake of this discussion, the terms "Open Source Model" and "Free Software Model," which in theory are synonymous, will be used differently: "Open source" has come to mean a larger set of software and software producers which do not adhere to all the qualities of a free software company, but perhaps some or most of them. The term "open source" has also gained currency since, as Sol puts it, "'free software' tended to scare off some people, especially investors and large clients," and "'open source' did better in boardroom discussions."

Her argument centers around the contention that "the open source software development process produces applications which equal or best applications produced in closed environments." The major reasons why are given below.

Robustness. As Kevin Kelly says in "New Rules for the New Economy," "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."

Sol says, "The open source model produces extremely robust code. Think of it this way, [my company, Extropia.com's] 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." She says that in fact over the years there have been bugs and security holes reported, and "by now, our applications are extremely robust." Other customers have sent in improved or more efficient versions of algorithms.

Security. Believe it or not. Open source advocate Eric Raymond explains that "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. Closed sources do three bad things: They create a false sense of security, they mean that the good guys will not find holes and fix them, and they make it harder to distribute trustworthy fixes when a hole is revealed."

Sol agrees. Open source means that customers, not hackers, can find holes and bugs -- "if a bug is detected, it is usually detected by a friend first."

Flexibility. "If you give everyone source code," says Sun Microsystems' chief scientist John Gage, "everyone becomes your engineer." Sol says in her own experience with Extropia.com, "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," sending in their ideas for fixes, features and extension technologies. "They have kept us close to them and we have always kept our ears open."

No company, not Microsoft and certainly not Extropia.com, could ever "hope to hire enough talented people to write all the code that this market will support," Sol says. Even Microsoft agrees. In the infamous Microsoft internal policy memorandum called the "Halloween Document" released last year, the Redmond colossus admits that "the ability of [open source] 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."

Market Sensitivity. Most importantly, open source is uniquely market- driven. "In the network economy, producing and consuming fuse into a single verb: prosuming," says Kelly. Open source lets you be "extremely sensitive to the demands of the market," Sol explains. Customers are the best source of direction for any firm, since they know what they want to buy, and " as a group, are endlessly, 24-7, demanding and inquisitive."