Articles/where does the money comes from FOSS

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Raj Mathur's Mail


From : ILUG-D mailing list
By  : Raj Mathur 
Released under : CC-BY-SA 

That's actually three questions:

1. Why do people work with FOSS?

2. How does one earn money from programming in FOSS?

3. How does one earn money from FOSS?

Answer to (1) is pretty simple, if long. People work with FOSS because of one or more of the following:

- It's better.

- It gives anyone an opportunity to go beyond just using and into actively contributing to applications.

- There's a strong sense of community when you're working with and contributing to FOSS.

- There's a strong sense of achievement when you see your contribution actually being used out in the wild.

- You get tons of peer approval (and adulation if you happen to be Linus Torvalds) if that's what turns you on.

- Your market value is higher if you know FOSS technologies.

- You believe that software should be free and try to avoid proprietary technologies for that reason.

The second question (earning money programming in FOSS) is slightly tougher, but it's still possible to do it:

- There are bounty providers who will pay you money to write FOSS code. RH and Google spring to mind. Sarai also does the same.

- You can specialise in extending and customising specific FOSS packages for customer requirements. If the original package happens to be under a GPL-like licence your results will also be FOSS.

- You can just tell your clients that any software you write will be FOSS, and if the software is meant to scratch a specific itch they probably won't mind. Of course, if the software implements any part of their business strategy they won't be that happy with a FOSS solution.

Finally, earning money from FOSS is dead easy -- I do it all the time. Rather than make out my own list of ways to make money off FOSS, let me point you to Eric Raymond's essay on the subject:

http://www.catb.org/~esr/writings/magic-cauldron/magic-cauldron.html

Specific strategies for making money from FOSS are in Chapter 9:

http://www.catb.org/~esr/writings/magic-cauldron/magic-cauldron-9.html

Note that these are ways of making money from coding; you can also make ample money from supporting, installing, customising and integrating FOSS components for clients.

Comments and additions to this list welcome.

Regards,

-- Raju -- Raj Mathur raju AT kandalaya DOT org http://kandalaya.org/

Amir Shevat's Blog

There are at least three revenue models based on open source leveraging:

1) Dual license model – Release the product under a restrictive open-source license and provide an alternative proprietary license. This is a good strategy if you have some sort of monopoly, if you are a market leader or have an open-source product that no one else has in the open source world.

Motivation: The client really likes the open-source product and needs it for commercial use. He does not want to breach the open-source license and is willing to pay for a proprietary license.

Open-source license: GPL is the only suitable license to this strategy because of its restrictive constraints and its viral behavior (you need to be GPL to use GPL).

Example: MySQL

2) Dual product model – Penetrate the market by releasing an open-source product, sell a different product (extended version, plug-ins or an application that is based on the open-source product). This is a good strategy if you have an up-hill struggle to become a market leader or if there is strong competition. You utilize the open-source to become a well-known business technology leader.

Motivation: The user gets to be a part of an open-source community process, contributes to the source and improves it. Users purchase other related products from the project professionals.

Open-source license: MIT, BSD, Apache or any other non-copyleft license.

Example: eclipse and its non open source plug-ins.

3) Professional services model– Sell support/customization and other Professional services. This strategy requires a large base of clients that want to use the product. In addition the product must not be simple to use or else users will not need any professional services. There is no problem implementing this strategy combined with one of the other strategies, in fact it is recommended as a complementary strategy for both.

Motivation: We are the experts in this open-source project because we wrote it, therefore clients would like to purchase support and other services from us.

Open-source license: Any

Example: JBoss

Matts Hartley's Opinion

5 Models

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