Choosing a Model for Your Open Source Business (2017)

https://snipe.net/2017/08/05/choosing-a-model-for-your-open-source-business/

48 13 6 years ago

a9t9• 6 years ago

Nice overview.

"Freemium is a harder model to implement in open source, since the source is, well, open, but we do see this in things like WordPress...."

=> Just to add another flavor: The Freemium model is working well for us even so we are not SaaS.

In our case, the main part of the RPA software is open-source (GPL) and free. All Internet access is only done within the open-source core.

The features of this core app can be extended by local native apps for Mac, Linux and Windows. These are proprietary/closed source.

open-source-ux• 6 years ago

Among the thousands of open source projects, the ones championed as successful open source business make up a tiny proportion i.e. the exception not the norm.

Meanwhile the SaaS business model continues to eat the software market. A model that gives users less control than the desktop software model. And where the source code (built on open source) is not visible.

Open source software has been critical to the success of the SaaS model. You could argue SaaS is the true success of the 'open source business model'. Just not in the way open source advocates expected it to be.

There is another option - one that some open source advocates will immediately dislike: source-only products i.e. you sell your software product to customers to run them themselves. You give them the source code of your product so they can customise it to meet their needs. But the software is not open source and cannot be shared the way open source can.

There are successful source-only products. Two examples: Craft CMS and Kirby CMS. Both publish their source code on GitHub [1] [2] and rely on the honesty of their customers to pay (which they do). They have a thriving community of developers making plugins and extensions - proving that you can create a community of developers around a 'source-only' product.

[1] Craft CMS: https://github.com/craftcms

[2] Kirby: https://github.com/getkirby

james_impliu• 6 years ago

Among the thousands of open source projects, the ones championed as successful open source business make up a tiny proportion i.e. the exception not the norm.

I think this is a correlation not a causation thing. Specifically, open source is a great place to put hobby or WIP projects - SaaS isn't, you wouldn't want to pay for others to use your stuff for free. Certainly, historically, your point is valid - SaaS has benefitted hugely thus far, but I think it seems rational this starts to change.

Open core feels like it has the advantage of the source-only approach yet also enables a community to use a free product on top, generating faster growth and user trust and feedback, all of which are harder to create with SAAS. The downside? You have to build two products. At least for those willing to do the VC route (not for everyone), it is possible to get funding to do this.

Disclaimer: I am a co-founder of a VC-backed open core company!

pjmlp2• 6 years ago

Same can be done shareware.

orlandohill2• 6 years ago

The Polyform Project has a set of standardized source-available licenses. These can be used for a dual-licensing business model. Customers can use the software for free under the terms of the source-available license, or pay to buy a proprietary license.

https://polyformproject.org/

MayeulC• 6 years ago

Among the thousands of open source projects, the ones championed as successful open source business make up a tiny proportion i.e. the exception not the norm.

I think that open source projects tend to be smaller. However, is size the correct proxy for success? I would argue it isn't for companies, and rather the opposite in fact.

A small company that does well what it set out to do is successful in my view, even if you can count the employees on one hand. Likewise for software projects. Also, maintenance mode is a thing, and it's all right, so the number of commits isn't a good proxy either, IMO.

blackrock• 6 years ago

And where the source code (built on open source) is not visible.

Is the software for your SaaS required to be open sourced?

Sure, you may be building your business off of Linux or other open source software code, but you’re not modifying it.

And if you need to modify it, then maybe you can share it back with the community.

But, I would think that the product you built, should be your own intellectual property.

mrskitch• 6 years ago

I think dual licensing is possibly the best way to go, if your product mitigates a risk. It's why we went that way with browserless.io

Truth be told selling a small library probably isn't enough to make significant money on your product since it isn't solving a big enough risk. The risk of forking is fairly low, especially for small to mid sized companies. Larger companies, maybe so since things like security become much more urgent.

It's hard to separate people from their money, but I feel it becomes a lot easier if it offsets a potential risk they're not willing to take. Just my 2 cents.

ralmidani• 6 years ago

I used to be a Copyleft zealot. But eventually I realized that an absolutist insistence on “Free as in Freedom” has become outdated: when the GNU project was started, it was not easy to distribute copies of large programs. That is no longer the case (you can now serve complete photo editors, IDEs, etc. over the web). The FSF thinks it’s OK to “sell” your program, but if it’s under a “true” FOSS license, how do you get compensated for the value your program provides to those who get their copies from the person/company who initially paid you? And what’s to prevent a group of people/companies from pooling their money and pretending there’s only one customer willing to pay for your product?

Zealotry makes it impossible to have a middle ground between “Four Freedoms” and “all rights reserved”, and insisting there’s only one true way to do FOSS will lead to 100% proprietary software dominating end-users (which is who the Four Freedoms were about in the first place).

I think an approach that preserves some of the Four Freedoms, while restricting distribution of the core program, would still be in agreement with the spirit of FOSS. For example, what’s wrong with a license that lets anyone study the program, modify it, etc. but empowers the Copyright owner to collect money from those who run it in production? If selling your program is OK, but modern technology makes it impossible to be compensated fairly by users of your software (and even worse, competitors with deep pockets can out-scale you and put you out of business), this seems like a reasonable middle ground.

orlandohill2• 6 years ago

Putting certain restrictions on The Four Freedoms for the sake of building a sustainable business sounds very reasonable.

Some licenses put restrictions on freedom 0, the right to run the program. That's the approach taken by Prosperity and the Polyform licenses.

https://prosperitylicense.com/

https://polyformproject.org/licenses/

The Parity Public License takes a different approach, and expands the concept of copy-left to require developers to release the source code for all of the software that they develop with the program, not just software that they distribute to others.

https://paritylicense.com/

pjmlp2• 6 years ago

Same here, that is why you see my rants about developers not paying for their tools and only enterprises being valuable customers.

I eventually switched to hard GPL + commercial licenses for anything else.

Incidently this also to blame for the rise of SaaS, people only pay if the software runs in someone's else computer.

jabl• 6 years ago

“Free as in Freedom” has become outdated

Not sure if it's outdated, but what is clear is that the world has largely rejected it (maybe we'll come to regret it later). On the smaller end of the spectrum, the rejection of GPLv3 by most critical projects (in particular, the Linux kernel) has meant that locked down devices powered by ostensibly free software have become increasingly common. On the other end of the spectrum, the wholesale rejection of AGPL by, well, more or less everybody, has enabled the SAAS providers to "proprietarize" free software. And on top of that, we have the general shift towards more permissive licensing in the FOSS world.

Nowadays I'm more hopeful about right-to-repair and data portability style legislation as means to give individuals back some of the power over their own lives.

The FSF thinks it’s OK to “sell” your program

I think originally it was because adding some "non-commercial only" clause would have made it difficult to cover costs of distribution. To an extent it applies even today, consider distributing free software from a (partly) ad-funded website etc. But as you say yourself, this is not per se a business model that covers the cost of developing the software, as you're giving the same distribution rights to the downstream user as the upstream developer.

Then again, the "four freedoms" always were a set of moral principles, not a business model recipe.

teddyh• 6 years ago

See also Selling Exceptions to the GNU GPL: https://www.gnu.org/philosophy/selling-exceptions.html

Choosing a Model for Your Open Source Business (2017)

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