Does open-sourcing your product automatically destroy your business model?

http://geekofthehill.com/2009/07/25/does-open-sourcing-your-product-automatically-destroy-your-business-model/

by bcwood • 17 years ago

9 10 17 years ago

No, it just changes it. Make sure to prepare for the change and you'll fare well with it. Identify potential new revenue streams beforehand and provide useful services for users and developers alike.

patio11• 17 years ago

It’s important to realize that we are dealing with two different classes of users. First are the “enterprisey” users that, for all intents and purposes, have no time and infinite money. Second are the more tech-savvy users who effectively have infinite time and no money.

Not a new thought, but a great way to phrase it.

sorbits• 17 years ago

He basically says that you have to change your business model to survive.

So put on an edge, two guys who spend all their time working on the source should open source it and then spend all their time doing support work. I think that is a lose/lose scenario, i.e. the two guys no longer spend their time on what they are passionate about, and the users will see less innovation done with the product, now that the two main developers are instead using their time on support.

True that some businesses exist which are built around supporting F/OSS but those generally are built after someone else already created (and contributes to) the product they support.

bcwood• 17 years ago

I don't necessarily mean that the business would have to go to a fully-paid model, just that they will have to find some other way of adding value to their product, be it support, training, or add-on features or services.

If this type of business model doesn't match with what you want to be doing, then maybe open sourcing your product isn't the right move for you.

known2• 17 years ago

Open sourcing will destroy your business model if you focus on Competitor instead of Customer.

Loic• 17 years ago

Best comment ever.

known2• 17 years ago

Thank you.

omouse• 17 years ago

No, unless you start giving away the product for free.

pmichaud• 17 years ago

Of course it doesn't! He touched on the reason -- the way your product works is not a business. If a car manufacturer open sourced all of its data -- everything about the car, everything about the equipment they use to build the car, etc, then nothing would happen. A competitor might co-opt some of that information to improve their business, but no one who would have purchased a car from them would use the information to build a car themselves.

I know the analogy isn't perfect because of hardware overhead and whatever, but it basically holds -- the customers who spend money have only a tiny overlap with customers who want to install and change your code.

billswift• 17 years ago

If open sourcing your product will destroy your business model, then someone else creating an open-source version of your product will also. If that seems possible to you, then you probably should do is to try to transfer your business model to something that is resistant to those sorts of problems, that way if someone does create a competitive program, you are still okay. And you may decide to open source your own program to get the any benefits for your own program, rather than losing it to an open source competitor.

Does open-sourcing your product automatically destroy your business model?

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