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Home business models

Open Source is Business

by Dana Blankenhorn
September 7, 2021
in business models, business strategy, ethics, history, innovation, intellectual property, Internet, investment, open source, The 2020s and Beyond
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TuxOpen source was born at a time of high tech unemployment.

In the wake of the dot-com bubble bursting, early this century, the ideas found in Eric Raymond’s The Cathedral and the Bazaar found salience. The more eyes you could get on the code, the higher you could build the stack. This created competition for proprietary software. Anyone could build off the common framework.

Open source built the cloud, and the 5 Cloud Czars came to dominate it. They all use open source, but in a proprietary way. They support only the projects they’re using or those they’re seeking access to. In the 2010s developers all found jobs, often at 6-figure salaries, often dripping with stock options and grants. The idea of sharing with others went out of fashion.

Open core was one way to get around the open source idea. The center of the stack was shared, but everything the sponsor built above it was theirs. While small companies that did this ran into criticism, the fact is that if a stack has a commercial sponsor, the software is open core. The sponsor is building proprietary tools on an open source stack and calling it support.

Today, most contributions to open source have financial motives. Companies are trying to get access to the full stack, connecting their own stuff to the stack, and the core of the stack is enhanced mainly by its commercial sponsors. Programmer time is expensive. No one works for free. Young programmers may start their careers contributing to an open source program, but they’re quickly snapped up and go to work making money.

Thus the decision by LiveCode to “abandon” open source, putting their old code in an archive and building proprietary above it, drew headlines but it’s not really a story.

Because everyone is doing it.

Tags: cloud softwarecloudsopen sourceopen source historyopen source softwareproprietary softwaresoftwaresoftware history
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Dana Blankenhorn

Dana Blankenhorn

Dana Blankenhorn began his career as a financial journalist in 1978, began covering technology in 1982, and the Internet in 1985. He started one of the first Internet daily newsletters, the Interactive Age Daily, in 1994. He recently retired from InvestorPlace and lives in Atlanta, GA, preparing for his next great adventure. He's a graduate of Rice University (1977) and Northwestern's Medill School of Journalism (MSJ 1978). He's a native of Massapequa, NY.

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I'm Dana Blankenhorn. I have covered the Internet as a reporter since 1983. I've been a professional business reporter since 1978, and a writer all my life.

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