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July 14, 2008 10:37 AM PDT

Cash- and code-based software economies

by Matt Asay
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Jim, where are you when we need you?

"Jim," of course, is Jim Whitehurst, CEO of Red Hat. The need? To get more enterprises contributing back to open source. Forrester has found that--Surprise! Surprise!--most enterprises consume open source but don't contribute back to it.

This isn't surprising, nor are the reasons and means of adoption:

"...[O]pen source adoption initially focused on the operating system and Web server tiers of the application platform stack, but early success widened the focus to include development tools, infrastructure components such as application servers and databases, and higher-level components such as portal servers and content management systems."

Lower cost was the main driver for open source deployments with delegates questioned by Forrester highlighting that the cost-based business case was easier to show for lower-level commodity middleware components.

Cost is a primary driver of open-source adoption, and for good reason. For example, Activision recently noted in a Webinar that it had saved "tens of millions of dollars" by going with Alfresco for its Web content management needs, while simultaneously driving innovation and flexibility.

That's great. But there is still the ominous note in the article above that support alone doth not a billion-dollar software company make. What happens in subsequent years when the cost savings have been realized but the enterprise is self-sufficient?

Wild rejoicing in the street for the enterprise, no doubt, but also abject poverty in the vendor ranks?

Clearly, there has to be a middle ground. We're inching our way there, slowly but surely. But we're not there yet.

In the meantime, I'm hoping that Jim can help enterprises to start contributing code to the commercial and organic open-source communities from which they derive benefit. It's not cash, but in some cases it's actually more valuable than cash.

It would be ideal to have both cash and code serving as the currency of exchange in the software economy. We've got a long way to go...

Matt Asay brings a decade of in-the-trenches open-source business and legal experience to The Open Road, with an emphasis on emerging open-source business strategies and opportunities. Matt is vice president of business development at Alfresco, a company that develops open-source software for content management. He is a member of the CNET Blog Network and is not an employee of CNET. Disclosure. You can follow Matt on Twitter @mjasay.
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by lmasanti July 14, 2008 11:34 AM PDT
When you "give away" something it is because:
1) It has not value/use (at least for you);
2) You do not want a return for your work/time spent; or
3) You want to do charity.

As far as open-source, the first is typical of some projects; the second, I won't enter into your personal problems...
And for the third, why people that give away are asking for money?

Where is the "free" part if I'm obliged to give back?
For me, GPL license means that "I pay giving back". I do not pay in money, I do "decide" about the "price" (what I give back)...

But free like in freedom?
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by CmdrRickHunter July 14, 2008 11:47 AM PDT
The problem is simple. A person's free time can be given to a project. However, a company has to pay an employee to go through the hoops to get code submitted. And then there's the issue of ownership: how does one explain to a VP why they should give away product?

Current buisness is orthogonal to Open Source.
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by WBColo July 15, 2008 8:45 AM PDT
I fail to see the problem. Open source software is written by people who like to stay up all night writing code. I prefer to get my work done during the day, with the help of open source products, and do other things at night. Everybody wins.
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About The Open Road

Matt Asay brings a decade of in-the-trenches open-source business and legal experience to the Open Road, with an emphasis on emerging open-source business strategies and opportunities. Matt is general manager of the Americas division and vice president of business development at Alfresco, a company that develops open-source software for content management. He is a member of the CNET Blog Network and is not an employee of CNET. Disclosure.

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