Subject: Re: Open Source funding?
From: "Stephen J. Turnbull" <stephen@xemacs.org>
Date: Sun, 20 Feb 2005 02:40:21 +0900

>>>>> "Ian" == Ian Lance Taylor <ian@airs.com> writes:

    Ian> Lajos <lajos@galatea.com> writes:

    >> 5) the volunteer non-profit model built around a product
    >> (Apache, ObjectWeb) with unpaid or paid volunteers

    >> 6) the volunteer non-profit model built around a product
    >> (Apache) with only unpaid volunteers (SourceForge-type
    >> projects)

I don't see any "products" here in the business sense.  The projects
freely give away everything they have to offer, but make no commitment
to even answer the phone tomorrow.  The users contribute this and
that, but nobody is turned away for failing to meet a commitment to
contribute.

There are lots of nice things about these models, but being "business
models" isn't one of them.

    >> What interests me most are the #5 & #6 models. Neither of these
    >> are VC funded, because they have no profit motives.

True, as far as it goes.  However, VCs are happy to accept risk in
return for high return, and if a smart CTO for a venture business says
"we can get better IT for less money by supporting an OSS project",
they will probably go with it.  Indirect funding is definitely
possible, especially for "reference implementations" of protocol
standards, etc.

    >> However, these are often the models in which some of the best
    >> open source software is developed.

Best by what metric?

Also note that these are models in which some of the worst software
(by _any_ metric) is developed.

    >> With the #6 projects, however, I frankly wonder how long they
    >> can last.

Forever.  The software doesn't go away unless it's so boring that
nobody ever downloads it and the owners then destroy the archives for
the shame of it all.  Is this a loss?  ;-)  #6 projects can go
dormant, they can be obsoleted, but die from malnutrition, no.

    >> A cyncial predication would be that this project will
    >> eventually be muscled out by a VC-backed competitor along the
    >> #1/#2 model. This I don't like.

Yeah, well, it's a disgrace that NBA and major league ballplayers are
in the Olympics, too.  There are lots of excellent athletes who simply
prefer to remain true amateurs, and for that reason they are rarely
going to be able to compete for Olympic gold.

Which would you prefer: a world where the project remains best in its
class but never does get completed?  Or a world in which it gets
out-competed, and relegated to watching from the sidelines?  If the
former, how do you justify that to those users who simply don't care a
fig as long as the product works?

    Ian> (Although I do want the question the notion of lacking
    Ian> muscle.  What are we talking about here?  More programmers?
    Ian> A bigger Q/A team?  GUI designers?)

You can get all of those from "the community".  To turn something into
a product that reliably generates revenues, you also need a model of a
customer, you need to market to that customer, and you need legal and
management staff, all things which technical people are notoriously
bad at.

    >> Frankly, I don't trust the industry (yes, I can hear the free
    >> marketers on this list gasp).

Don't troll; trust is not what free markets are about.  Free markets
are about the paying customers getting what they want, and in this
case there are well-known problems in arranging for payment.  Market
failure is written all over this industry.

    >> If we just rely on what gets funded, or what names the Wall
    >> Street companies see in the open source marketplace, a ton of
    >> really good stuff is going to go down the toilet. And with that
    >> goes a lot more that is part of open source as a movement, I
    >> think.

    Ian> As I implied above, I don't see how that can happen.  Good
    Ian> free software will not be lost.  Bad free software will be.

Very simple---the good free software will never get written, or at
least not ever turned into a "product" in Fred Brooks's sense.  The
problem that OSS suffers from is very similar to the problem of the
medical market: the paying customers don't know what they want; they
depend on the sellers to prescribe it to them.

This is one important reason why software like a patchy httpd and OSS
kernels can attract so much excellence, while it took a megacompany to
produce a satisfactory office suite, and they're apparently taking a
bath doing so (if not, we're all in the wrong thread!)  All it takes
to turn a kernel into a product is a bit of tar and twisted pair.
Doing the same with an office suite requires shrink wrapping machines
and a few hundred support operators behind an 800 line.

While I don't particularly fear it myself, I think Lajos's scenario is
plausible.

    Ian> So any programmer considering seeking funding of some sort
    Ian> should be asking "what will it do for me" and "what will I
    Ian> have to change in order to get it."  There is no one answer.
    Ian> It really depends on the people involved, and what their
    Ian> personal goals are.

Well put, as usual.

    Ian> [A free software project is n]ot so different from a company
    Ian> trying to get wide adoption of a program, actually, except
    Ian> that the free software developers have the benefit of low
    Ian> cost.

Only if they plan to do without legal, marketing, management, and
retail distribution channels.  And even then Steve McConnell would
disagree with you.

I really have to wonder if free software is particularly low cost.  I
strongly suspect the costs just don't get measured in dollar terms,
any more than the benefits do.

-- 
Institute of Policy and Planning Sciences     http://turnbull.sk.tsukuba.ac.jp
University of Tsukuba                    Tennodai 1-1-1 Tsukuba 305-8573 JAPAN
               Ask not how you can "do" free software business;
              ask what your business can "do for" free software.