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Predicting the Future: Choose Software From Column A or Column B
Saturday, May 28 2005 @ 04:42 PM EDT

Here's a contrast in outlooks. First, we have Eben Moglen, who sees the future as going back to the beginnings of software development, when everything was open and free:

The lawyer for the Free Software Foundation said during a keynote at the LinuxWorld Summit that the IT world will return to a time before large businesses co-opted freely licensable software for proprietary products. . . .

But Moglen said the Free Software Foundation and the Software Freedom Law Center he chairs are trying to return software to its glory days of shared development.

The lawyer, also a professor of law and legal history at Columbia University Law School, said the time has come to again treat science like physics or chemistry, by promoting a free exchange of ideas the way Galileo Galilei proposed.

Then we have Steven Henry, who is also an attorney, who predicts the closing down of the FOSS faucet to a proprietary trickle. Open Source, he claims, is being coopted by business. They want to shut off the openness and instead hire some programmers to do "open source" coding.

No. Really. Don't laugh. That's what he said, that in the future "there will be little difference" between how proprietary and "open source" software will be developed.

Part of Groklaw's purpose has to be to kindly explain FOSS, so these business folks, and their lawyers, can make some progress, hopefully before they kill the Golden Goose. What Mr. Henry is proposing would kill the Golden Goose, that cash cow, Linux. Why? Let me simplify: Because the strength of Open Source is that it is open. I guess we'd better review some fundamentals. It's not "Open" Source unless it's . . . well, "open".

Here's his chilling forecast:

With the embrace of open-source by big business, cultural changes are coming along with the adoption. "Open-source is no longer a grass-roots movement. It has been co-opted," he said.

Because of this change, open-source software is no longer developed by communities using Eric Raymond`s bazaar model of development.

"The idea that a software community is there for all open-source projects is no longer true," said Henry. Instead, companies now employ developers to write open-source programs.

In these cases, "if a company that makes an open-source package abandons it, it's abandoned."

In five years, Henry predicted that open-source revenue will overcome the free software religion. "Linux might be the first, biggest and perhaps only major bazaar-style open-source development project to get traction in the commercial sector," he said.

In the future, open-source and proprietary programs will be competing on an even playing field and there will be little difference between how they will be developed, he said.

So, his vision of the future of Open Source is that it will have no future. Businesses will grab Linux, make a buck, and that's the end of that openness junk. I hate to burst his bubble, but businesses don't control Linux or Open Source or Free Software. Nothing they do will change that. Not now, not in five years, not ever.

It is so hard for proprietary companies and their lawyers to grok FOSS. It goes against all their trained habits. They see Linux is taking over the world, but they don't get why that happened, so their flat-footed plan is to carefully destroy what made Linux so wonderful in the first place.

Businesses that want certain features in Linux can cooperate, can hire folks to donate code, etc., but if they think that their contributions are what is making Linux or GNU/Linux hum, they are wrong. Businesses are jumping on a train that already left the station without them on board, and even now, they are passengers, not driving in the front car.

The quality of FOSS comes from two things businesses can't provide or arrange: Linux, to use it as the example, attracted many of the world's finest coders precisely because it is a meritocracy and because there is no schedule imposed from above on when code has to go out the door. It is ready when it's just right. That appeals to the artistic side of an engineer. It feels good to do quality work. And it feels good not to have to compromise due to marketing pressures. Coding for the fun of it results in a very different end result than coding for money.

I'm not saying there is no place for proprietary software. There may well be needed functionality no one feels like doing for love, or specialty funtions that no one happens to have done or wants to do. But I am saying that coding for love results in different code than hired code. It's like your mom cooking your favorite meal as opposed to eating out at a chain fast-food restaurant. Sometimes you feel like a Mac, but it can't hold a candle to Mom spending hours out of love to please you with just what you particularly like.

And second, because Linux is open to anyone to suggest or offer patches, the talent pool is beyond what any one company can afford to hire. New coders come along every year, so shutting the door at any point to that new talent is counterproductive.

Nothing can change either of those two factors. They are what they are. Folks who code for the sheer pleasure of it, to solve a problem, to make software do what they want, code differently than someone who is told what to code and how and when for a salary.

For those of you who imagine Microsoft could hire more programmers, or think that it's only 100 people doing all the heavy lifting, so who needs the rest, here's a word from Moglen:

Moglen said users who need software can find an abundance of code to use for software building in online machine tool shops, such as SourceForge. In that community, he said some 95,000 programming projects are being worked on by roughly 490,000 programmers in their spare time.

To gauge how productive SourceForge and the open source community can be, he created a metric where if one subtracts the amount of people at Microsoft who don't make software (those who sell products and other corporate cogs), SourceForge is currently equal to 1.35 Microsofts.

By the end of the decade, that figure would see SourceForge equal 3.7 of the Redmond software giants, he estimated.

I don't know why that is so hard for folks to grasp. The winning team is obvious now. But they keep trying to take Linux, as it is currently, now that it's a success, and euthanize it, so they can control it, put it in a box and sell it the old-fashioned way, like an iron or something.

Here's their first lesson: enterprise software licensing is a dying business. That link will take you to an article, "IT Execs to Vendors: Your Software Stinks", ironically showing an ad for Microsoft. Instead of trying to emulate a dying business model, do what is replacing it, like the rest of the world, GNU/Linux. Think about why Linux developed as it did. Hint: it wasn't run or controlled by any corporation. That was a feature, not a bug.

And no matter what business does, FOSS will continue, just as it did the first time they tried to kill it, thanks principally to the vision and ethics of Richard Stallman. The happy days for proprietary software vendors when software customers were too dumb to know any better are over. We all saw what happened when business took software and closed it down. We got lousy, buggy software that in some cases costs more than the hardware it runs on, software that opens us up to viruses and spyware and malware of dizzying variety. And we can't fix it. All we can do is hope Microsoft or other proprietary vendors will do it for us.

Should Mr. Henry's crazy prediction come true, it won't matter to the rest of the world at all. We'll just see FOSS continue to outcode proprietary software products, including the ones nominally called "Open Source". Brand X never does that well, you know. That's because there ain't nothing like the real thing, as the song says. And you know why it's real don't you? It's precisely because it isn't written by big businesses, with their self-absorbed, narrow marketing world view gumming up the works. That's why the world trusts GNU/Linux systems, you know. Seeing the code is vital, without a doubt, but that isn't all there is to it. China was allowed to look at Microsoft's code, and they still decided to go with GNU/Linux. You should never use software you can't trust. It's way too important. And there is more to trust than being able to examine the code.

Why businesses are the very last to grasp that vital truth is, frankly, a mystery to me. But the rest of us get it. And we are who they have to sell to.


Predicting the Future: Choose Software From Column A or Column B | 139 comments | Create New Account
Comments belong to whoever posts them. Please notify us of inappropriate comments.
Authored by: IRJustman on Saturday, May 28 2005 @ 06:31 PM EDT
Post 'em if ya got 'em.

[ Reply to This | # ]

  • Corrections - Authored by: LarryVance on Saturday, May 28 2005 @ 07:07 PM EDT
    • Corrections - Authored by: PJ on Saturday, May 28 2005 @ 07:12 PM EDT
  • typo - Authored by: Anonymous on Saturday, May 28 2005 @ 07:17 PM EDT
  • Corrections - Authored by: Anonymous on Sunday, May 29 2005 @ 06:46 AM EDT
OT linkage
Authored by: IRJustman on Saturday, May 28 2005 @ 06:33 PM EDT
Make sure you post as HTML, anchoring appropriately.

[ Reply to This | # ]

Cognitive dissonance
Authored by: Griffin3 on Saturday, May 28 2005 @ 06:45 PM EDT

Is it just me, or do Mr. Henry's statements just not make sense? Perhaps the way in which he thinks of "open source", there is a logical framework for such statements, but for the rest of it, it isn't so much a bad prediction, it's ... nonsensical.

In the future, open-source and proprietary programs will be competing on an even playing field and there will be little difference between how they will be developed, he said.

Either he is saying that all companies will be writing open-source software, and not bothering to keep code secret, or he is saying that the companies will take the open-source code and release it as modified binaries, and this forking will somehow make the "free" product vanish from the earth. The young man just isn't making sense; that, or he's defining these some of terms in a different way than the rest of us. In either case, it comes out like "freedom is slavery", maybe, or "war is peace".

JTOL, Glenn

[ Reply to This | # ]

Predicting the Future: Choose Software From Column A or Column B
Authored by: nadams on Saturday, May 28 2005 @ 06:52 PM EDT
I think that in the future you will see two types of software development:
  1. Proprietary software developed in-house for use in-house
  2. Free/OpenSource Software
Once businesses become really savvy to the economic benifits of F/OSS, the only proprietary software they'll be willing to stomach is their own! i.e. They will demand that any software developed by a 3rd party be F/OSS to avoid vendor lock-in.

[ Reply to This | # ]

Off Topic
Authored by: pfusco on Saturday, May 28 2005 @ 07:05 PM EDT
This is probably way off but it seems to fit the article a little...

Recently my work has given me a certification course from Dell that I need to take, I signed up and tried to access it from my home PC where I run Suse Linux Pro 9.3 and use firefox as my browser.

I could not access the course site... it began to load then die out so I used their online helpdesk chat system and found out it was accessible through Internet Explorer only.

Correct me if I am wrong but wasnt this issue supposibly taken care of by the Anti Trust rulings and also, Isnt it illegal to post sites that have the content inaccessible by differing browser types? And also, isnt the World Wide Web Consortium post specifications about just this sort of thing?

Im guessing it is active x issue as opposed to the use of java there, but be that as it may... The fact that I am unable to do my work because of this completely suxors

only the soul matters in the end

[ Reply to This | # ]

Predicting the Future: Choose Software From Column A or Column B
Authored by: gmelis on Saturday, May 28 2005 @ 07:07 PM EDT
In Greece there's a saying, going "all after-Christ-prophets are
donkeys". I think somebody should tell him that the end of Apple and VMS
are still pending, despite their repeated forecasts. So now he not only predicts
the end of FOSS but also the way it's going to come. Has anybody thought of
what's going to happen if India and China really get behind FOSS? Now there's a
pool of about 1 billion people, where the FOSS programmers come. What happens if
that pool becomes 3.5 billion?

[ Reply to This | # ]

Predicting the Future: Choose Software From Column A or Column B
Authored by: Anonymous on Saturday, May 28 2005 @ 07:14 PM EDT
I thought the statements of Mr. Henry which you quoted, make total sense. I
think you're reading overtones into them which aren't really there. He's
talking about OSS in general, not just about Linux. Linux is not necessarily a
good predictor of how other OSS projects will go (Linux is unique and uniquely

There might be 95,000 projects on SourceForge, but probably only 1,000 of those
are stable and interesting and have a healthy community grown up around them.

It's true that large companies like IBM now have hundreds of their salaried,
full-time employees working on OSS projects which are of interest to IBM. There
will be more similarity between future OSS development and current proprietary
development, than most people would like to admit.

However, the difference is that if a proprietary company loses interest in
participating, they can take their ball and go home (e.g. Larry McVoy's
Bitkeeper). If its an OSS project, they can go home but they leave the ball in
public and others are free to pick it up where the former contributors left

Ultimately, a world where businesses can use open-source codebases to accomplish
their business goals, is a good thing. If they need support or customizations
or bug fixes to the codebase they can just hire some programmers to work on it.
They aren't locked into a closed-source proprietary vendor offering and at the
mercy of the single vendor's schedule and whim.

[ Reply to This | # ]

Has someone ignored Nancy's advice?
Authored by: Anonymous on Saturday, May 28 2005 @ 07:15 PM EDT
Understanding Professor Moglen position is relatively easy, even if you are
opposed to it. However, the other argument has a ring of 'newspeak' to it.

[ Reply to This | # ]

Predicting the Future: Choose Software From Column A or Column B
Authored by: tredman on Saturday, May 28 2005 @ 07:40 PM EDT
In "The Cathedral and the Bazaar", by Eric Raymond (in my opinion,
absolutely required reading for anybody doing anything with open source
software), his very first lesson goes like this:

"Every good work of software starts by scratching a developer's personal

Therein lies the problem with proprietary software, whose restatement of that
rule says:

"Every good work of software starts by scratching what we perceive as the
typical user's personal itch."

I found out a long time ago that many major corporations, for all of their paid
studies and focus groups, really don't have much of a clue what the average
person's personal itch is. My favorite example of that is the hoopla
surrounding desktop search. I think most software houses overestimate exactly
how much their users want and clamor for desktop search. In a similar vein is
Microsoft's proposed file system based off of SQL Server.

When you're in the business of trying to one-up your competitors, it becomes
easy to be blinded to the true, simple needs of your customers. I think a
database-oriented file system is an interesting idea, but there's a reason that
it's been pulled from the ever-dwindling list of Microsoft Longhorn features.
It's just too complex, and complexity breeds bugs.

When it boils down to it, people just want it to work. Most users aren't
impressed with why or how it works. They just want the simplest solution to the
problem at hand. Anybody who says otherwise is either a geek (like me) who's
been fascinated with buttons, switches and knobs since a child, or the
prototypical corporate power user who uses the fancy capabilities as a badge of
status and a way to one-up the people around them.

Sorry. Got stuck in rant mode there for a second.

"I drank what?" - Socrates, 399 BCE

[ Reply to This | # ]

Predicting the Future: Choose Software From Column A or Column B
Authored by: freeio on Saturday, May 28 2005 @ 07:53 PM EDT
The first and greatest error made by such individuals is their insistance upon the concept of open source rather than free software - that is free as in freedom.  Free software is a hard concept for those who would "monetize" everything to comprehend.  Their built-in assumptions deprive them of the ability to see what is right in front of their eyes.

For free software to disappear it would require that all of us stop participating in its development, use, and propagation.  I cannot speak for the next generation, but I can assure you that in this generation we have so many of us who have burn marks from proprietary practices that we simply will not be conveniently misdirected away from free software.  Everyone I work with knows I use it, and I spread that particular gospel to as many as will listen.  And yes they listen.

But enough of this.  Rather than continue with mere words, it is time to get back to developing free software and hardware designs.


Tux et bona et fortuna est.

[ Reply to This | # ]

New technology is destabilizing
Authored by: Anonymous on Saturday, May 28 2005 @ 08:43 PM EDT
Propriatary software companies need to predict the death of open source. It is
doable to keep track of a finite number of competetors and the inovations that
they produce. FLOSS developers are virtually infinite, and new or revolutionary
features are impossible to predict.

The possibility of new technology are why the X (flight) program needed to be
canceled and why the ABM treaty was needed, new technologies were destroying the
assumptions behind MAD (Mutually Assured Destruction).

In the same way, it is imperative for propriatary software companies to destroy
the open source community. The level of inovation from open source is
unpredictable (and fast) so closed source companies have no chance of remaining
competetive, long term.

Make no mistake, propriatary software companies must either adapt to free
software or become extinct. The better companies know that. You can see which
side of the bar their chips are on. We don't need to pay much attention,
however. As long as we keep programming, evolution and nature will take care of
the rest.

-- Alma

[ Reply to This | # ]

Steven Henry: redefining the word Wrong
Authored by: SilverWave on Saturday, May 28 2005 @ 08:57 PM EDT

Steven Henry: redefining the word Wrong

Wow to be this badly informed takes work!

Steven you really need to understand your subject matter better before making pronouncements as you have, or you will just get laughed at...

...I mean you have so obviously not done any serious research.

You then flaunted this lack of basic knowledge by offering such a patently flawed theory.

Quote: "if a company that makes an open-source package abandons it, it`s abandoned.""


Just incase you are for real and not another "rent a rant" here are a couple of points for you to consider:

1. The GPL means that no one EVER gets to control the software in the way you believe is possible.

2. The value proposition of FOSS software, like LINUX, is that no person/companiy(s) can pervert it... you can just fork man!

Oh and Quote: "economics to prevail over doctrine."

Yes this is true BUT the economics are that of the commoditisation of most software, which will mean no more monopoly pricing & lock in.

"They [each] put in one hour of work,
but because they share the end results
they get nine hours... for free"

Firstmonday 98 interview with Linus Torvalds

[ Reply to This | # ]

Branding: a double edged sword
Authored by: justjeff on Saturday, May 28 2005 @ 09:23 PM EDT
A while ago, there was an effort to get the community to constantly use the
term "open source." It has been reasonably successful. A lot of
people talk about open source, and are even starting to use acronyms
"OSS" and "F/OSS."

The problem with too-successful branding is that the name becomes just a name
and loses its meaning. Ask Xerox. People who think that open source software
and projects will simply be bought or annexed or absorbed into some big business
don't understand that free software is free and open source software is open.
They just see it as another brand name. Like "Xerox." The branding
has worked. "Open source" is just a name.

Of course, various proprietary software houses calling their proprietary
products "OpenThis" or "OpenThat" hasn't helped either.
"Open" has become so ubiquitos that its meaning has become diluted and
overlooked and/or ignored.

[ Reply to This | # ]

Predicting the Future: Without a hint of history
Authored by: the_flatlander on Saturday, May 28 2005 @ 09:40 PM EDT
In five years, Henry predicted that open-source revenue will overcome the free software religion. "Linux might be the first, biggest and perhaps only major bazaar-style open-source development project to get traction in the commercial sector," he said.

I'm sure Linux will be one of the biggest... but has this guy ever used, oh, I dunno, say, that internet thingy? I'm thinking most all the web-servers out there are running Apache; that seems pretty big to me. And everybody I know is coding in Perl. And Firefox seems to be doing pretty well for such a young project... PHP? MySQL? The GNU Tools? (GCC, EMACS, vi, gdb, less, ftp, I could go on.)

The Flatlander

The thing about ignorance is that the afflicted are completely unaware of their ailment. (And, yes, I know only too well that that can, and does, apply to me as well, but at least I don't make speeches to crowds of people that know more about what I'm talking about than I do.)

[ Reply to This | # ]

Predicting the Future: Choose Software From Column A or Column B
Authored by: Stumbles on Saturday, May 28 2005 @ 10:18 PM EDT
It's not "Open" Source unless it's . . . well, "open".

The obviousness of some statements elude even the most "educated" people.

You can tune a piano but you can't tune a fish.

[ Reply to This | # ]

Henry's got some points, but he's missing something.
Authored by: Anonymous on Saturday, May 28 2005 @ 10:25 PM EDT
I think he's probably, in a significant part, right about a lot. I suspect that
a large number of companies are going to start producing open-source code, and
that a lot of it is going to be projects where the company programmers are
pretty much the entire development team and the project will effectively die of
abandonment if the company stops paying them to work on it. I think he may even
be right about the idea that those sorts of projects will become signficantly
more numerous than volunteer-driven or collective-driven open-source projects of
the sort that we currently consider to be the defining type of free software.

But what he's missing is this very crucial piece: Those projects will not take
anything away from the volunteer-driven software movement. Even though they
might outnumber it much like commercial software outnumbers it (in my
estimation) today, they will mostly just serve to strengthen it.

And the fact that "most free software", in his hypothetical future, is
commercial projects dependent on commercially-paid interest, is going to matter
about as much as the fact that those statistics are true of "most
software" today. Volunteer-based free software simply doesn't need to be a
majority of the market in order to be perfectly healthy.

[ Reply to This | # ]

Gov't Funding
Authored by: Anonymous on Sunday, May 29 2005 @ 12:31 AM EDT
Ah yes, back to the days when the government funded advanced projects like

Back to the days when you couldn't get a government contract unless you were
willing to adhere to standards. Ah yes those were the days.

[ Reply to This | # ]

Lawywers Don't understand Closed Source
Authored by: Anonymous on Sunday, May 29 2005 @ 03:06 AM EDT
Oh. sure, they can think if the legal concept of "intellectual
property" ant thus conceive of a completed proprietary program as a thing
of value, but a lawyer's training makes it difficult to understand the process
of closed-source development.

IANAL, but the actual practice of law seems to depend fundamentally on a
open-source model. Lawyers routinely access, use, and contribute to a vast body
of case law, and contracts tend to consist of mostly stock paragraphs.

Open-source programmers work the same way. Closed-source programmers are
theoretically prohibited from working this way.

[ Reply to This | # ]

PJ distorts Henry's remarks
Authored by: Anonymous on Sunday, May 29 2005 @ 04:51 AM EDT

By selective quotation, PJ has given an entirely false impression of Henry's thoughtful presentation.

Henry is not pro- or anti- free software, or commercial software. He's presenting a view of conflicting economic forces in the world of software development. Of course there are companies which are developing their own non-free "open-source" licenses; that's not Henry's opinion, it's fact. Henry does not say whether he likes this or not. He's just commenting on what he sees. If you think it isn't happening, get your head out of the sand (or wherever it is).

It's difficult to foresee what the software scene will be like in the future, but it's a pretty safe bet that various licenses will coexist - from 100% proprietary to 100% permanently free (GPL), with lots of "open, non-free" licenses in between. That's really what Henry is saying. His message is probably as unwelcome to the proprietary zealots like Steve Ballmer as it is to the "free" zealots like Stallman and Raymond. Here's a clue: somebody who annoys the extremists at BOTH ends of the spectrum is usually worth listening to.

Now, personally, I hope that most software will be free. I certainly don't use any other kind, when I have a choice. But to believe that all proprietary software will go away is just naive.

[ Reply to This | # ]

Predicting the Future: Choose Software From Column A or Column B
Authored by: Anonymous on Sunday, May 29 2005 @ 05:25 AM EDT
IT lawyers do not get it
Traditionnal software houses do not get it.

But I can tell you corporations that buy software and IT services do get it all
right. FOSS in these corporations is 95% about breaking vendor lock-in, not
price or quality (side-effects). So they do understand very well the
"contributing back" part. Without it they are wed to a vendor and
they've seen firsthand what *that* means.

All the people that clamour about corps not caring a bit about openess in
software are deluding themselves. *They* do not care about it because they've
built their businesses on code/patent scarcity. And they're about to get a very
painful surprise. Big corps are slow to move but when they do move it's
difficult to stop.

[ Reply to This | # ]

who drives the train?
Authored by: Anonymous on Sunday, May 29 2005 @ 05:28 AM EDT
Well, a bit of bias is here.
IBM is an active passenger and a well-built one :)
In my opinion they shoveled a lot of coal in the engine.
And i think they had some suggestions about where the new rails go, as well.
I'm sure that Linux (on my desktop) could live well without IBM, or even without
all of the big contributing companies. But they definitely did help Linux in
Check the statistics of contributors.

The problem with Henry is that he thinks all FOSS programmers will be bought out
simultaneously and forever and they won't funnel new improvements back. Luckily
most projects got more than a single programmer, and GPL is strong enough. Even
if they really want to kill the goose.

[ Reply to This | # ]

  • RTFA - Authored by: Anonymous on Monday, May 30 2005 @ 05:47 AM EDT
Train analogy
Authored by: Anonymous on Sunday, May 29 2005 @ 05:44 AM EDT
"Businesses are jumping on a train that already left the station without
them on board, and even now, they are passengers, not driving in the front

I view this analogy more like a train that's got a dozen or so different
locomotives pulling up front and a single passenger coach at the back for those
that don't yet get the idea.

[ Reply to This | # ]

  • Train analogy - Authored by: Anonymous on Tuesday, May 31 2005 @ 12:01 PM EDT
Buying software
Authored by: Tufty on Sunday, May 29 2005 @ 05:44 AM EDT
Why should't people buy software? Why not? If they like it, it does what they
want, why not? No problem and I hope the FOSS movement will not see it as a

On the other hand why not pick up software for free. I have used Freeware for
many years. Very good, liked what it does but would NEVER have paid money for
it, I have not needed it. If it had been connercial I would not have used it.
Shareware, yes I have tried and either abandoned or puchased. I also use paid
for, commercial software when I need what it does.

What I cannot see is why the different business models cannot co-exist. It
really bugs me. Gimp is good and does some things better than my Paint Shop Pro.
On the other hand I find PS easier for ME to use. Others may find differently. I
have no need to upgrade, spend money etc so I will continue to keep the version
of PSP that I have but monitor GIMP.

On the other hand I use Firefox as my browser. Why? I find it the best around
(at the moment).

It is the merits of a particular piece of software that need to be assesed NOT
the business model of it's distribution. People need to get real about Linux.
What is it's market penetration? Low. More box makers are taking it on,
awareness is growing. The figures will improve. The problem is that it is
PERCEIVED as geeky as opposed to Windoze's 'out of the box' persona. The merits
need to be changed.

A company can shop around to buy a piece of software to do what it needs but,
too often, the product is not available. What then? You get a developer in and
buy C++ or Pascal and they write the software from scratch, 0. Bespoke. Costly.

Once FOSS gains recognition it will be seen that a company can gain by using
existing packages and making local modifications. On the other hand new
developments find their way back to the community and the pool to pick from.

The emphasis changes from writing origial code to making it work for that
particular organisation. From writing and charging for packages to customer

Hardware has already gone through this. Just try setting up a shop selling PCs.
You will fail. The profit margin is too small. To produce enough machines to be
viable your staff saleries for assembly will exceed the profit over parts. Then
deduct returns. I've done the costings. PC box shifting is a loss.

On the other hand you can make a profit. Add in the service contracts, repair
bills, toner replacement, accessories etc etc then you have a working model.

FOSS is the same. The software becomes a bag of bits but the profit moves from
the software to what you do with it.

A Linux server with Apache abd MySQL may be free (software) but how much would a
company pay an expert to co what he wants? THAT is the key.

A good example is Web Site. No one needs to pay to set up a WebSite (over ISP
fees). Notepad or VI is all you need. How many people make good money building
web sites because of what they know and do not because they charge for the web
site software?

That is where FOSS is going. The aplication of the software. Hardware has
crossed from the sale to the support. Software needs to follow.

There has to be a rabbit down this rabbit hole somewhere!
Now I want it's hide.

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Dollars are not the only currency
Authored by: cricketjeff on Sunday, May 29 2005 @ 08:03 AM EDT
And in fact, currency isn't the only means of exchange. There are companies,
many companies, that think in the way this lawyer suggest. However in the end
they are bound to lose, because they are not using the most efficient means of
Software development is very expensive, both in programming and testing hours.
All over the world the same work is done time and time againin closed source
labs. Every one of them, or at least every one of them that is serious about
software development, pays these costs on its own. To finance this they have to
charge their customers proportionately.
The open source world uses two additional paradigms that allow its members to
outcompete the closed sourse crew in software development. We use the fruits of
our brainpower asa means of exchange directly, cutting out the middlemen, and we
don't demand a one for one exchange, so we don't need to pay bean counters.
The results are that open source companies pay their staff but they get a
workforce many many times larger. They don't get this free, they pay for it with
the brainpower of their staff. Some companies get back just two or three times
what they invest, others get many thousands of times their input. the system is
self healing and self balancing. Companies that don't "grok" the
system don't use it well and don't propser, those that do, do. Only very small
companies see the biggest leverage gain, but they either become big companies
and so contribute more, or they stay small and local and pay back in other ways,
by providing small local services that make their customers aware that OS
software and OS companies are the best partners for their businesses. They
don't, and can't, steal business from the larger players. The bigger companies
don't see quite such a large percentage gain from the bazaar but they do see
reliable, consistent and often very very large benefits. They also have to pay
in other ways, they lose control of their babies. However those of us who are
parents know that this is the way of the world, control of ones progeny is only
ever an illusion, they will takw their place in the world whether we want them
to or not. If we do our job well they will continue to enrich our lives even
when they have left. The smae goes for our software children, they will develop
their own communities that will usually include their original parent companies.
This metaphor is now getting rather stretched but I think I have made the point.

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Trying to apply Gresham's Law?
Authored by: joef on Sunday, May 29 2005 @ 03:15 PM EDT
Most law school and business school products have been exposed to Gresham's Law
which, in its original form, stated that "bad money drives out good."
It was formulated by a sixteenth century economist, Sir Thomas Gresham. He
observed that the precious metal coins that had shaved/scraped edges stayed in
circulation while the new, full-weight coins were hoarded. A big con at the
time was to file down the coins and melt down the shavings to sell as bullion.
It has been extended by many people in many contexts to explain why inferior
commodities often replace their betters in the market.

Perhaps the view held by Henry is colored by that concept: if the process is
co-opted by those motivated by personal gain, their product will in some sense
"drive out" the products of the more traditional FOSS process. He may
well have a valid point, for we have certainly seen such results in the twisting
of "open" standards, submarine patents, and the like.

But the best defense against that sort of activity is in the careful crafting of
binding agreements (e.g., the GPL) and in aggressively defending these
agreements when violations are observed. To do any less is to let Gresham's Law
run its course.

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The simple explanation
Authored by: Anonymous on Sunday, May 29 2005 @ 03:52 PM EDT
Dear PJ,

Most excellent blog. Unbelievable, however, that they are some who "still
don't get it".

Perhaps this "simpleton explanation" will help them:

There are the 3 general factors to consider in computing:

1) hardware
2) software
3) support

Hardware used to be expensive. People thought that was how they would make
money. They did for a while. No longer. Hardware is now mostly a commodity.
Dell, Gateway, China, ROC, et al.

Software. This is where we are now. At a point of transition from proprietary to
FOSS. Specifically, a transition by way of Linux. Proprietary has hit the top
point of the roller coaster and is on its way down. Unfortunately, it will fly
off the tracks when it hits bottom. Witness SCO's wide ride. It nears bottom as
we speak.

And, finally, support. This is where we are headed. The big money will be made
here by those supplying support. Software is becoming a commodity same as
hardware. IBM and others see it coming and they are onboard. Other will follow.
Misdirected individuals such as those employed by SCO, and Mr. Henry seem unable
to accept or even comprehend what is happening. They WILL be absorbed into the

So, one more time, Folks. First there was hardware which became a commodity,
Then came FOSS and Linux which allowed software to become a commodity, and
finally we all figured it out that support (which is another commodity) was all
that really mattered.

See how simple it really is? It's all about supplying something that a person
really needs. Support. Can you do it yourself? Some can and will. Some will sell
the service contractually and some will give it away. Support is were we are


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Proprietary software dead, film at eleven
Authored by: mnuttall on Sunday, May 29 2005 @ 03:55 PM EDT

The demise of proprietary software is not upon us.

Almost all software is customised or extended before deployment. Very little software does exactly what a particular customer needs. Every customer has their own business processes. Every customer I have ever met wants the software modified to fit their needs. Money must be spent to close the gap. Sometimes the in-house IT department gets the work and sometimes it goes to a contractor.

IT contracting work will keep proprietary software alive for the forseeable future. It will also contribute to the erosion of the divide between 'open source' and 'proprietary' software and to some extent the 'hijacking' or co-option of the former by bad old Big Business.

Let's me be the customer and you the contractor. I have, oh, $20m burning a hole in my pocket and some back-office systems desperate to be integrated with a range of suppliers and business partners. I've not signed your contract yet but I'm seriously considering it. I reckon I'll need to pay you $8-$10m for an initial build/deploy and maybe $2m per year for five years support and maintenance after that. Now look me in the eye and promise that this software, whatever it is, I don't care, will do exactly what I need for the next five years. Oh yes Mr Customer you nod of course you have my Word. Well what else could you say?

And still looking me in the eye I need to know that you will keep my secrets confidential. That my special Way Of Doing Business will not be made public that my competitors won't simply be able to download my business model off your website and undercut me, not having to pay $10m up front for development. Well Mr Customer you say, our solution is based on Linux which is licensed under the GPL and it runs on Apache and it's written in PHP but the actual application code that Does What You Need, well now... we have to talk about who owns that.

If I Mr Customer own the application code then it's a pure services engagement: we fall out, I stop paying you, I own the code. But now, I have to maintain it. And you the vendor must recover all your costs against this one engagement, which pushes up the price.

What tends to happen is that You the Contractor will take ownership of a layer of code between Apache and the final, customised application. You will maintain this and reuse it in many other engagements. This reuse will reduce your costs, and make you more competitive. Each customer will then own just the veneer on top of the code which is their custom-tailored code that's frankly of no use to anyone else anyway. So you cut your costs, edge out your competitors, and still promise to maintain My solution for five years AND keep all my secrets.

But now, you the contractor own this 'middleware' between the mass-open source layers of Linux/Apache/PHP and the totally one-off, per customer solution. You own it. You maintain it. It does what YOU need which is support you in your business of selling services to your customers.

You have two choices: (1) make it a product and sell it to your customers for license revenue, or (2) open-source the code and hope that you get more back from 'the community' than your immediate competitors (other IT services houses of the same size as yours) take away from you in competitive business.

Even under choice (2) what will happen in most cases is that no-one much will contribute to your code. What they do contribute will be in their own time, at their own pace, and completely out of your control. Code that comes in may be superb, or it may stink. Either way you have real customers wanting solutions delivered by hard deadlines on thin margins.

The truth is that you now own a proprietary product. Walk away from it, and it will die. Call it 'open source' if you like but the truth is, You are the major maintainer and without you this 'product' has no future.

Successful open source projects like Linux and Apache sit near the bottom of the 'stack': they're well-understood infrastructure components whose function is well-defined. Andrew Morton made exactly this point Last November. Software that is really, or just effectively, proprietary will retain a place in the middle of the stack for as long as there are customers and contracts. And these are with us to stay.

Film at Eleven? I'm not so sure.

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Open Corporate Fallacy
Authored by: arf on Sunday, May 29 2005 @ 07:36 PM EDT
Steven Henry's analysis has the same flavour as a piece by Rob Enderle about a month ago: (Technology News: Software: How Linux Saved Microsoft). Namely, that Openness will be so successful that big business will eat it up. It's a different tack, but based on the same false assumption. Here's an excerpt on what I wrote about Enderle's article:

"Here, despite carefully defining Linux as not a product, and categorising Open Source as being based on a false premise (people don't want to look at code), Enderle appears to fall into what I shall call 'the Open Corporate Fallacy': the notion that something like Open Source, as a whole, can be treated as a business offering, provided by a corporate entity that is subject to the standard market forces. It makes for easier analyses, but it is wrong. The reality is this:

  • Open Source is not a corporation: it is a variant of the Openness meme, and a very effective one.
  • Organisations like FOSS are manifestations of that meme, but they do not define or own it.
  • Linux is an instance of the Openness meme, not the meme itself.
  • Companies like Red Hat, Mandrake (or whatever they're going to call themselves) represent instances of a Linux distribution provider, not Linux itself. They make their profit from add-ons: training and consultancy.
Considering the dependencies of the above links, it should be clear that open source does not depend on companies, but vice versa. Individual corporations may come and go, but the concept remains."

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  • On FOSS - Authored by: jbn on Wednesday, June 01 2005 @ 04:45 AM EDT
Patents can (they imagine) make it so
Authored by: PSaltyDS on Sunday, May 29 2005 @ 10:48 PM EDT
"I hate to burst his bubble, but businesses don't control Linux or Open Source or Free Software."

I realy think business people actualy entrenched in the old model, as opposed to simply not having had it explained yet, believe that Software Patents will kill off the annoying FOSS'ies. Governments can do what the markets won't, and have been known to absolutely crush a minority group in favor of business groups they see as more useful. A few shakey decisions by pro-old-business judges, expanding, stretching, embracing, broadening the power of large businesses to exclude others with patents on simple ideas, and Linux could be wiped out. Software patents are the 'nuclear option' that large closed-source software houses are trying to figure out how to use without the fallout killing them too.

I'm afraid that, in the U.S. at least, they have reason to hope for getting their way. The EU doesn't impress either, with its willingness to dodge its own rules to enact something it evidently finds very appealing in Software Patents. They don't have to compete with FOSS if they can simply have it decared illegal or made hopelessly expensive in Patent Law on their behalf.


"Any technology distinguishable from magic is insuficiently advanced." - Geek's Corrolary to Clarke's Law

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