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04/14/2005

Is Open Source Becoming Over-Sourced?

Is it just me or does just about every start-up software company have some kind of open source angle to their story these days?  I can’t count the number of start-ups that I have talked to recently that have the following business plan:  1) We have developed a core piece of amazing software 2) In an effort to make gullible, civic-minded developers around the world donate thousands of hours of free development time to our commercial enterprise we plan to declare that our amazing software is “open source”.  3) Once said gullible developers have freely helped us build out a real application, we plan to lure even more gullible corporations with the promise of “free” open source software only to become fabulously wealthy when said corporations determine that they must give us tons of money for support and maintenance of said software.

Truth be told, I have actually found some of these businesses to be very interesting, but others seem to believe that building a successful software company is simply a matter of changing their domain name from software.com to software.org and waiting for the money to roll in.

Granted, I can see how “grand scale” projects such as operating systems, databases, app servers, and other core pieces of infrastructure software are high profile enough, intellectually challenging enough, and broad enough to attract a large following of open source developers (and serious corporate sponsorship).  However I have a harder time seeing how this applies to niche oriented infrastructure projects and especially to applications.   Is there really a critical mass of idle/motivated developers readily available to pitch in for every conceivable niche software project in the world?  Are developers really so stupid that they will devote all their free time to making someone else rich?

Ultimately I think a lot of these niche plays in Open Source may end up becoming what I’ll call “Over-sourced”.  Sure they may succeed in generating some initial interest in their open source project on check processing software or linear optimization, or what have you, but they will never be able to generate the kind of broad based community support that is critical the long term success of the project.  As a result, their open source community will ultimately fade away and leave them (and their customers) holding the bag with a bloated code base and panicked customers.  Of course that outcome may not be so bad for some of these open source companies as their customers will have no choice but to contract with them for support and they will thus ultimately end up looking like any other mature enterprise software company.

It is in this way that I think Open Source is really just becoming a marketing gimmick for many start-up companies.  It gives them a way to lower the perceived risks of dealing with a start-up by addressing issues such as vendor lock-in and up-front investments head-on.  There’s nothing wrong with that and there are definitely a lot of situations where such an approach might work, but there’s no need to talk a lot of BS about leveraging free development talent and giving away free software because everyone knows there’s no such thing as a free ride, even in the land of open source.

April 14, 2005 in Open Source, Software | Permalink

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The thoughts and opinions on this blog are mine and mine alone and not affiliated in any way with Inductive Capital LP, San Andreas Capital LLC, or any other company I am involved with. Nothing written in this blog should be considered investment, tax, legal,financial or any other kind of advice. These writings, misinformed as they may be, are just my personal opinions.