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The strange economics of open-source software
- justizin 11y ago"Behind all the REST endpoints, the AWS ELBs, and the HAProxy systems, sits some of most closely-guarded software in the world." I'm not sure, "closely-guarded" is the term I would use.
- nickpsecurity 11y agoI'm not sure I agree with the notion that OSS is where all the innovation is happening. There's certainly plenty of innovation there. But most innovation still seems to be privately funded developments (esp startups) which get open sourced. Or not. Has there been any empirical work on assessing it in recent times? Maybe post 2010?
- jlarocco 11y agoI agree. Innovation in open source is all on commodity computer stuff that developers understand, like operating systems, compilers, web browsers, and databases. For almost everything that requires other expertise the innovation is still done in closed source software. Stuff like photo editing (LightRoom, Photoshop, Capture One), video editing (Premiere, Flame, DS), high end rendering (Renderman, 3Delight), CAD (Catia, Solidworks, NX), embedded systems (almost anything in cars, airplanes, appliances), and a million other areas are all still as closed as can be, and open source isn't even competing, much less innovating.
- nickpsecurity 11y agoThose are good examples. I'm not sure what the actual split is. Don't forget, though, where the real majority of innovation is: academic (mainly) and corporate labs. I went into detail a little while ago: https://news.ycombinator.com/item?id=10269245 https://news.ycombinator.com/item?id=10269245
- jlarocco 11y agoI think you're right for computer related stuff, like networking, databases, operating systems, etc. And it may even be technically true for the examples I mentioned. But in those areas, for all practical purposes, research from academic and corporate research doesn't actually get used until it's implemented in closed source software. At the annual Siggraph conference a good portion of the papers come from companies like Pixar and Autodesk, and get implemented in their products. Outside of that, it's pretty rare for the academic stuff to go much beyond a cool demo, unless one of the big graphics companies thinks they can use it, at which time they buy up the rights to it.
- nickpsecurity 11y agoThat's the exact problem I'm talking about. Yet, there's so much great stuff that they make! Stuff I'd love to be using right now in something else I have. Gotta figure out how to solve this problem. It's why I keep thinking of creating a new resource that's an alternative to IEEE/ACM w/out their expensive paywall, links to Wiki's on the subject, and good search functionality. Get enough in there on key topics and on sites like HN might get it going.
- jlarocco 11y agoI didn't mean to imply that the problem was an expensive paywall. Using graphics as an example again, imagine a research paper explaining a new rendering algorithm that can render in half the time of the next best algorithm. As great as it may be, it's not very useful without the rest of the software infrastructure that comes along with a production rendering system, like Renderman, 3Delight, or Maya. So even if the academic researchers release an implementation as open source, it's unlikely to be used in production until it's incorporated into one of the big closed source systems. I suppose pay walls could be a contributing factor, but in a lot of areas the open source solutions are so far behind the closed source systems that inaccessible bleeding edge research isn't biggest problem.
- nickpsecurity 11y ago
- teddyh 11y agoYou list things which proprietary software does way better than free software. I remember when the list was the other way around – i.e. people would list things that free software could now do, which were not very many at the time. It’s interesting that this relationship has now been reversed, and people, like yourself, now instead list the things which proprietary software can do better.
- nickpsecurity 11y agoThat's interesting if true. It's going in that direction, too. However, I think the list is still the same: most tasks have proprietary applications that do it better with OSS mostly trying to clone them and more rarely innovating past them. I mean, MS Office vs OpenOffice? VMS or NonStop clustering vs whatever's on Linux? Windows or Mac OS vs GNOME? Most OSS just sucks compared to best proprietary stuff. It still can't do better. So, proprietary tools are the ones that OSS is still judged by. Certain categories, esp in infrastructure, have OSS kicking serious butt. The dynamic works the opposite way. Even stronger are the hybrids of proprietary and OSS that make the argument less meaningful. Many of us have predicted that hybrids would smash both with some evidence of this in cloud sector. OSS still isn't in that dominant position in general, though.
- jlarocco 11y agoI don't think the situation has reversed at all, and in fact open source has grown tremendously. There's more open source and free software, of higher quality, than any other time in the past. Commodity software like operating systems and web browsers are now dominated by open source. My point is that despite the growth, there are still many, many areas where the open source offerings are pretty lame and noncompetitive (if they even exist). Open source has never been very competitive in any of the areas I mentioned.
- teddyh 11y agoI think you completely misread my comment.
- chaconnewu 11y agoMost of widely popular open-source software are to empower developers, which doesn't actually aim at creating end user experiences. Most end user software (games for e.g.) are neither free nor open-sourced. So I wouldn't agree that "Today it is almost taken for granted that the source code for most software is freely available."
- brc 11y agoI don't find it strange at all, and looking at a proper classical economist - they would have no trouble explaining it. Most people, when understanding economics tend to make the jump directly to money/cash when explaining prices and market action. But to be correct you have to look at utility. There's little question as to why companies install open source software - the TCO can be lower. But why do people contribute their time in building it? The answer is that the reward of being part of an OSS team brings great utility to a developer, and this is true even for marginally successful OSS projects. So people exchange their time for intangibles like reputation, credibility markers ( the author casually drops in which projects he is involved in) as well as the ability to leverage involvement into actual cash like well paid consultant gigs, books or successful blogs. So there isn't any strangeness going on at all. OSS makes sense from a company point of view, and it makes sense from an individual developer point of view.
- danharaj 11y agoCalling it utility doesn't seem to actually explain what it is.
- brc 11y agoUtility is a well-known concept in economics. It's strange at first to the outsider, but it's easy to understand with a little reading.
- danharaj 11y agoI know what utility is in economics, my problem is that you can always just say that the reason why people do X is because they are rational and X maximizes their utility. It doesn't tell you why that is their preference and why X satisfies their preference. It is not like the action or hamiltonian in physics which come with equations of motions that can be checked against experiment. Why is open source good for everyone? You didn't explain it, you just cast it in certain terms, which is useful for distilling the problem, but certainly not for solving it. You gave your guess why it improves the contributors' utility, but you haven't really proved it. It's just a guess. I can guess, too. My guess is that open source software reduces the transaction costs of acquiring and fixing software for corporations, but I could not explain to you with neoclassical economics why developers work on it without being compensated. It should be a tragedy of the commons, but it isn't. Open source software is developed at the fraction of the cost of closed source software and either competes or completely dominates it. I don't believe in Liberal organizations of economy though, so it's not a big deal for me.
- dfc 11y agoWow, I was expecting a little more economics in a post titled "the strange economics of OSS." It is too bad the post makes such grand claims without any modicum of effort to back them up with data; these are very interesting research questions. The two most hand wavy claims have to be "it is almost taken for granted that the source code for most software is freely available" and " it is at larger, older firms, that the least amount of open-source software is written." As far as the former goes you really have to ignore Apple's ecosystem, video games and anything related to industrial automation or espionage in order to make such a claim. As far as the latter claim goes IBM, Intel, Oracle, HP, Texas Instruments etc are often at the top of contributions to the Linux kernel by company. To be honest thee latter claim is rather empty without some methodological framework that defines "older company" and "most open source software."
- bduerst 11y agoRight? They could have at least gone into detail about how businesses now follow the model of open-sourcing the software and then making revenue on the implementation fees. Or they could have talked about how open sourcing is part of a race to the bottom. They mention some SQL-like databases, which is a tech that started out as proprietary. How much tech starts immediately as open source?
- nickpsecurity 11y agoOr selling out their users to advertisers for hefty profits while open-sourcing software they use to do it efficiently. ;)
- uxcn 11y agoOr even just Redhat and where the majority of their revenue comes from. I'm actually angry I clicked on this link.
- carterehsmith 11y agoYeah, the post comes across as a random rant about everything, and nothing in particular, just venting out. I guess the op was somewhat drunk or something... we all do that ;)
- Touche 11y agoIt's shifted towards consulting. You build great OS projects and people pay you to make it work for their company correctly.
- amirouche 11y agoTo the contrary. I think the perceived success of FLOSS is mainly due to the fact that there is more big companies with the incentive to make big softwares free. This is not what OP says. I don't say it's not progress. But if we end up doing all the same things the same way, the prize is not that bright.
- danso 11y agoIt's always tough to explain to non-developers that the fact that they can, on their own laptops, install roughly the same stack as a multi-million/billion startup in a relatively instantaneous amount of time. And with one line of HTML, include a design framework that came from the result of countless dev-hours to refine. The software is indeed valuable, but it's not tangible or immediately useful in the way that Formula One cars, if given away to everyone from an infinite supply, would make people drive incredibly fast even if not well enough to win a race. Another factor is that much of the best open-source software is similar to the best Unix tools: they do their one job very well. Being able to install all of them at your leisure is not much more advantageous than having grep, curl, and awk installed but no text files to work with or knowledge about how to use pipes. I was trying to think of closed-source, focused software that is most definitely better than their open-source rivals. Not counting full-featured suites such as MS Office/Google Drive versus LibreOffice, or GIMP vs Photoshop...the first thing I can think of is ABBYY FineReader for OCR, which I've never used but the results of which seem to blow Tesseract out of the water, even though Tesseract is very good. But perhaps its niche is not broad enough to attract the level of open-source development in the same way that software and database architecture has.
- vonnik 11y agoGreat piece. Our startup supports http://deeplearning4j.org http://deeplearning4j.org and http://nd4j.org http://nd4j.org, and it's a great feeling having the open-source wind at your back. Talented strangers helping to fix and grow your project. To use a couple economists' terms, positive externalities are generated when code is open-sourced, and the beneficiaries are the companies contributing, because together they're making something greater than any one firm could build alone. Our software is orders of magnitude better simply for having been opened to hundreds of pairs of eyes. The QA is intense. Engineers at closed-source deep-learning startups chafe under their gag orders, especially since so much of what's closed quickly becomes outdated. Lack of transparency can easily hide lack of competence.
- erikpukinskis 11y agoI think it's important to note the strange duality of this moment: 1. This is a cambrian explosion of open-source infrastructure tools 2. This is the dark ages of open-source UI I think it's important to be aware that on this front the Open Source movement has completely stalled. When I was in College, I used Abiword, Evolution, and Rhythmbox. Now those things have been replaced for me with Google Docs, Gmail, and Amazon Music. I love the web, it's incomparable for convenience, data protection, and access on multiple devices. But it is fundamentally at odds with Open Source software. Back in the day of desktop software, you could throw a tarball on the web and people could use your stuff without any real handholding. In order for people to use a web service you write, you have to maintain a server instance. It's just not worth it for me, random open source web service author, to maintain a server for millions of you, random open source software users. It's time and it's money for very little direct benefit to me. And on app stores, it's pretty bad too. Maintaining a reviewed and updated app in an app store is a huge job, and not something a casual contributor to an open source GUI is going to want to do, just to have access to their branch of an app. And I'm not even sure Apple will let you submit an identical app with just one little feature changed. This will change... the endgame is something like Ethereum, and the currentgame is maybe something like Heroku Button, but there is still a lot of infrastructure to build to make it as easy to maintain an open source web app as it is to maintain a desktop app. And in the meantime, Open Source UI is just going to languish a bit. That's OK, it's just where we are in the history of the web. But it's going to get a lot better in the not too distant future.
- skybrian 11y agoSandstorm seems like another good possibility.
- bad_user 11y agoMy desktop is Linux and I still use LibreOffice, VLC and Thunderbird. And I also used Google's Docs, Calendar, Gmail and Music, but I've cut off my Gmail / Calendar usage due to their poor implementation for standards, having migrated from Google Apps to FastMail. I'm also paying for a Dropbox subscription because they are the only major cloud storage provider with native support for Linux and even though some clients exist for Google Drive I can't use a solution that doesn't want me as a customer; but enough ranting. I don't agree with you because the browser is ubiquitous and the web is open and based on standards. And you don't actually need a server to do interesting things in the browser. Quite the contrary, because of modern browsers, a majority of people with a PC have access to a potent development environment. And then the difference between the web and app stores is like night and day.
- elektromekatron 11y agoI know that this will annoy some people, and believe me, I mean this with a very small 'c', however I think that the open source movement is far and away the most successful communist experiment in history.
- crdoconnor 11y agoOr a natural reaction to an overshoot of capitalist excess (trying to create scarcity out of a thing that fundamentally isn't scarce in order to profit).
- tdylan 11y agoHow so?
- amatic 11y agoIP communism is not in conflict with belief in private property rights. The trick is in denying IP the status of property, because you cannot own ideas in the same sense you can own a car. Cars are fundamentaly scarce, two people can't use the same car at the same time. Ideas can be copied and improved upon, they don't go away when somebody steals them. Anyway, there would certainly be successfull business models in absence of software patents. Not saying 'we should abolish software patents', we are probably too invested in this model.
- sanxiyn 11y agoMeans of production, right? I agree the resemblance is more than skin deep.
- hodgesrm 11y agoIt's a bit hard to argue that infrastructure software is dominated by open source. The stack behind Amazon Web Services is almost 100% closed. It's not just closed source--Amazon rarely even comments about how services like S3, EBS, and Redshift work except when they fail. All of the DBMS they have developed are closed source as well. Closed source database innovation is alive and well.
- nickpsecurity 11y agoMost innovation in databases is either proprietary companies or small teams of academics. Of the proprietary companies, some choose to open source their work. Yet, it's still done in a proprietary style of one, paid team building it. Add in the fact that many OSS projects have paid or sponsored developers. All together, leads me to wonder whether most OSS should be considered proprietary development or how much community-driven efforts actually accomplish.
- ekianjo 11y ago> I always use the names of economists for my machines’ hostnames. keynes, friedman, marx, fisher, ricardo. Where is Mises and Hayek ?
- danharaj 11y agoIn the garbage bin.
- vezzy-fnord 11y agoHayek, the second most cited economist?
- ekianjo 11y agoKeynes should rather be there, with his stupid Stimulus theory that has been proven to be detrimental over and over again, on every single occasion.
- crimsonalucard 11y agoThere is one thing about open source that needs to be known. It is not self sustainable. It requires external factors for support. Allow me to elucidate. The software engineer occupation is a highly specialized role. A software engineer alone does not have the ability to survive, hunt food, or build shelter. Instead the software engineer must trade his skill for the services of other experts. In short, a software engineer who only gives away his work to the open source community basically can't pay the bills. He needs to sell his work. Although open source is built off of the leisure time of programmers that leisure time must be bought and paid for by an external factor. More often than not, that external factor is Closed source. Ironically, open source only exists because of closed sourced apps or web services.
- openfuture 11y agoThen the system needs to reflect that. If it weren't for open source it would be impossible to compete with established proprietary software companies. 'Proprietary licenses' should expire and become open just like copyright is supposed to.
- davidw 11y agoOnly exists because of scarcity: http://journal.dedasys.com/2007/02/03/in-thrall-to-scarcity/ http://journal.dedasys.com/2007/02/03/in-thrall-to-scarcity/
- logn 11y agoI think the trend is that closed source software is increasingly becoming the highly customized last-mile code that runs a specific business which sells services, curated information, or physical products. I also think this is why jobs involving OSS development are increasingly attractive to candidates. Do you want to spend your time building what amounts to a one-off solution to duck tape some wonky IT-department components, or do you want to work on well-engineered projects that are generalized solutions? So I think closed source software is basically the last layer that integrates open source software. Which ever side you view as bringing in the sales and money is really just a matter of perspective.
- EGreg 11y agoThis explains it: http://m.youtube.com/watch?v=u6XAPnuFjJc http://m.youtube.com/watch?v=u6XAPnuFjJc Open source is a gift economy, like science without patents!