It makes sense if you consider that the hardest point of any economic transaction is convincing people that you have something of value to them, and the best wa

It makes sense if you consider that the hardest point of any economic transaction is convincing people that you have something of value to them, and the best way to increase the amount of money you take home (particularly when selling a scarce good like your labor) is to get more people interested in what you're selling and take the best offer. Most open-source developers are motivated by exposure. The independent ones can often parlay their open-source contributions into a better job or higher salary; "I wrote Pandas" looks great on a resume. The corporate ones are usually doing it either for recruiting (by demonstrating that they support open-source software, and being able to attract & vet potential developers by their open-source contributions), or for publicity, or to commoditize their complements and increase the demand for their product. Once the software is out there, it's free for everyone to use, so if it's useful, it gets used. Hard to compete with free. A lot of other strange things about the software industry come from this realization that sales is the primary problem faced by every service business, and software is an effective way of making more sales. Google, Facebook, and Twitter's primary business model is in getting your service in front of people and increasing your sales; that is how they make hundreds of billions. The reason for the "price desert" between consumer software that costs ~$100/year and enterprise software that costs ~$100K/year is because the latter is sold through consultative sales that requires paying a professional salesperson. The reason why enterprise software companies will often offer a free version of their product (eg. Github, Dropbox, AWS, Heroku, YCombinator) is because it's free lead generation for the paid product, and usually offering the free version costs less for higher quality leads than traffic acquisition through paid sources like Google. The reason why VCs will bid up the shares of any business that has actual people using their product, regardless of how trivial it seems, is that they've solved the hardest part of building a business and can usually find new ways to increase the importance of their product and charge more for it afterwards.