Open Source Business: When Mohamed lives on Mountain

451 CAOS Group report “Open Source is not a business model” has been criticized in the blogosphere, saying that it overlooks vendors for which pure open source is providing a tidy revenue stream.

Dave Neary sees an (open source) future for small businesses, with few (happy) customers, explaining that since free software doesn’t get developed like proprietary software, the free software industry shouldn’t look like the proprietary one.

I totally agree with Dave’s last point, free software is a different thing, as formerly pointed out in
Capability Coordination in Modular Organization: Voluntary FS/OSS Production and the Case of Debian GNU/Linux“.

Discovering knowledge differences or similarities and making use of them in order to pursue one’s ends is however not costless. Knowledge search is expensive. Because knowledge is dispersed, the organizational problem does not usually have a cheap and easy solution. Ideally – think of the market – the “first-best solution” to the problem would result in the coincidence (or collocation) of productive knowledge and rights to act on that knowledge in the same hands. As in the case of Mohamed and the mountain whereby Mohamed could go to the mountain or the mountain to Mohamed, there are two ways we could achieve a solution to this problem.

Now, what happens is that with free software actually Mohamed lives on mountain.  Think of Tobias Oetiker, RRDTool and MRTG author, and think of how many brilliant hackers make a living in the open source long tail. Life style companies, great programmers, but is it really their destiny to stay small?

The open source long tail is too long to be tucked inside trousers or a skirt, that’s why SpikeSource, SourceLabs or OpenLogic try to (partially) solve it.Those companies are appropriating returns from the commons in original ways, taking advantage of the (frequent) absence of corporate actors within many open source projects in the long tail.

The business side of open source is still a largely unexplored planet, and there is no evidence of the fact that small businesses have to stay so. Not yet, at least.

Technorati Tags:   commercial open source, open source business, 451 group

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