Friday, August 4

Open Source & Open Innovation

Traditionally open source has been seen as an community based software development model which was an alternative to more structured development methodologies. Today "open source" from its origins in utopian ideas of free & open software movements, has morphed into a deadly weapon that is tactically used for larger strategic objectives. Significant number of programmers, who are part of the open source movement are paid to do so and not necessarily doing so as hobbists, amatuers or for other altrustic purposes. Large corporations have usurped the open source movement to commodotize competition and/or increase adoption of complementary offerings by offering it free.

[Complements: Bread & butter are complements, so if price of bread goes down (becomes zero/free) and demand for butter goes up]

Clearly few independant developers would want to be willing participants to such shenanigans given that increasingly objectives of more successful projects are for a for-profit organization for private returns. So the point I am getting to is this: Open source is becoming less & less of an altruistic alternative development model and increasingly become the mainstream ADOPTION model for profit-oriented corporations. And there is nothing wrong with that.

What software companies in the open source space aim to achieve and more likely to get are groups of early adopters and dedicated users, who can act as highly informed and credible validators, some of whom could contribute code. More simply companies will aim to create a market for an innovation that was not their earlier.

My argument is that open source will evolve as a robust business strategy where software and services are complements. With the growth of services, software will increasingly become "freer" and companies will resort to open source. R&D invesments of services companies result in IP assets that are complementary to services and rapid diffusion of IP assets using open source will generate demand and reputation for associated consulting and application development and support services. The primay goal is to increase the number of potential customers/market for the innovation then use their superior strengths in service delivery to monetize the innovation. Beyond monetization & business models open source is a compelling model to benefit from innovation that happens outside the firm also referred to as the "open innovation" paradigm.

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