Open Source Business Models

Open Source Business Models
Open Source Business Models

In this article we will talk about Open Source Business Models, and in previous article we already discussed about Intent-Based Networking.

If all this software is free, how can anyone make money off of it? First, you must understand there isn’t anything in the GPL that prohibits selling software. In fact, the right to sell software is part of the GPL license. Again, recall that the word free refers to freedom, not price. Companies that add value to these free programs are encouraged to make as much money as they can, and put those profits back into developing more and better software.

Business Models

One of the simplest ways to make money is to sell support or warranty around the software. Companies like Canonical, the developer of Ubuntu, and Redhat have grown into huge enterprises by creating Linux distributions and tools that enable commercial users to manage their enterprises and offer products and services to their customers.

Many other open source projects have also expanded into substantial businesses. In the 1990s, Gerald Combs was working at an Internet service provider and started writing his own network analysis tool because similar tools at the time were costly. Over 600 people have now contributed to the project, called Wireshark. It is now often considered better than commercial offerings and led to a company being formed to sell products and support. Like many others, this company was purchased by a larger enterprise that supports its continued development.

Companies like Tivo have packaged hardware or add extra closed source software to sell alongside the free software. Appliances and embedded systems that use Linux are a multi-billion dollar business and encompass everything from home DVRs to security cameras and wearable fitness devices. Many consumer firewalls and entertainment devices follow this model.

Today, both large and small employers have individuals and sometimes whole groups devoted to working on open source projects. Technology companies compete for the opportunity to influence projects that will shape the future of their industries. Other companies dedicate resources towards projects they need for internal use. As more business is done on cloud resources, the opportunity for open source programmers continues to expand.

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