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Free Can Mean Big Money - The Open Source Economy

simoniker posted about 10 years ago | from the red-or-dead dept.

Linux Business 494

Gentu writes "People are always accusing Open Source proponents of being communists, but an editorial by the OSNews publisher, ex-Red Hat employee David Adams, takes a critical look at whether Free and Open Source Software is really anti-capitalistic or is, in fact, only a product of the free market at work. Does wide availability of high quality, low cost software harm or help the world's economy?"

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Free means big money for someone else (1)

Bring back the old t (784356) | about 10 years ago | (#9984914)

Congratulations

Free can mean Babes too - if you use BSD! (-1, Offtopic)

Anonymous Coward | about 10 years ago | (#9984918)

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$Id: ceren.html,v 9.0 2004/08/08 16:01:34 ceren_rocks Exp $

And this is bad why...? (4, Insightful)

epod (726223) | about 10 years ago | (#9984927)

That whole thing assumes communism is in any way bad... It's biased to begin with.

Re:And this is bad why...? (2, Funny)

ViolentGreen (704134) | about 10 years ago | (#9984978)

That whole thing assumes communism is in any way bad... It's biased to begin with.

Quite commie!

Re:And this is bad why...? (1)

baudilus (665036) | about 10 years ago | (#9985121)

Actually, communism is not bad during times of 'depression'. The problem is when the depression is over...

There are no pure capitalist nations. (5, Insightful)

SatanicPuppy (611928) | about 10 years ago | (#9985230)

Ever hear of Social Security? Medicare? Welfare? Public education, non-toll highways, government funded research?

Yea sure, some people think these things are bad, but they're scary in the other direction.

Marx would have liked it, because it's a dialectic, eh? On one side, Capitalism--heartless and evil. On the other Communisim--mushy and incentive-free. Combine them? Excellent system.

It goes the same way with open source. We give it away, and we reap the rewards. Sure, its not the same kind of money you'd make if you were out to fuck everyone, but it's steady and solid, and the repeat business is kickin.

Thanks (-1, Offtopic)

Gothmolly (148874) | about 10 years ago | (#9985052)

For clearly identifying yourself. Another Foe, it must be a good day.

Re:Thanks (0)

Anonymous Coward | about 10 years ago | (#9985202)

same to you.

Re:And this is bad why...? (1, Troll)

Jollyeugene (230857) | about 10 years ago | (#9985075)

Gee, I don't know: It is that whole guy with an AK pointed to my head telling me that I really like the government deciding that it owns everything and what I can and cannot do facist sort of aspect thing that I think just might be bad.

Perhaps you meant socialism or democratic socialism?

Re:And this is bad why...? (5, Funny)

daem0n1x (748565) | about 10 years ago | (#9985132)

Yeah, sure, capitalists don't point AKs to anybody's head.
They use UZIs.

Re:And this is bad why...? (1)

Nos. (179609) | about 10 years ago | (#9985145)

Democracy can happen under communism, socialism, or capitalsim.

Re:And this is bad why...? (2, Insightful)

Mateito (746185) | about 10 years ago | (#9985211)

Um.. communist and fascist are as about as far apart as you can get using a linear political spectrum.

Not defending either, but all you did was reinforce the original posters point. "Communism is bad" even though you don't even know what it is.

Re:And this is bad why...? (1)

AviLazar (741826) | about 10 years ago | (#9985086)

This is also the first time I have ever heard anyone refer to open source as communisim.
Just because something is shared does not make it communisitic (i.e. free public libarary, our road systems, a kibbutz, public water fountain, etc, the Internet).
A very liberal use of the word communism to say the least.
There are pro's and con's to everything - luckily in this country - we have a choice ---- hmm kind of different from communism

Re:And this is bad why...? (2, Interesting)

turnstyle (588788) | about 10 years ago | (#9985101)

People think Communism is bad because it didn't work.

Some may argue that the USSR, etc., wasn't "real Communism" but then the question remains: why wasn't it? Do traits of human nature (especially of those inclined to seek power) make such ideals unachievable.

In any case, I think an economic argument in support of free software would carry more weight coming from someone other than "OSNews publisher, ex-Red Hat employee David Adams."

Re:And this is bad why...? (5, Insightful)

waterwheel (599833) | about 10 years ago | (#9985112)

Open source software is the culmination of capitalism. When you've got your choice of various answers, and (generally) cost is not an issue, then only the strong survive. That kind of Darwinian process isn't communism at all. Plus, open source software (and particularly as it relates to the web) IMO makes all sorts of capitalistic ventures possible. On the web you're as big as MS or Wallymart - and you can get started in your basement on a shoestring using opensource software. What would apache cost if you actually had to pay what i'ts worth? Instead you can get a $10 hosting account ('cause the webhost didn't spend any money on software), throw up an OSS shopping cart or templated website and voila - you're online and making money. If OSS software wasn't as good as it is and free as in beer, there'd be a lot fewer starter/seed companies than there are. How many people are running their own business now that they couldn't have done 10 years ago? How many of those are running OSS software? How many would have had problems if they would have had to start off with $10K in software costs? Lots - that's how many. Mine included. I'm a capitalist, and love OSS because of all this. Help keep the competition fierce!

Re:And this is bad why...? (4, Insightful)

The Mgt (221650) | about 10 years ago | (#9985210)

Free market economics and capitalism are not synonymous. Capitalism, basically, is feudalism with money instead of land, usury instead of feudal service. You could dump capitalism and the market would still exist.

Re:And this is bad why...? (0)

Anonymous Coward | about 10 years ago | (#9985116)

"People are always accusing Open Source proponents of being communists"

And people are always accusing Slashdot editors of never taking Journalism 101.

Re:And this is bad why...? (0, Offtopic)

The Mgt (221650) | about 10 years ago | (#9985143)

I've always taken being called a commie as a compliment.

Re:And this is bad why...? (1)

rvw (755107) | about 10 years ago | (#9985177)

That whole thing assumes communism is in any way bad... It's biased to begin with.


To be honest, when I think of Microsoft, that feels to me more and more communist-like than OSS does. OSS makes me feel free, MS cannot give me this feeling anymore. And isn't freedom the basis of our society?


I hope you are being satirical (0)

Anonymous Coward | about 10 years ago | (#9985242)

That whole thing assumes communism is in any way bad... It's biased to begin with.

So what you're saying is, it would be unfair to condemn the whole program because of a few few [wikipedia.org] minor [wikipedia.org] slip-ups? [wikipedia.org]

good for world economy (3, Insightful)

Anonymous Coward | about 10 years ago | (#9984932)

it may be good for world economy but may not be good for US corporations which control US govt. US govt, in turn uses its sole superpower status to control other states and so on. Effectively, "if it ain't good for US Corp., it isn't good".

Re:good for world economy (2, Insightful)

BJZQ8 (644168) | about 10 years ago | (#9984953)

Exactly...this kind of thinking keeps those currently in economic power where they are...open source is about empowering a completely different set of people. If Open Source becomes the dominant form of software, certainly the total money pile for software will still be there...it will just be distributed much, much differently than now (i.e. Microsoft has 99.9 percent of it.)

Re:good for world economy (0)

Anonymous Coward | about 10 years ago | (#9985011)

Open source is good for US companies too (except software publishers).

The "Microsoft tax" is exactly that - a large tax on all business that _use_ computers.

Re:good for world economy (0)

Anonymous Coward | about 10 years ago | (#9985035)

there is no such thing as a US company that controls the US Govt.

they have long been global corporations.

toyotas are more american than any other vehicle on the road.

other way around? (-1, Troll)

obli (650741) | about 10 years ago | (#9984935)

I thought free software meant not spending any money on software, not getting money from it...

Re:other way around? (2, Informative)

Feneric (765069) | about 10 years ago | (#9984980)

There are different types of "free". There's "free" as in "free speech" and "free" as in "free beer". Some free projects adhere to one or the other, not all to both.

You can read about the GNU Free Software philosophy [gnu.org] for more information on the former.

Please. (5, Interesting)

SatanicPuppy (611928) | about 10 years ago | (#9985115)

I make all my money with free software these days.

I design a database...What do I use? Hmm Oracle? Can't afford it. MS SQL? Can't afford it. Guess it's MySQL or PostgreSQL, with the added benefit that I can charge a couple grand over the liscensing fees for either of those and make nice profit.

Deploy a firewall file server for some business? Win2003? Yea right. Solaris? Too expensive. Linux? I can charge ten grand and beat all my competitors.

Webserver? Apache. Office? Open Office.

MS Zealots can talk TCO all they want, but these people pay me a few hundred dollars a month to keep an eye on their stuff, and it never really breaks. I can admin three dozen boxes by myself, and I'm laughing all the way to the bank.

Re:other way around? (4, Insightful)

foidulus (743482) | about 10 years ago | (#9985149)

Well, IBM can "make" money from Linux while contributing back to Linux at the same time. IBM needs to meet it's customer's needs, and if Linux doesn't satisfy those customer's needs, then IBM can modify Linux to suit those customer's needs. However, the customer isn't paying for Linux, they are paying for the custom services/software on top of it.
Linux allows IBM to quickly build a solution for that customer without having to "re-invent the wheel" or pay software license fees. Thus IBM can get the job done for less, they can pass some of those savings on to the cutomer, and the Linux community can benefit from their additions. So, in essence they made money....

Poster is seeding the question.... (4, Insightful)

gosand (234100) | about 10 years ago | (#9984938)

The poster says: Does wide availability of high quality, low cost software harm or help the world's economy?

This of course assumes that OSS = high quality. That is definitely NOT always the case. OSS is just software, and can be good or bad quality. That being said, talk amongst yourselves...

Re:Poster is seeding the question.... (4, Insightful)

adamshelley (441935) | about 10 years ago | (#9984994)

>Does wide availability of high quality, low cost
>software harm or help the world's economy?

Where does he imply all OSS software is high quality?

>This of course assumes that OSS = high quality

No it doesn't. It assumes that there is high quality open source software that is widely available.

I won't bother to list the software. I just wanted to note that u're assumptions are wrong.

Re:Poster is seeding the question.... (2, Insightful)

Karzz1 (306015) | about 10 years ago | (#9985004)

Absolutely, however be careful not to infer that proprietary software = high quality. I think we all know that is not always the case either.

Re:Poster is seeding the question.... (-1, Redundant)

Anonymous Coward | about 10 years ago | (#9985012)

99.9999% of OSS is incredibly poor, under developed and under designed software.

huh? (2, Insightful)

Anonymous Coward | about 10 years ago | (#9984939)

Does it even matter if it hurts the economy? That's what capitalism is all about. Screw the other guys; if the consumer wants my cheaper product over theirs, then I win.

Re:huh? (2, Insightful)

KarmaMB84 (743001) | about 10 years ago | (#9984970)

I doubt capitalism is all about destroying the market so nobody, as in not even you, can compete anymore.

Re:huh? (0)

Anonymous Coward | about 10 years ago | (#9985018)

Yeah, I guess you're right... But if I take over the market with my cheaper, better product, I can still profit from my monopoly by selling services for the product, like someone stated earlier, so it isn't a completely bad situation.

Re:huh? (0)

Anonymous Coward | about 10 years ago | (#9985156)

Boo hoo! I'm shedding crocodile tears for all software vendors who rely on code such as the following to augment their revenue stream:

If (n > MAX_NUMBER_OF_WHATEVERS) Then ThrowFatalError "Pay us more money you dolt!"

or

If (Not Licensed) Then ThrowFatalError "Not licensed to use addition and subtraction library! What are you trying to, cheat us?"

I'm also crying for companies who sell software meant to be used to develop software. They can go fuck themselves with their documentation that's designed to impress the higher ups but is practically useless for the developers. There's no better documentation than that written by developers for developers. Barring written documentation, source code is the next best thing.

In summary, the software-as-a-product mentality will die a painful death. I, as a software developer, will be happy.

Re:huh? (1)

dmh20002 (637819) | about 10 years ago | (#9985236)

I think in Economics class I learned that in a perfect market a commodity product will yield zero profit. The better and freer the market is, the less profit. Its the government protected, regulated markets that screw the consumer.

OSS is all about capitalism, as long as you don't cross the line that says you HAVE to give your software away, GPL or otherwise.

Re:huh? (2, Interesting)

geomon (78680) | about 10 years ago | (#9985002)

I agree.

Those bright lights you see illuminating the night sky over Las Vegas are powered by the spinning of Adam Smith's body in his grave at the mere suggestion that we protect a market from competition.

The anti-capitalists are those who have never read Smith's tirades against corporate interests who use the government to protect their markets.

More [slashdot.org] stuff Slashdot didn't publish.

Re:huh? (4, Insightful)

johnnyb (4816) | about 10 years ago | (#9985250)

Actually, there is a difference between money capitalism and free market capitalism. Adam Smith was a free market capitalist. Money capitalism is actually pretty much the same as communism but administered in a different fashion.

Unfortunately, in the US, we are moving more and more towards money capitalism.

BusinessWeek on GPL (4, Informative)

prostoalex (308614) | about 10 years ago | (#9984942)

There's a BusinessWeek article today [businessweek.com] advising the Linux community and those in product development to drop GPL and release under BSDesque licenses in order to stay more business-friendly.

Re:BusinessWeek on GPL (5, Informative)

FunWithHeadlines (644929) | about 10 years ago | (#9984976)

There's a BusinessWeek article today advising the Linux community and those in product development to drop GPL and release under BSDesque licenses in order to stay more business-friendly.

...and a Groklaw article [groklaw.net] demonstrating why the BusinessWeek author should have done more research first.

Re:BusinessWeek on GPL (1)

slashjames (789070) | about 10 years ago | (#9985055)

Of course they would recommend a BDSesque license. It legally allows another company to sell the compiled application without disclosing any source (that's the "business-friendly" part). The strength of the open source community is that changes get pushed back to the original source, and then can be merged with the main code branch instead of everyone having to maintain lists of patches to apply.

Therein lies the dilema: Develop applications in closed source, keeping the code details a secret, and sell them for a profit vs. develop open source applications, where the software is basically free, and make money from selling services related to the open source software.

I'm not advocating either choice, just saying that what the choices boil down to.

Re:BusinessWeek on GPL (4, Insightful)

Zangief (461457) | about 10 years ago | (#9985061)

The 'B' in the 'BSD license' means Berkeley. It refers to an University. This University business is not to produce software, but to educate, research, etc.

This means that they do not care what happens with the software produced by them. They wish that people use it, and put almost no barriers to this purpose. This means, in the business context, that modifications done tho the software ARE NOT GIVEN BACK to the comunnity, whatsoever. This makes sense to greedy business house (Microsoft backs FreeBSD's license as "True free software")

GPL makes sense to the programmer, whose business IS producing software, because if you modify a GPLd software, you have no obligation to give it back. But if you modify it AND distribute it (ie, you sell it), you must give it back to the world, under the GPL.

To the programmer, BSD makes no sense. It may make sense to the Universities. Stick with GPL and LGPL

Re:BusinessWeek on GPL (1)

ClosedSource (238333) | about 10 years ago | (#9985245)

"GPL makes sense to the programmer, whose business IS producing software, because if you modify a GPLd software, you have no obligation to give it back. But if you modify it AND distribute it (ie, you sell it), you must give it back to the world, under the GPL."

So it appears you're saying that if your business is producing software but you aren't going to sell it, you don't have to give anything back. So what kind of software business doesn't sell software?

"To the programmer, BSD makes no sense."

To this programmer, your statement makes no sense. If I want to keep my source closed, I keep it to myself. If I want to make my source avaliable, I don't give a rat's ass what people do with it. If I incorporate somebody else's code in mine, why would I want to choose GPL'd code with all the restrictions that go with it?

Re:BusinessWeek on GPL (1)

node 3 (115640) | about 10 years ago | (#9985081)

Screw business-friendly. I'd rather be people-friendly.

I'm a person, not a business, so that's part self-interest.

Most people are people first, businesses second, so it's part humanitarian.

I suppose, however, something called "Business Week" is going to prefer the businesses. Screw 'em both when their interests conflict with human interests.

Re:BusinessWeek on GPL (1)

johnnyb (4816) | about 10 years ago | (#9985148)

if(business == SOLE_PROPRIETORSHIP)
{
a = difference(business, person)
print a; // should print 0
}

Re:BusinessWeek on GPL (1)

Mateito (746185) | about 10 years ago | (#9985244)

You, as a business, can have limited liability.

You, as a person, cannot.

Re:BusinessWeek on GPL (0)

Anonymous Coward | about 10 years ago | (#9985082)

Yeah, and it's quite an absurd article. IMHO a major reason why Linux is much industry support (IBM, HPQ, RHAT, NOVL, etc), compared to BSD (BSDi, who else) has so little is the GPL.

Commercial companies who use BSD licensed stuff (Apple) tend not to give as much back to the community as the RedHats of the world, but rather see software features as their competitive advantage.

(And no, it's not the ancient BSD/ATT licensing issues that stopped BSD from getting RedHat Suse or IBM support since those events happened long after those issues were resolved)

It's important to remember... (4, Insightful)

danielrm26 (567852) | about 10 years ago | (#9984946)

...that you can still sell services based around that free software.

Confusing Software (2, Funny)

Anonymous Coward | about 10 years ago | (#9985021)

You could make confusing software and then charge people to help them understand it...

Re:It's important to remember... (1)

js3 (319268) | about 10 years ago | (#9985165)

some people didn't study to code to answer the phone

Re:It's important to remember... (4, Interesting)

Kenja (541830) | about 10 years ago | (#9985195)

"... you can still sell services based around that free software."

And so can anyone else. While you, the devloper, have to recoup your devlopment costs. Another group (say Redhat to name a company at random) can undercut the cost of your services with their own since they have zero dollars to recover. Thus the developer gets put out of buinsess and all we have are people working for free and large companies selling services. Not a utopia of software engineering in my opinion.

Re:It's important to remember... (0)

Anonymous Coward | about 10 years ago | (#9985228)

I am fed up telling people what the word 'free' means in the context of 'free software'.

Free refers to liberty, lack of restraint, freedom etc. and does not necessarily mean without cost.

Money for the companies... (3, Insightful)

cytoman (792326) | about 10 years ago | (#9984955)

... how much of the money companies make trickles down to the volunteer coders of OSS?

Re:Money for the companies... (0)

Anonymous Coward | about 10 years ago | (#9985058)

Moderators... parent is not flamebait... the question looks legit to me.

Re:Money for the companies... (1)

stratjakt (596332) | about 10 years ago | (#9985154)

I want to know that too. I know corporations bankroll a lot of OSS stuff, especially big ticket projects like Samba or ReiserFS, etc..

How much does Andrew make to work on Samba full time? How much, on average, do "paid" OSS coders make?

Ie; Is contributing to OSS a good "career move"? Is there any incentive to do so beyond a warm fuzzy I-helped feeling, or bragging rights?

Say I thought up a really slick distributed filesystem. Should I dual license like mysql? Release it under the GPL and shmooze for some financial backing? Sell it outright to the highest bidder?

Let me guess (1)

BillsPetMonkey (654200) | about 10 years ago | (#9984966)

For those of us who won't RFA, the synopsis might be:

"OSS is good for the economy because it raises the opportunity cost of using free software over paid for software. Never again will you have to pay for an Outlook-type program for Windows over it's free version. As a consequence the quality of output from the software industry is raised, thus promoting competition over monopolistic practices"

Was I right? Should I read it now?

Re:Let me guess (0)

Anonymous Coward | about 10 years ago | (#9985103)

Yes

The money you can save (3, Insightful)

p0 (740290) | about 10 years ago | (#9984969)

Think about all the money educational institutes, medical centres and so forth are saving by moving towards open source. They are able to invest these funds in various other departments such as research, human resources and so forth.

Re:The money you can save (1)

erroneus (253617) | about 10 years ago | (#9985060)

This assumes the greedy pigs aren't just applying the money saved to their own yearly bonuses?

Capitalist Pigs (1)

Saeed al-Sahaf (665390) | about 10 years ago | (#9984983)

Open Source defiantly means free money to some of the "Capitalist Pigs" that fold parts of it into proprietary commercial packages or bundle apps with proprietary commercial packages. There are without question commercial companies abusing the GPL / BSD licenses. Of course, while one might suspect, it can be difficult to prove.

Entry into markets (3, Insightful)

ImTwoSlick (723185) | about 10 years ago | (#9984991)

OSS can help small businesses get the foot in the door when trying to enter into a competative market. When every penny counts, OSS is a big way to save money needed for startup costs.

For those who just don't get it (5, Insightful)

Amiga Lover (708890) | about 10 years ago | (#9984996)

Linux is not Just One Big Thing.

Just because you go into a linux service business does not mean you have to support ALL linux systems and run into spirals of madness therein.

Make your own. Make it specifically yours. Make it free to the world if you like, but also make it so you only do paid support for the system from people who have your exact defined distro.

You're in a service business, not a software business then. It doesn't matter if people copy your software, or improve on it, or spread it worldwide. You still provide services to your customers. They still pay you to maintain.

That';s the bit most of the big boys don't get. "The software is free! Free for anyone else to use! Free for all! Free and they can copy it!". True. But you the service company knows that your services are not free. Your time is not free, and you spend your time keeping your customers running smoothly and you earn from that.

What's better about a Linux service economy than a Win one - a service business based on proprietary software may come up against roadblocks. limitations in the software that their proprietary vendor does not address. Limitations that may make your clients go elsewhere, "switch" as it were.

With linux, you can implement that change. You can make the product you give away perform as they need, and keep supplying service from then on.

Linux - It's a service economy now guys. The only money to be made is in serving free software and in being the service provider known to be the best for a situation. Implement functions your clients need first, get paid first. TRUE market driven innovation.

(thank you this marketing rant was brought to you by 3 straight days awake and sixty coffees)

Re:For those who just don't get it (1)

British (51765) | about 10 years ago | (#9985039)

You just gave me an idea.

1. make linux distro+sw package so complicated only your team of tech support reps know how to get it to work.
2. charge a lot for support
3. profit!

Re:For those who just don't get it (1)

Amiga Lover (708890) | about 10 years ago | (#9985126)

1. make linux distro+sw package so complicated only your team of tech support reps know how to get it to work.
2. charge a lot for support
3. profit!


You might have said that in jest, but there's some truth behind it. If you implement a new facility in your distro, let's call it Britix - then you know it, you train your techs to know it, and your company knows it inside out. Then you release it to the world and immediately you're the only people who know how to best use it, and what purposes its best suited for.

For a short time, your company are the experts on that facility. You pick up work from that, and before the next guys are up to speed, innovate a bit more, add new facilities in.

This, I see, would lead to specialisation in distros for certain markets. None of this WindowsXP for business, desktops, servers, medical, space, manufacturing, but instead specialist linux distros tailored for just the industry you service.

Re:For those who just don't get it (1)

johnnyb (4816) | about 10 years ago | (#9985169)

And watch your customer base go to 0.

Also, remember, that if other techs have difficulty supporting your app, your new recruits will have similar problems.

Re:For those who just don't get it (1)

garcia (6573) | about 10 years ago | (#9985040)

That';s the bit most of the big boys don't get. "The software is free! Free for anyone else to use! Free for all! Free and they can copy it!". True. But you the service company knows that your services are not free. Your time is not free, and you spend your time keeping your customers running smoothly and you earn from that.

The "Big Boys" are used to making their cake, selling it, and then feeding it to the customers too.

They make profit on the sale of the software and then the expensive service contracts to go w/it. This eliminates one side of their profit stream.

Re:For those who just don't get it (2, Interesting)

stratjakt (596332) | about 10 years ago | (#9985192)

Thats fine, but who's going to write the software? The personnel of the umpteen million "linux consultantcy" firms that will appear? Do the coders get compensated at all under this model, or do they perpetually beg for handouts?

I don't see how OSS can push the bleeding edge of software without some real financial motive for the developers.

Oh, sure, my awesome new internet app will be the killer app of tomorrow, and all kinds of consultants will get richer than Jesus supporting it.. But what about me, the poor chump who wrote it?

Know who's making money on OSS? IBM, SCO, Sun, Apple.. Watch MS reinvent itself somewhat as a service provider, and they'll rake in some of those bucks too.

On high quality, low cost software... (1, Funny)

heyitsme (472683) | about 10 years ago | (#9985009)

Does wide availability of high quality, low cost software harm or help the world's economy?

High quality? Have you looked on Freshmeat lately?

Re:On high quality, low cost software... (0)

Anonymous Coward | about 10 years ago | (#9985140)

exactly.. let us have a bug party.. we will install ever application on freshmeat and post all the bugs that we find.. the experts can review and find exploits..

MmMmMmMm just think of all the source code that is available on there that we could review and find exploits.. MmMmMm root..

Think ! (3, Interesting)

foobsr (693224) | about 10 years ago | (#9985023)

I think this once was a buzzword used in IBM advertising.

International Business ....

I have recently heard they are strongly connected to OSS. Somehow, they still do what they once advertised.

So at least, one can infer that OSS is good for IBM.

CC.

Basic economics (5, Insightful)

leathered (780018) | about 10 years ago | (#9985038)

It's as simple as this, if people save money by going with OSS then they have more money to spend elsewhere. One industry shrinks, another grows.

I install Linux, Microsoft loses. Because I installed Linux I now have more money in my pocket, Brewing industry gains.

As long as such changes are gradual, the impact on the economy is nil.

Re:Basic economics (0)

Anonymous Coward | about 10 years ago | (#9985159)

why does linux suck? every install always has something missing or when you try to install something it does not work?!?!

One Assumption (1)

baudilus (665036) | about 10 years ago | (#9985243)

I install Linux, Microsoft loses.

On a single user level, this is true only if you would have paid for Windows otherwise. Most people interested in installing Linux are savvy enough to know how to get Windows for free. In that case, whether they installed Linux (free) or stole Windows (free), Microsoft loses.

On a corporate level, since companies can usually count on being sued for having unlicensed copied, this argument holds true. This is where M$ can really be hurt, because Corporations are where M$ makes their bread - but it would take some propgation of linux for Microsoft to begin really worrying about it. They know that Company A will not switch to Linux because then their stuff may be incompatible with Company B, and so on.

Which ushers in that whole "trying to be like Microsoft" debate that slashdotters are so fond of...

What were we talking about again?

Way I see it... (2, Insightful)

Meat Blaster (578650) | about 10 years ago | (#9985048)

It's shifting the temporary power that has been achieved by the individual programmer (low cost of investment, high rate of return) back to the corporation.

Think about it. Where once a whole slew of programmers might have been hired to work on an inventory or billing system, for example, now a fraction can be hired to tweak what the rest have been producing for free.

One could hardly call this anything other than neocapitalism. Under the guise of not reinventing the wheel (a process which actually contributes innovation by demonstrating multiple ways of reaching the same goal, some better than others) businesses are able to make their programming dollar go further at the expense of the programmer.

While it is indeed possible for programmers to wait tables in their spare time, I would like to suggest that waiters do not need to invest 4+ years of schooling in their vocation. At some point this must be recouped or the quality and availability of programmers will decline.

Unfortunately, both the hacker mindset and the CEO mindset are currently geared towards the concept of free software -- the hacker for the love of the code and the CEO for the love of free code -- and damned be the concepts of effective software engineering, security principles, or a day's pay for a day's work.

Re:Way I see it... (1)

johnnyb (4816) | about 10 years ago | (#9985206)

I don't see how the hacker ethic removes " a day's pay for a day's work". Previously, we were getting a year's pay for a day's work. This will simply shift the workforce so that a smaller percentage will be computer programmers, and the remainder can go into other fields. The computer industry's productivity has been horrible because of the large numbers of coders required to do even simple things on proprietary platforms. This also means that we have a lot of lower-skilled people here - people just for the money who really have no love for computing or any real adeptness.

Just go to an IT department of anything larger than a small corporation and you'll see what I mean. I remember talking to the senior developer at an IT shop for a hospital, and talking about COM interfaces, and she said "didn't Visual Basic remove the need for COM?" Ahhhhh!!! The _senior_ developer!

Harm the world economy? No, but (3, Insightful)

bmac (51623) | about 10 years ago | (#9985051)

Doesn't anyone else here see the absurdity
of providing high-quality software (via your
precious time) for free to the corporations
that do not give us their technology, food
or services for free?

I'll say it now, and I'll say it again,
those mutherf**kers are not getting one
minute of my time for free. Period.

Peace & Blessings,
bmac

Re:Harm the world economy? No, but (1)

foobsr (693224) | about 10 years ago | (#9985187)

Hmm, with a little visionary power you might conjure up a cleverly designed social engineering scheme, roughly ...

0. Diagnose a social movement that has to be dealt with
1. Create an enemy: M$
2. Channel the movement: RH
3. Conquer: IBM (while taking care of distraction: SCO)
4. ... erm ... profit here


CC.

Re:Harm the world economy? No, but (1)

ryane67 (768994) | about 10 years ago | (#9985216)

I totally agree with you here.

So lets say I put 150 hours into an OSS project, what do I get back out of it from the 500 big companies that take full advantage?
Oh what's that?
Nothing?
Yeah thats right.
I dont get squat, and those big companies that are using what we made for no cost to them other than possibly hiring 1 of say.. 50 of the people who worked on it?
Yeah, thats really worth spending MY time on..
Sorry but Id rather sit in the other room watching TV with my wife.

Communism isn't a dirty word (4, Informative)

Carnage4Life (106069) | about 10 years ago | (#9985059)

The notion of "From Each According To His Abilities, To Each According To His Needs" which is the core of Karl Marx's philosophy is also the core of Open Source ideals. Those of us who can code give away our code so that everyone who needs software can benefit.

The fact that the Cold War happened and 'communism' became a dirty word in the U.S. and other western nations doesn't make Open Source any less about ensuring that everyone can enjoy the fruits of the labor of the most talented without the necessity of enriching the producers of the software or discrimination against those that would not be able to afford software if it was proprietary and commercial.

Re:Communism isn't a dirty word (1)

johnnyb (4816) | about 10 years ago | (#9985227)

The problem of communism is that it _forces_ giving. That's the big problem with it. Forcing someone to give what they created to someone else is stealing. The given platitude is actually based on Biblical principles, but even in the most giving times of the Bible, giving was based on free will not coersion.

Software didn't alway cost money (4, Interesting)

FunWithHeadlines (644929) | about 10 years ago | (#9985066)

Historically, software didn't always cost money. In the early days programmers shared technology. Then an industry came along that started charging money for closed-source software and they did very well. But this is not the automatically normal state of affairs, and in some ways is an artificial construct in the larger scheme of things.

There are several companies that have embraced FOSS and are making good money. Not by charging money for the software, but by providing services. We always think of Red Hat and the like, but now think of IBM and they way they have embraced the FOSS world yet still make mega bucks providing their services. Linux, for instance, is not the basis of IBM's offerings, but merely one solution they provide. They don't charge for that software, but they do very well capitalistically speaking. There is no conflict between capitalism and FOSS, it merely shuffles the equation around a little. Instead of charging for the software, you charge for your knowledge in other areas. Then you 3. Profit!

Closed-source software houses that screech about their lost profits and how important it is to America to maintain their stranglehold on this part of the economy sounds just like the RIAA. "Save our artificial business model!" Well, it's articifical, and as a business model its time is drawing to an end, or at least being marginalized. Time to make the choice, do you want to be like the buggy-whip manufacturers and the RIAA? Or do you want to be like IBM and make profits from embracing FOSS.

Re:Software didn't alway cost money (1)

js3 (319268) | about 10 years ago | (#9985146)

huh? software didn't always cost money? since when?

It's been good for my personal economy. (2, Informative)

4D696B65 (802211) | about 10 years ago | (#9985069)

Without open-source software (linux), the smaller companies for whom I have consulted would not have readily had the budget to hire me. Even though I'll happily work on commercial UNIX systems, the availability of Linux has contributed greatly to to my consulting cash-flow especially since the downturn in the economy.

Open Source and Concentration of Power (4, Insightful)

randall_burns (108052) | about 10 years ago | (#9985074)

My own perspective is that Open Source can play a major role in reducing major concentration of power (both financial and political). I tend to see both communists and capitalists(even anarcho libertarians) as largely favoring concentration of power-despite much rhetoric to the contrary. Overall, I tend to see decentralization of power as a very good thing.

However, there are some issues that concern me:
will decentralization have negative side effects like getting advanced weapons technology into the hands of folks that seriously misuse that technology?

economics (3, Insightful)

sstory (538486) | about 10 years ago | (#9985097)

In a free market, commodity prices inevitably trend toward the marginal cost. With software, the marginal cost is zero, and the popular and best OSS apps (linux, apache, mozilla...) are generally commodity-type items. So far from being communistic, it's coherent with market principles.

only communist if (2, Insightful)

bigpat (158134) | about 10 years ago | (#9985105)

OpenSource Software would only be communist if people were forced to perform work for the "common good" Instead people have their own reasons for creating open source software. Some of those reasons are market driven such as wanting to create a demand for services that otherwise wouldn't be needed. Or some are socially motivated, such as wanting acknowledgement or to help improve society as has happened with the explosion of communication on the web and internet.

If people were somehow prevented from writing Open Source Software because it can take some jobs away from certain companies or some other reason, now that would be communistic.

People are free to create and decide what they want to do with that creation. Communism is all about others deciding for you.

Services are the future (4, Interesting)

Bruha (412869) | about 10 years ago | (#9985107)

Lets take for instance if all the telecommunications companies in the US were forced to give up their lines and hand the upgrading and maint of them to a centeral company. This company would be regulated by the government for prices and what upgrades need to be done through contributions by the "Telecommunications Services Companies" and taxpayers.

It would be my belief that you would see wide adoption of Fiber to the Premises in a much quicker manner than currently being shown by SBC and Verizon. Futhermore those companies that have this huge debt cloud that the fiber would never make money can then focus on providing services over those lines. Also they would not be restricted to the areas they are currently in so in essence I could be a Verizon Customer until I get a better deal then switch over to Comcast who would provide services via my fiber connection.

In essence the national telecommunications network would be considered the Linux of our telecommunications backbone. Verizon, SBC, Cable Companies etc would be considered in the same light as Redhat, Novell, Mandrake and others. It's a common platform and the services are being provided.

The only problem with this is that Linux has yet to be standardized in a acceptable manner. Mandrake looks different from Redhat who looks different from Novell. Fix that, standardize what's being done to the kernel and fight for customers with support and product contracts and we can kiss MS goodbye.

Linux service providers (LSP)'s should be going to Corporations and telling them we'll provide you this service that will eliminate this problem or situation. You have to adopt Linux on that platform but for a fee we will make it do what you want and provide training and support for the life of it.

Other companies should be investing in end to end solutions built on Linux that are standards based and drum up companies to adopt this. We see it in many places today but adoption is slow but picking up very quickly.

Other companies who are standing on the sidelines wondering about this SCO business need to realize all the money they are throwing away and finally need to give the finger to SCO and get on with the conversion. Service disruptions to a Microsoft based virus over the last 2 years have far outshined any royalty payment you would ever have to pay SCO if hell froze over and they won their court cases. Go out and find those balls you had when you made these companies so great and use them again for once.

Only big corps are making big money (1)

js3 (319268) | about 10 years ago | (#9985114)

It looks like only the big corporations can make big money out of open source. Granted the rest of us poor losers get software for free but nothing else from the effort, while the big corps put in no effort and reap big money.

The broken windows fallacy (3, Interesting)

MoralHazard (447833) | about 10 years ago | (#9985127)

This reads like a response to one of MS's most common attacks on OSS, especially when pitching to governments, about how increasing demand for OSS => decreasing demand for proprietary software, which causes the loss of jobs becasue OSS people do it for free, not as a career.

Which is bullshit.

1) Many, MANY OSS programmers work for traditional companies, which may or may not be primarily software companies. Really, it's not a case of some unpaid commie hippie stealing an MS programmer's job, it's a case of a well-paid IBM programmer stealing an MS programmer's job. Which is fine by me--the market at work.

2) The OSS development model seems to have lower overall costs associated with it--open-source projects can give you the same functionality and features, but the total cost of developing all that software is much less than the total cost of developing the congruent proprietary product. This is GOOD, because it means that less people are doing more work, which means we're more productive and efficient. MS hurts because they're not able to compete with the more efficient (and therefore cheaper to the consumer) OSS product, and they lose revenue. Again, fine all around.

What this is REALLY about is that OSS is a different management model for building software, and it's a model that's based on a different understanding of how best to profit from your ownership of intellectual property (copyright on software you've written/had written by others). That's why MS has started an internal drive to study the development process used by the kernel coders and others--they want to see if they can take some of the techniques and processes that are OSS and apply them to help MS become more competitive.

Carrying the argument to the extreme ... (0)

Anonymous Coward | about 10 years ago | (#9985133)

Suppose that we all had to pay a license fee to the estate of the guy who invented fire and the guy who invented the lever and the guy who invented the wheel .... The resulting friction on the economy would kill it.

The reason we have civilization at all is that we can freely use the ideas of others. In the words of Newton, we can "stand on the shoulders of giants."

Free inputs do not hurt the economy. There is a place for proprietary software and people can still make money from it when it is appropriate. It would be like paying a scientist to do some research for you.

Saying that if open source predominates that people would not have the incentive to create is like saying that scientists will not research unless they can license all their discoveries.

Yeesh (2, Insightful)

Otter (3800) | about 10 years ago | (#9985152)

This is fighting stupid with stupid. I realize that when you're a college student, the world seems to be divided into exclusive spheres of Maoism, Objectivism and frat parties but in the real world, arguing whether something is "communist" or "capitalist" is just silly.

A more interesting question is whether it's sensible for professional programmers to insist that their labor is worth nothing. Or whether it's logical for them to insist that that their labor is worth nothing but that it's an outrage to replace them with someone earning half as much.

Open source is capitalist as fuck... (0)

Anonymous Coward | about 10 years ago | (#9985160)

If I can implement my proprietary closed source business logic using nothing but open source tools, I will. And I'd like to release any generic tools created in this effort back to the open source community.

RMS is a little bit out there, though, but he doesn't represent all open source software. Not all software should be free, and a lot of it simply can't be. But having all the building blocks being open source and free is a very good thing for the industry as well as technical innovation in general. The GPL has its place, but there are cases where the license kills its usefulness.

Also, any project that is generic and doesn't contain proprietary business logic, is best as open source software. You just can't sell software the same way as before. Custom software, tailored towards very specific business needs, is where the money is. The market for generic tools is shrinking, and only truly good tools will survive, but for how long?

does anyone take that rant seriously? (5, Insightful)

MattW (97290) | about 10 years ago | (#9985164)

I've never understood how people took the rant about free software being communist seriously.

Are lawyers doing pro bono work destroying the market for lawyers? Are doctors who work in a clinic as volunteers destroying the demand for medical services? Are all the people out there who write articles or novels and give them away for free "destroying" the market for books? Of course not.

It's foolish to assume that the best OSS software authors act entirely selflessly. If you could make $50/hr at a corporate software shop, or make a name for yourself on 10-15 hrs/week in coding for free and then command $150-200/hr for the other 25-30 hrs a week, what would you take? I'm making way more money than I ever did in a "real" job as a consultant, and I do it on my schedule and my terms. I got this by releasing a little OSS package... one that isn't even in use any more because I didn't have time to maintain it and it was fairly early-stage. But within weeks of putting it out, I was getting inquiries about modifying it on a per-hour bsais, and I've had a full schedule for over 16 months and more than 1 full time job offer that I've turned down.

Also, it sort of assumes that there's some competition between OSS and certain alternatives. If I had a choice between a free IIS and a $100 copy of Apache, I'd buy Apache. If I had a choice between a free winXP, and paying $89 for linux, I'd take linux. (And I'd dual boot to free windows so I could play games :p)

I'm sure for a lot of people, "free" is a nice thing. But you know what? It's been pointed out before: license fees on software are often a tiny fraction of TCO. OSS is often superior not because of the software cost, but the associated costs.

As far as the "World Economy" goes, this question is in the "Give Me a Break" category. It's like asking whether free medicine would help or harm the world economy. The only difference is there isn't an army of altruistic and excellent drug manufacturers like there are software developers.

Re:does anyone take that rant seriously? (1)

argent (18001) | about 10 years ago | (#9985219)

Are all the people out there who write articles or novels and give them away for free "destroying" the market for books?

Not to mention them eeeeeevil libraries!

Linux makes jobs (5, Interesting)

NigelJohnstone (242811) | about 10 years ago | (#9985173)

He missed a major point in section 7.

LINUX MAKES JOBS.

Its very simple, Microsoft's revenue is $36.8B it employs 55000 it has a high revenue per employee of $669k. It has a monopoly so that high revenue/employee is not suprising.

Other companies are not so lucky:

GE revenue is 140 Billion, it employs 305000, thats $459K per employee.
Citigroup $240K per employee
Walmart $183K per employee...

If companies spend less on Microsoft products and invest it in their own business with similar results to their existing business, then they will create more jobs.

So, if Walmart saves 10 million by not buying Microsoft licenses and switching to Linux
and invests it in its own company, it will likely create 55 jobs.

Microsoft will lose $10m (i.e. 15 jobs). A net gain of 40 jobs.

Walmart jobs are low grade, a more realistic example is Citigroup. 10 million saved on Windows licenses is worth 26 extra jobs.

My point is, it isn't just that companies spend the money on themselves, it's that they employ more people for each $ revenue than Microsoft, so every dollar saved creates more jobs than a $ going to Microsoft.

Re:Linux makes jobs (1)

WindBourne (631190) | about 10 years ago | (#9985257)

More so than Revenue, you should look at MS Profits / employee vs Walmart/Citigroup/ etc profits/employee.

Don't fall into Microsoft's trap. (4, Insightful)

IGnatius T Foobar (4328) | about 10 years ago | (#9985186)

It should be painfully obvious by now that Microsoft's current MO (aside from funding the litigious bastards [sco.com] at SCO, and their current astroturf campaign about patents) is to lead everyone in the wrong direction about what "free" means (i.e. gratis instead of libre) and then tear down any claims made by that assumption.

Don't fall into Microsoft's trap. When talking about open source with colleagues, customers, etc. make sure they know about the true benefits. Lower TCO is part of the picture (and it does have a lower TCO when anyone not reciving Bill Buck$ is doing the measurement), but there's also the ability to interchange components at will, and the ability to interchange vendors at will, which gives everyone more leverage with their vendors. With open source, everyone wins except for software companies who have built their businesses around lock-in.

If nothing else, this whole thing should serve as a stellar example of why the phrase "open source" is an order of magnitude more versatile than the ambiguous "free software." There's no confusion as to what it really means.

Why is Open Source even considered Communism? (2, Insightful)

RWaye (778934) | about 10 years ago | (#9985197)

If we use the same logic that concludes that OS is communist, then we can conclude that some other famous orginizations(even countries) are communist as well:

Canada - Free healthcare? Those bastards!
The Red Cross - Stealing money from the healthcare industry!

There are many others. Can you think of some?

It's not Linux specifically (1)

LittleLebowskiUrbanA (619114) | about 10 years ago | (#9985234)

It's Open Source. Linux is an Open Source project. Like Apache, PHP, OpenBSD,etc.. all of which are not Linux. Sheesh, you'd think a /. editor would know the difference.
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