How do people make money through open source software

[wannabeCoder]

Hi!

I am a novice programmer and I am interested in the concept of community development. I am just curious about whether people are really making money from open source software. If so, how?

Well what I understand from the GPL licence, one can charge for the software but the customers are again 'free' to distribute the software as they wish.

So what is the business proposition of companies like Redhat. Is it that they provide warranty (most open source software is without warranty) and technical support?

I am asking this because I have encountered quite a few interesting and useful open source projects but I personally feel that for them to be successful there should be a way to reward the contributors.

[TwilightSpectre]

The easy answer: Open Source != Free

Read this: http://www.gnu.org/philosophy/free-software-for-freedom.en.html
EDIT: And this: http://www.gnu.org/philosophy/free-sw.html

The first link says the difference between free software (As in the GPL lisence) and Open Source, and the other is about why "free software" isn't free (yet is, at the same time), due to the contrasting meanings of the word "free"

[wannabeCoder]

Actually yes I do understand the different meanings of the term free as in 'free beer' and as in 'free speech', but the question remains as to whether open source can be practically used as a commercial project and how?

[chrisname]

wannabeCoder wrote:

Actually yes I do understand the different meanings of the term free as in 'free beer' and as in 'free speech', but the question remains as to whether open source can be practically used as a commercial project and how?

By selling it... As long as purchasing the software grants you full access to it and its source code, it's still considered "free software". Also, open source projects often charge for support (although of course you're welcome to get free support on their forums). And then there's always the Donate button...

[ResidentBiscuit]

wannabeCoder wrote:

question remains as to whether open source can be practically used as a commercial project and how?

I wrote a whole paper on this. It was focused on the enterprise market, though. Basically, yes you absolutely can and a lot of companies do. I would argue that before long, this business model will have made the traditional proprietary approach obsolete for a lot of domains.

There's a ton of academic articles out there on this topic, if you're interested and have access to a research database.

[Cubbi]

As http://opensource.org/definition says,

The license must not restrict anyone from making use of the program in a specific field of endeavor. For example, it may not restrict the program from being used in a business, or from being used for genetic research.

Academic papers aside, few opensource vendors provide enterprise-level support, so if we need to be able to find a programmer at 4 am for a bugfix to be deployed within an hour, we have to develop sofware in-house (or, where practical, fork in-house) or buy from someone who can do this.

[ResidentBiscuit]

Working in an enterprise environment, I know from first hand experience that open-source vendors do provide enterprise-level support.
It's not uncommon for them to have in-house developers along with taking changes/features/bug fixes from the community.

[Cubbi]

It just goes to show that businesses differ from each other. Someone is okay with having a place to submit a bug report, someone else expects an engineer to arrive on-site within X hours to deal with the bug (I was that engineer), someone else just bills the vendor 100% of lost revenue caused by all software issues (I worked for such vendor)

[ResidentBiscuit]

I don't consider the ability to submit bug reports as support.
With our two major open-source solutions, we get on-site consultation, 24x7 phone and remote troubleshooting, high severity response times < x hours, custom programming, and an on-site support engineer will fly in if need be. Which we have had to use on one occasion.

Both of these products are entirely free to use - the company survives by selling support contracts.

[Dy7SLyTq]

kind of off topic, but the documentary revolution os is the creation of all of this if anyone is interested. and just out of curiousity, is the paper the cathedral and the bazaar still applicable here?

[N36fSL3A]

Revolution OS kinda sucked imo. But it was good at the same time.

Anyway, the answer is donations.

[Dy7SLyTq]

its good if your into that kind of stuff. its a lot like dune in that sense

[Cubbi]

@ResidentBiscuit -- well, I did say 'few', not 'none'. Good for them, wish there were more. And to answer the OP question - that's the way to make that money.

[wannabeCoder]

Thanks, lots of good info on this thread. I read the synopsis for revolutionary OS documentary. Seems interesting to me. Shall view it in my free time.

So the main ways as I understand are:
1. Charge for Technical Support
2. Charge for extra features (like with Qt you are free to release your application under any licence if you buy full Qt licence from them)
3. Donations: But somehow I don't think that a company can base its profits on this.
4. Charge for warranty? Actually similar to point 1.
5. Sell the software with code. Here I have my doubts because your 'clients' can publish or distribute your application/code as they wish (even at a lower fee or free) and if that happens, then why would someone else buy the software from you?

[IWishIKnew]

1 word:

DONATIONS.

[rapidcoder]

The license must not restrict anyone from making use of the program in a specific field of endeavor. For example, it may not restrict the program from being used in a business, or from being used for genetic research.

Then GPL is not really open source (and especially its AGPL variant), because it puts pretty serious restrictions on what you can do with the code - e.g. you can't include it in a closed-source product. True open source are BSD, MIT or Apache licenses. The only restriction is that you must not claim authorship of the code you're not author of (this is different from public domain, which doesn't have even this single restriction).

Methods of earning on open-source:
1. Charging for support and consulting.
2. Charging for additional documentation.
3. Not paying license fees to proprietary software vendors and using open-source software instead (e.g Linux instead of Windows / MaxOSX)
4. Charging for closed source software built on top of open-source ones / providing a "premium" or "enterprise" version
5. Accepting donations
6. Making money on conferences and other events related to open-source
7. Commercial ads on the project website
8. Charging for adapting your own or third parties open-source software to one's specific needs
9. Raising money from investors then selling the company.
10. Raising public money (e.g. scientific open-source projects)

[J4ke]

You can make "future money" with open source software. If you make something that is completely free, you (a) build your reputation as a programmer so that others may buy stuff from you in the future and (b) have something to put on a job application that will make you more likely to be chosen for the job.

[Garion]

I've seen quite a few people make app's and third party tools for online games completely free.

Then people donate money to have new features added or the program updated when a game patch breaks it.

[LB]

You seen a few people make app's what?

[Garion]

Well I guess technically I haven't seen them make it, but I've seen the results.

You'd be surprised how addicted people get to games, checking them on their phones and what not, but also desktop programs for automating gameplay.