Is The Open Source Business Model Broken?

Justin Kerr

Respected Open Source advocate, and CEO of Collaborative Software Stuart Cohen warns that the business model behind open source software companies is broken . And that the nature of these businesses will need to evolve in order to survive. In his article he explains how the traditional model in which companies would freely offer software, and make a living off the support is coming to an end. An end which is likely to be accelerated by the economic slowdown. He cautions open source designers to view the software as more of a means to an end.

As part of his argument, he claims the real value of open source software companies will come from those who can find ways to add value with supporting add-ons and applications. He uses Red Hat as an example of a company that adds significant value to the Linux kernel, and couldn’t survive on support alone. “Open-Soure code is generally great code, not requiring much support”. According to Cohen the true power of the open source community will be realized through the spirit of collaboration. “While the open-source business model may be broken, the concepts behind open source will continue to bring new value to customers and strong returns to software company stakeholders”.

So do you think the harsh economic climate will hurt or inspire the open source community?

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