The open-source business model
There has been quite a buzz about open-source software in the past few years, spurred on by support from tech industry heavy-hitters like Google and IBM. But what exactly is open-source software, and why are so many software developers and corporations embracing it?
####Background
[Open-source software](http://en.wikipedia.org/wiki/Open_source_software) is free software whose [source code](http://en.wikipedia.org/wiki/Source_code) is also freely available for developers to modify and redistribute. Selling the software itself or derivatives thereof is usually restricted by a software license, but developers are mostly free to sell services and products that connect with or run on top of open-source products.
####Open Source and the Business World
Over the past several years, companies like Google, Yahoo, and IBM have come out strongly in support of open-source software, and even Microsoft has made some concessions to the open-source software movement. Given the time and effort that goes into software development, why would a company turn those efforts towards a freely-distributed software package? The answer lies in the changing landscape of software-based business models.
Historically, software has been largely treated as a tangible product akin to computer hardware. The problem with that point of view is that software is easily copied to CD or hard drive, and anti-piracy measures can be prohibitively-expensive and can inadvertently cause major problems for legitimate users. These problems needed to be solved, and while some software producers maintain the tangible-product metaphor, many developers are switching to service-based profit models.
An open-source business model puts a focus on providing service and support for a publicly-available software product, rather than focusing on supporting an in-house product. Generally, this reduces the cost of software development and allows businesses to avoid starting from scratch when creating their own software products.
Open source products also benefits business clients, as the products they are using have been tested by numerous groups of developers and are generally being constantly updated. Support generally tends to be better for open-source products, since support providers can spend more time and resources actually supporting the products rather than working on the product itself.
####Zend and PHP: An Example of the Open Source Business Model
From a web development standpoint, open-source software is essential to remaining competitive in a market with very tight margins. Most web developers couldn’t afford to stay in business if they constantly had to pay licensing fees for software they now get for free. One of the most important and essential tools in the web developer’s arsenal is the PHP programming language, and its development is a perfect example of a successful open-source business model.
The PHP language developed out of a Danish programmer’s desire to create dynamic web pages for his personal site without using the web languages of the day. Released as open-source software, the PHP language was picked up by two Israeli developers and was completely rewritten and again released as open source. These two developers, Zeev Suraski and Andi Gutmans, took over development of the programming language and eventually formed Zend Technologies, a company which currently manages the development of PHP. According to [PHP.net](http://us.php.net/usage.php), PHP is now used on over 20,000,000 websites worldwide. It is by far the most popular web programming language (take a look at some of your favourite Internet sites, chances are that links within one of the sites have .php in the address bar somewhere).
While the PHP language itself remains an open-source project, Zend Technologies has managed to leverage its intimate experience with PHP into a lucrative business, creating products for developers and developing sites for clients. Zend remains the lead development team behind PHP, and their contribution help both their own business and other companies seeking to use PHP in web development.
####Recap
Open-source software is swiftly becoming widely-accepted in corporate circles as an alternative to the traditional software-as-product ideology. Open-source software provides benefits to both developers and users by keeping costs low, allowing developers to focus on expanding the already-existing open-source code base, and allowing businesses to redirect resources that would ordinarily go to development to provide support to end-users.
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Thursday, November 8th, 2007 at 9:20 am and is filed under Articles. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.
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