Open source – ever more important and profitable

Today the importance of open-source software is growing. Earlier large companies and public administrations treated it with suspicion, but now attitudes to open source are changing. According to the video message from Neelie Kroes, European Commissioner for Digital Agenda, more and more public organizations proudly declare that they are not only using open-source software, but contributing to it.

At the same time the understanding of the term “open source” still remains ambiguous. One of the common mistakes is to consider “open-source” as a synonym to “free”. Let’s examine the meaning of this word from a developer’s point of view.

As a rule, software is provided in a compiled version, no matter if you buy it or use for free. Being compiled means that a programmer used a special type of application called a “compiler” to translate a simple text file into a form recognized by computer. It is almost impossible to see how exactly such software was created and therefore difficult to modify the code. Most software providers see this as a way to prevent other companies from using their code in a competing product. This gives them certain control over the product and its further development.

When the source code becomes open, third-party developers can modify it the way they want to. They are allowed not only to customize it according to their liking, but include its parts into other applications. A reasonable question would be: isn’t it too risky to open program codes created for years by efforts of many people? It is, yet companies continually benefit from open source projects.

Let’s outline the main factors which make open source profitable with time:

1. Trust. Open source allows start-up companies to gain trust among users. The availability of the source code proves that the product is reliable and can be used with no reason for concern.
2. Improvement. By allowing to modify the source code developers believe that their application will be improved more rapidly and will remain error-free over the long term.
3. Customization. Source code gets customized in accordance with demands raised by particular companies. This way code owners not only gain insight into current market needs, but get a chance to include this new on-demand functionality at the cost of third-party developers.

Opening the source code can be really advantageous in terms of profitability. While giving away the source code, companies gain profit by offering paid services associated with it (technical support, hosting, developing custom versions, etc.). But open source can be hardly considered as a business model. This is an ideology followed by those who believe that they can help others to build a better software by sharing the code. Open source as a concept is similar to the Internet. The latter does not bring any profit as the very idea of connecting people, but involves certain fees for using communication services, domain names or programs streaming data from the world wide web.