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Last Updated: Sunday, 6 November 2005, 09:33 GMT
Open source turns money-spinner
David Reid
By David Reid
Reporter, BBC Click Online

Open source code, written by a community of thousands of software developers, has always been made freely available. But there are ways of making money from it, as David Reid finds out in Amsterdam.

Open source programmers from around the world met in Amsterdam
The Dutch are pretty open about the sort of stuff that many of us prefer to keep to ourselves - what goes on beneath the sheets, for example.

Perhaps that is why Amsterdam was chosen for a recent international get together of the open source movement.

The movement believes strongly that rather than being a trade secret, the source code of the software should be open for anyone to play with.

The result is software like the Linux operating system, created through collaboration that can involve thousands of programmers.

"Early on, when software was developed by computer scientists, just people working with computers, people passed around software because that was how you got computers to do things," explained Tim O'Reilly, the founder and CEO of computer information and publishing company O'Reilly Media.

"What we take as the shape of the software industry today, where software is shrink-wrapped and sold, is really a 20-year anomaly that started in the 1980s.

"Now we have companies like Microsoft as the avatars of that movement. But by the mid-80s there were already people saying 'we don't like this'."

And what they did not like was the idea of closing off information, especially information that others could build on.

Rich pickings

The open source movement does not object to making money. In fact, many of these programmers can afford to be choosy about how they earn.

We now have a world that has distribution costs of zero. We have just built a world-wide copying machine called the internet
Karl Fogel, CollabNet
The source code may be free, but there is gold in software support, training and publishing.

Damian Conway, who trains programmers through his business Thoughtstream, said: "I think the most successful of those is definitely licensing support; providing the software and then saying: 'if you want to buy a support contract, here's what it will cost you on an ongoing basis'.

"That way people are getting something that they can work with free if they want to, but when they get into trouble they have backup and you make some money out of it."

With businesses keen on open source software and the support it offers, geek chic is smartening up. And the software, as well, is now designed by, but not necessarily for, programmers.

Open source might be more user friendly, but can it really go toe-to-toe with the giants in the market place?

Supporters of open source say it brings innovations to the market
Open source has been criticised for devoting so much energy to coming up with open source alternatives to what is already commercially available.

Voluntary collaboration, or so the argument goes, is good for worthy imitation, but it takes money, and lots of it, to truly innovate.

But IBM's Chet Kapoor believes only some of that is true.

"If you look at the open source, open community aspects of open source, they are definitely bringing innovations to the market, solving problems that are not being solved by standardised software," he said.

"These are programmers building great technology to help their peers to build software to solve customer problems."

Business asset

One very recent open source innovation is Flock, a browser that integrates next-generation web technologies such as RSS, blogs, bookmarks and photo sharing.

In fact the fortunes of open source are closely tied to the internet, as well as the fact that copyright and intellectual property are looking difficult to guarantee. Open source, then, might be a model to flock around.

Karl Fogel, from software distributor CollabNet, said: "We now have a world that has distribution costs of zero. We have just built a world-wide copying machine called the internet.

"People who learn to use that copying machine for what it is are suddenly discovering that they can have a great deal of success in traditional business economic terms.

"Freedom is a business asset, under certain circumstances."

If open source really can make money for free, then it might make sense after all to harness the wisdom of the group.

Click Online is broadcast on BBC News 24: Saturday at 2030, Sunday at 0430 and 1630, and on Monday at 0030. A short version is also shown on BBC Two: Saturday at 0645 and BBC One: Sunday at 0745 . Also BBC World.

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