Policy Debate: Can open-source software survive?
Issues and Background
Extracting money from users of a program by restricting their use of it is
destructive because the restrictions reduce the amount and the ways that the program can be
used. This reduces the amount of wealth that humanity derives from the program.
~Richard Stallman, "The
Of course, potential investors have every right to be skeptical
of open-source-oriented business plans. And those who echo Linus Torvald's
joking "world domination" call to arms may do themselves more harm than
good through their unbridled optimism. Open source is no panacea, and
it is has some very obvious shortcomings. Most open-source software, for
instance, is written by hackers aching to "scratch their itch" - to solve
some particular problem unique to their own circumstances. It is far from
clear that itch-scratching will lead to user-friendly interfaces that
can match the sophistication of Microsoft Windows or the Macintosh OS.
Will an open-source project produce an interactive help system useful
to computer illiterates? No one really knows.
In the early years of computing, a substantial portion of software code was freely
distributed by software developers. By the 1980s, however, most software
was distributed using a proprietary model in which the companies selling
the software maintained exclusive ownership of the software code. In most
situations, software purchasers received licenses allowing them to use the
software, but the users rarely received copies of the software code. In
recent years, however, a growing amount of software is produced under open-source
software licenses that allow programs to be freely copied, modified, and
~Andrew Leonard, "Open
Season", Wired, May 1999
The open-source software movement began, to a large extent, with the
free software movement of the early 1980s. The GNU project, begun by Richard
Stallman in 1983, was an early large-scale (and successful) attempt to
provide a free alternative to the Unix operating system. (GNU stands for
"GNU's not Unix" -- those with programming experience will notice the
recursive nature of the definition.) A critical step in the development
of a free alternative to Unix was provided in 1991 with the development
of Linus Torvald's development of the Linux kernel, a free alternative
to the Unix kernel (the heart of the operating system). Most microcomputer-based
Unix distributions involve combinations of the Linux kernel with Unix
components from the GNU project. The Red
Linux distributions are all derived from this open-source project.
The phenomenally rapid growth of the Internet in recent years has been
achieved, in large part, by an extensive reliance on open-source software.
an open-source software project, is the most commonly used web server.
Most e-mail on the Internet is ultimately sent by Sendmail,
another open-source software project. Communications across the Internet
rely on the Domain Name System provided by BIND,
still another open-source software project. In a relatively bold experiment,
the development of Netscape has been shifted to the Mozilla
open-source software project.
Advocates of open-source software argue that software innovations represent
a public good since the marginal cost of allowing another person to use
the software is zero once the software is created. In such a situation,
license fees reduce the benefit received by society since some users will
not acquire the software. Those who believe that a proprietary model is
more efficient argue that there is too little incentive for individuals
to devote efforts to successful innovation under an open-source arrangement.
While voluntary monetary contributions from users under a shareware license
system may provide some income to programmers, advocates of the proprietary
model suggest that the free-rider problem will result in too low a level
of innovative software development.
Those who advocate an open-source model argue that developments in object-oriented
programming have substantially lowered the minimum efficient scale associated
with software creation. This reduction, combined with the lower cost of
information exchange resulting from the growth of the Internet, makes
it possible to engage in software development projects that involve a
large number of independent developers. It is argued that this makes it
possible for projects to exploit gains from specialization and division
of labor that could not be realized by even the largest software companies.
Open-source software supporters also argue that software bugs are more
likely to be detected and corrected when everyone has free access to preliminary
(beta) versions of the software and all programmers can freely examine
the source code for programming flaws.
Proponents note that most software projects consist of a large number
of tasks. Many of these tasks must be executed in many other programs.
Open-source software makes it possible to reuse software code in different
projects. Under a proprietary software system, this code must be rewritten
by many programmers working in different companies. A monopoly software
company that produces an extensive mix of application and operating system
software would have substantially lower development costs in such an environment.
(This argument may partly explain Microsoft's dominance in the market
for PC application and operating system software.)
Proprietary software companies argue that they have more incentive to
deliver quality products and to successfully innovate. They claim that
commercial software developers have an incentive to release only high
quality software in order to maintain the reputation of their brand name.
It is suggested that for-profit companies have much more incentive to
respond to customer concerns and complaints than those who develop open-source
software as a hobby.
Proprietary software companies also note that open-source software projects
are always at risk of "forking," the development of alternative (and incompatible)
versions of an open-source software package. This phenomena presented
some problems in the early years of Unix when software companies created
their own incompatible variations of the Unix operating system for mainframe
computers, minicomputers, and workstations. Advocates of open-source software
note that there is generally only one individual or organization who controls
the "official" release of any software project. When other programmers
provide substantial improvements in software, these are generally incorporated
into the official release fairly quickly. Open-source advocates note that
the "forking" problem in Unix was the result of proprietary software companies
developing their own extensions and variations to the original Unix operating
Ultimately, the success or failure of open-source software development
will be determined in the market.
Primary Resources and Data
- GNU General Public License
The GNU General Public License contained on this page is one of the
most popular open-source license agreements.
- Artistic License
The Artistic License in an alternative open-source license arrangement.
A statement of this license appears on this page.
- Debian Social Contract
This page contains Debian's software license agreement. This license
agreement was used as the basis for the definition of open-source software.
- Free Software Foundation
This is the web site of the Free Software Foundation, the organization
that oversees the GNU Project.
- Free Software (Open Source)
This is the home page of an organization dedicated to the creation of
open-source software. This web site contains links to an extensive collection
of Internet resources that contain information on open-source software.
- Linux Online!
The Linux Online! web site provides an extensive collection
of information and web links related to the open-source Linux operating
- Bernard Lang, "Freeware Licensing"
Bernard Lang provides an extensive collection of links to Internet resources
that deal with alternative freeware licensing arrangements (including
the most common open-source software licenses).
- Bruce Perens, "The Open Source Definition"
Bruce Perens, the Treasurer of the Open Source Initiative, provides
a careful discussion of the definition of open-source software and the
advantages and disadvantages of the major open-source license arrangements.
The Open Source Initiative was organized in early 1998 in response to
Netscape's announcement that it would release the source code for Navigator.
The term "open source" was adopted as an alternative to the earlier
"free software" label in an attempt to make greater inroads into the
business community. This organization's web site provides extensive
information about the history and evolution of the free software/open-source
initiative. It also provides a collection of arguments supporting the
use of open-source software. The FAQ
document at this site provides useful information on open-source software
- GNU Project home page
The GNU project home page contains extensive information about the history
of open-source software development. It also contains an extensive collection
of links to web pages that provide information on open-source software.
- Netcraft Web Server Survey
The Netcraft Web Server survey provides time-series data on the market
shares of the major web server software packages. The open source Apache
web server currently has a commanding lead in this market.
- The Apache Software Foundation
The home page of the Apache Software Foundation provides extensive information
on the open-source Apache web server package. It is the most popular
web server on the Internet.
Sendmail is an open-source software package that handles most of the
e-mail sent over the Internet. The Sendmail Consortium provides the
open-source version of sendmail. This consortium receives programming
and financial support from Sendmail,
Inc., a company that provides sendmail support and commercial versions
of sendmail (and related software).
- ISC Bind
Berkeley Internet Name Domain (BIND) is an open-source software package
that provides most of the Domain Name System (DNS) resolution on the
Internet. This software makes it possible for user-friendly URLs (such
as "http://www.yahoo.com") to be converted into the Internet addresses
at which the web sites reside (Yahoo's current Internet address is 184.108.40.206).
The Internet Software Consortium (ISC) provides BIND at no cost under
an open source software arrangement, but charges for support contracts.
The GNU Network Object Model Environment (GNOME) is an open-source graphical
user interface and collection of software applications for the Linux
operating system. It provides an environment that is similar in style
to that provided by the Microsoft Windows operating system.
- Perl Mongers
The Perl Mongers web site contains information about Perl, an open-source
programming language that is widely used in Internet applications.
- BSD Unix
The BSD Unix operating system is an open-source system originally developed
at Berkeley. This page contains information about, and links to, the
home pages of several variants of this operating system.
- Mozilla Project
The Mozilla project, sponsored by Netscape, is the open-source development
program for new releases of the Netscape Navigator browser. This web
site contains information on the status of the development project and
downloadable nightly and milestone builds of the browser. Most of the development focus has shifted
in recent years to the Firefox web browser and Thunderbird e-mail client.
- The Open Science Project
The Open Science Project is an attempt to encourage the development
of open source scientific software. It contains links to sources of
information about the development of such projects, sorted by academic
- Working group on Libre Software, "Free Software / Open Source:
Information Society Opportunities for Europe?"
This document contains a discussion of the advantages and disadvantages
of open-source software. It also provides a description of alternative
economic models of open-source software development.
SourceForge.net is a website that contains an extensive collection of downloadable source code and executables
for open-source software projects.
Different Perspectives in the Debate
- Eric S. Raymond, "The Cathedral and the Bazaar"
In this online document, Eric S. Raymond discusses the advantages of
open-source software development over proprietary development systems.
He uses an analogy in which the traditional software development model
can be represented by a cathedral while a bazaar serves as a representation
for open-source development. The "cathedral" approach involves one individual
or a small team of individuals developing a software project through
careful planning and coordination. The bazaar style of development relies
on many independent users who work independently. Raymond uses the development
of the "Fetchmail" program as an example of the successful application
of this development process.
- Netscape, Press Release on the Release of Navigator Source Code
This January 22, 1998 press release contains the official announcement
that Netscape would provide a public release of the source code for
its Navigator web browser.
- Nikolai Bezroukov, "Open Source Software Development as a Special
Type of Academic Research (Critique of Vulgar Raymondism)"
In this online document, Nikolai Bezroukov provides a critical review
of the arguments used by Eric S. Raymond in "The Cathedral and the Bazaar."
Bezroukov discusses a variety of practical problems associated with
implementing open-source software development.
- Josh Lerner and Jean Tirole, "The Simple Economics of Open Source"
In this online working paper, Josh Lerner and Jean Tirole investigate
economic explanations of the open-source software development model.
They observe that several open-source software projects have been the
dominant software packages in their product categories. Lerner and Tirole
also note that open-source software projects have been the recipient
of large capital investments by major corporations in recent years.
This paper provides a detailed discussion of three open-source software
projects: Apache, Perl, and Sendmail. Lerner and Tirole suggest that
open-source programmers are motivated by two closely related incentives:
career concern and ego gratification. (The Adobe Acrobat viewer plugin is
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- Justin Pappas Johnson, "Economics of Open Source Software"
Justin Pappas Johnson examines the economics of open source software in this May 17, 2001 MIT
working paper. He analyzes the advantages associated with a large knowledge base under open source
development and testing, along with the disadvantages associated the the
free-rider problem that exists as a result of the public-good nature of the open-source software
product. Johnson observes that some software will not be created under an open-source incentive
system. (Some of the analysis in this paper is relatively technical.)
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- Frank Hecker, "Setting Up Shop: The Business of Open-Source
Frank Hecker provides a detailed discussion of the advantages of open-source
software in this online article. As part of his discussion, he describes
the alternative license arrangements and methods of revenue generation
for companies involved in creating and distributing open-source software.
He provides examples of firms that are currently pursuing successful
and profitable strategies of providing open-source software and related
- Gerald P. Dwyer, Jr., "The Economics of Open Source and Free
Gerald P. Dwyer, Jr., an economist at the Federal Reserve Bank of Atlanta,
attempts to explain why people work on open-source software. He notes
that most modern software can be written in small pieces. Dwyer argues
that there are significant diseconomies associated with writing an individual
program. He suggests that, in the presence of transaction costs and
network effects, it is efficient for programmers to write small portions
of the code for software projects and distribute their work to others
(as long as others do so as well). Coordination of such projects is
usually undertaken by the initial developer of the software. The pecuniary
return for such coordination is received in the form of the higher income
that results from the reputational effect of their development efforts.
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- Rishab Aiyer Ghosh, "Cooking pot markets: an economic model
for the trade in free goods and services on the Internet
Rishab Aiyer Ghosh argues that there are tangible market dynamics in
the open-source software market. He suggests that the Internet is "an
implicit barter economy with asymmetric transactions." The primary commodity
traded on the Internet is information. Ghosh argues that developers
of open-source software contribute their expertise in a manner similar
to those who post information on newsgroups or create web pages. Individuals
provide postings on newsgroups, create web pages, and write software
partly because of the positive effect such contributions have on their
reputations. A reputation for writing high quality open-source software
often provides enhanced employment opportunities for software developers.
Ghosh also notes that many individuals work on open-source software
development because they enjoy the process of writing programs that
are useful to others.
- John M. Gallaugher and Yu-Ming Wang, "Network Effects and the
Impact of Free Goods: An Analysis of the Web Server Market"
John M. Gallaugher and Yu-Ming Wang investigate whether network externalities
exist in the web server market. Network externalities occur if a product
becomes more valuable when more people use it. Word processing and spreadsheet
software, for example, might be expected to become more valuable when
there are many other people who can read the files that are created
with the software. These authors find evidence of network externalities
in the market for Windows web servers, but no evidence of network externalities
in the Unix web server market.
- Philip E. Varner, "The Economics of open-source software"
Philip E. Varner examines the economic issues surrounding open-source
software. He presents statistics illustrating the remarkable success
of several open-source software packages. Varner argues that open-source
software may be profitable for companies that:
- sell software support services,
- use open-source software as a loss leader that attracts customers
to their for-profit products,
- encourage users to develop open-source software drivers for the
company's hardware products, and
- sell accessories (such as texts, t-shirts, etc.).
- Scott Berinato, "MS Exec: What Linux Threat"
In this March 3, 1999 article, Scott Berinato interviews Ed Muth, a Microsoft executive, concerning the threat
of competition from Linux. Muth argues that Linux is more costly to consumers than Windows since there is less integration
among programs and between the operating system and system software. He argues that Linux will not be successful with businesses
or the general public unless a large base of high quality off-the-shelf software becomes available to users. (The full article
is no longer available, but this excerpt captures the main points.)
- John Kirch, "Microsoft Windows NT Server 4.0 versus UNIX"
In this November 10, 1998 article, John Kirch compares the performance of Windows NT Server 4.0 and a variety of
UNIX operating systems. He notes that most of the pressure to use Windows NT comes from management and not from
those who are familiar with operating system performance. Kirch provides several examples of the increased flexibility,
stability, and higher performance of UNIX systems over Windows NT.
- Herbert H. Thompson, "Reliability: Analyzing Solution Uptime as Business Needs Change"
In this November 2005 report, Herbert H. Thompson compares the cost of maintaining a SuSE Linux Enterprise
Server system with the cost of maintaining a Windows Server system between July 1, 2004 and June 30, 2005.
Changing business needs were simulated for both systems and patches were applied at one-month intervals.
Three expert linux and three expert Windows administrators managed the systems used in the study. It was found that
the cost of maintaining the linux system was higher as a result of software dependency problems that
occurred over time. Furthermore, each linux administrator used different approaches to resolve these
problems, resulting in greater system heterogeneity over time. (It should be noted that this study was funded by Microsoft.)
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- Richard Stallman, "The GNU Manifesto"
The GNU Manifesto describes the aims of the GNU project. In this manifesto,
Stallman states the advantages of free software. He argues (without
using these economic terms) that software innovation is a public good
since the marginal cost of allowing another person to use the software
is zero once it has been created. Stallman argues that proprietary software
limits the social benefits that society receives. He suggests that shareware
software arrangements, contract software development, or government
finance (possibly funded through a "software tax") of software development
projects could help maintain incentives for individuals to work as software
developers. Stallman notes that under proprietary software systems,
there is a large amount of wasteful duplication of system programming
- Robert Young, "How Red Hat Stumbled Across a New Economic Model
and Helped Improve an Industry"
Robert Young, Red Hat co-founder, discusses the business strategy of
the Red Hat Software company. He argues that open soft software provides
a competitive advantage for Red Hat since it is "stable, flexible, and
highly customizable." Young notes that many people are willing to pay
moderately high prices for the "official" Red Hat release when they
could download it for free over the Internet or buy inexpensive copies
of the CD. He points out that this is quite similar to the market for
Evian bottled water in which people pay quite a bit for water
that is not substantially different than freely available tap water.
- Juancarlo Anez, "The lesson of Agincourt"
Juancarlo Anez provides an analogy between the current position of open-source
software and the October 25, 1415 battle at Agincourt. In this battle,
substantially outnumbered British troops defeated French troops on French
soil. This victory occurred because rainy weather provided an advantage
to the more mobile British over the heavily armored French. Approximately
25 French soldiers were killed for every British casualty. Anez argues
that detractors of open-source software misunderstand the modern software
"battleground." He claims that the current "Internetworked world is
fundamentally different from that on which the current software giants
built their empires."
- Juancarlo Anez, "Programmers or entrepreneurs?"
Juancarlo Anez discusses the revenue and profit possibilities for developers
on open-source software.
- Andrew Leonard, "Linux at the bat"
This October 4, 1999 interview with Red Hat co-founder Marc Ewing provides
an interesting discussion of the business model adopted by Red Hat software.
Ewing notes that open source development of software makes it possible
to gain from the knowledge and experience of the entire software developer
community. He suggests that the development of complex software in a
proprietary manner limits the gains from specialization. Commercial
software developers working on proprietary code often must write code
in areas in which they lack expertise. Ewing suggests that this process
results in either lengthy software development time (as programmers
devote time and effort acquiring expertise) or low quality software
products. (Most of these arguments are contained in part
2 of the article.)
- Mitch Stoltz, "The Case for Government Promotion of Open Source
This article was written by Stoltz in 1999 while he was a senior at
Pomona College. He argues that open-source software, "creates robust,
secure software through a process of widespread peer review." He argues
that proprietary software is written by a relatively small number of
developers who are working under the pressure of deadlines. Stoltz suggests
that the users of commercial software become involuntary testers. That
is, programming errors tend to be found and corrected much more quickly
under open-source software development. Under a proprietary system,
very little software code is reused in other applications. Stoltz notes
that less duplicated development work would take place under an open-source
system. He suggests that open-source software could overcome the tendency
toward monopoly that occurs under a proprietary system as a result of
- Bert Dempsey, Debra Weiss, Paul Jones, and Jane Greenberg, "A
Quantitative Profile of a Community of Open Source Linux Developers"
This online paper provides a quantitative analysis of the contributors
of Linux software to one of the major Linux archives. Dempsey, Weiss,
Jones, and Greenberg find that there is broad participation in software
development, with a disproportionate share provided by European developers.
They also find that this software is subject to relatively frequent
revisions and updates.
- James C. Bennett, "The End of Capitalism and the Triumph of
the Market Economy"
In this excerpt from Network Commonwealth: The Future of Nations
in the Internet Era, James C. Bennett suggests that the open-source
movement is a sign of the end of the capitalist period. He argues that
the manufacture of commodities has been replaced by the production and
distribution of information as the predominant economic activity. Bennett
observes that falling computer prices have made it possible for programmers
to afford their own hardware while the Internet lowered communication
costs. He suggests that the Linux model of production differs from any
previous production model. Bennett claims that new models are needed
to explain these new production and distribution methods.
- Martin Cracauer's GPL Page
On this web page, Martin Cracauer, a user of BSD Unix, argues that the
GNU General Public License is overly restrictive and serves as a barrier
to the development of high quality free software.
- Ko Kuwabara, "Linux: A Bazaar at the Edge of Chaos"
Ko Kuwabara provides a detailed discussion of the process by which the
Linux system continues its development. The theory of complex adaptive
systems is used to explain and describe the process by which Linux develops.
This article also provides an interesting insider's view of the Linux
kernel development process (derived from e-mail interviews with kernel
- Andrew Leonard, "Open Season"
Andrew Leonard discusses the possibilities and shortcomings of the open
source movement in the May 1999 Wired article. He argues that
open-source software development will lower firms' software development
costs, but is unlikely to completely supplant proprietary software.
- Michele Boldrin and David K. Levine, "Perfectly Competitive Innovation"
Michele Boldrin and David K. Levine provide an argument for the abolition of copyright and patent law in this March 2002 Federal Reserve
Bank of Minneapolis working paper. They argue that technological innovation will occur without copyright or patent protection as a result of
the "first-mover" advantage received by innovators. Boldrin and Levine suggest that competitive markets will be more
efficient in encouraging innovation than will monopolies created through copyright and patent law. It is argued that providing
the innovator with monopoly control of the uses of an innovation "reduces the incentive for further innovation." This argument
can be easily used to make a case for open source software.
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- Rob Abel, "Best Practices in Open Source in Higher Education Study:
The State of Open Source Software"
This March 1, 2006 report observes that there is a great deal of discussion of the use of open-source software
in higher education. Despite this discussion, commercial products dominate a large share of the software
usage in higher education. Rob Abel suggests that open-source projects need to demonstrate
a high level of stability before they will be used in place of commercial applications. He argues
that this will occur only if there is a large shift of industry resources to open-source software development.
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- John Mark Walker, "There Is No Open Source Community"
John Mark Walker discusses the open-source software movement in this January 12, 2006 online
article. He argues that the internet provides a low-cost distribution network for open-source
software and allows for the realization of substantial economies of scale in software
development and distribution. The internet provides a first-mover advantage that often benefits
open-source developers over commercial vendors of software. He argues that the nature of the
internet makes it inevitable that open source software will become increasingly important over time.
- Gavin Clarke, "Homeland Security Report Tracks Down Rogue Open Source Code"
This March 3, 2006 online article summarizes the results of a Homeland Security audit of the
security of commonly used open-source software (linux, Apache, MySQL and Perl/PHP/Python). This study
found that this software had a high security rating, containing "only .32 defects per 1,000 lines
- Gavin Clarke, "Developers Get Busy with Open Source Bugs"
This April 5th followup to the report above indicates that the open-source community responded with remarkable speed to
the bugs reported by the Homeland Security audit. It was reported that bugs were fixed at the rate of
one every six minutes.
- Nicholas Petreley, "Security Report: Windows vs Linux"
Nicholas Petreley compares the frequency and severity of security problems associated with linux and Windows
systems. He finds that the severity and frequency of security problems is substantially greater for
- Stanford Project on the Economics of Open Source Software, "NSF Open Source Software Project: Publications"
This website contains links to a collection of studies on the economics of open source software development.