To Open, Or Not To Open

Pearson-Arastradero Preserve, USA

I believe morally and philosophically that not just software, but everything should be open source…” — Matt Mullenweg, founder of WordPress

I shamelessly claim myself a practical open-source believer, and I don’t even mind being called “secular”. Because I’m just a regular Joe, trying to make a living 😅. But, I do try to pick & even champion the projects I work on to be more open-source friendly. For my “2% pet projects”, they will always be open-source. For example, Android System Development On The Cloud.

It’s sad to see open-source maintainers get stressed out due to poor pay. While I do believe most people do open-source for a calling than a payday, it’s still essential for us to innovate better business models to sustain open-source. After all, knowledge is a few rare commodities that we get more when we share 🤝. So, even I’m lucky to have a choice, I’ve been wondering what could be a more sustainable way for open-source to be an inevitable easy way for more businesses. There may never be a “correct” answer, but no hurt for us to explore a few angles for innovators to consider.

SaaS business model

I still remember my Opera(web browser) days as Opera championed open standards(e.g. HTML 5), but closed implementations(e.g. Opera browser engine). Because licensing Opera Browser to device makers, e.g. phone & IP TV makers is one of its main businesses. In hindsight, that might “cost Opera the opportunity to be the WebKit”. Which powers Safari & more browsers. Eventually in 2013, Opera adopted Blink, a fork of WebKit instead of its closed implementation. Even it’s late in the game but better than never 😉. Today, most startups prefer open-source over proprietary because they are “cheap”. However, opne-source is still too scary for the most business. Because, established business models are mostly based on keeping the secret sauce…well, in secret.

The Software as a Service(SaaS) model is not only more open-source friendly, but a better business model for the new digital economy. When you are in the business of making a platform as a service, keeping the source code secret may only give you a false sense of security. Users come to you to get a job done. How good the job is done & the service matters more. It’s not their job to care about how you serve them better. But your service will need to scale via complex software. So, whoever can get all the help in-house or out can do better. Keeping code secret is not just wasting the precious resource, but also slowing down collaboration. Just take WordPress open source as an example, anyone can “steal” their code easily. But in reality, no one has yet challenged WordPress’s lead, managing 42% of the web content. BTW, when it’s in open, there is no market that will “buy” that secret. Instead, a door for a talent community opens.

wordpress.org

Winner takes all

SaaS works better for the fast-rising digital economy. Which fundamentally challenges the classical business strategies. Those classical strategies are mostly developed when most businesses were done physically. The traditional physical market segmentation strategies are not applicable when Product, Transaction(order, payment, information) & Delivery process & Customer support are digitalized. For example, it used to be easy to apply a copycat strategy by the regional segmentation. It works fine when a store provides convenience for nearby customers. Which’s not the case for a web store, which can serve all within the connected & deliverable networks.

Fundamentally, digitalization makes scaling easier. For example, the marginal cost to the next copy is almost zero for a digital good, e.g. from a CD to an MP3 file. When its channel is also digitalized, to distribute another copy is almost zero too, e.g. from record stores to iTune Store. Which makes it’s easier to serve the long tail, and the king has the most power. Just do a simple user test: I won’t bother to consider other vendors when the no. 1 already offers the best deal for me personally, would you?

hbr.org/2008/07/should-you-invest-in-the-long-tail

Top passionate talents around the world

Luckily to build a successful SaaS business, you don’t need to build a capital-intensive company, but a talent-intensive one. Therefore, even silicon valley is very expensive, it’s still a fruitful land for startups. To keep the edge, a platform service player will need the top passionate talents around the world working together to make the best platform.

Open-source does not only enable that but also make it easier for anyone to work anywhere as long as a reasonable connection is available. Furthermore, it also opens opportunities for outsider contribution, collaboration & even attracting young talents.

More importantly for a Business-to-Business(B2B) platform, open-source can reduce concerns & barriers for others to adopt. Because it’s typically cheaper, and they have better control of their own destiny. One more bonus: as a critical mass is building up, it becomes easier for adjacent innovators to build something great faster based on your foundation and be a force to expand the community.

Today, as you are thinking about the new normal after COVID, you can choose to shape it better & more autonomy for the next generations. Sure, there are many other ways to make it easy for your employees to work from anywhere. But, why not open your mind to leap forward with open-source.

ma.tt/2020/04/five-levels-of-autonomy

Open-source friendly business environment

Thanks to OpenSSL, so you can surf the web securely. But in 2014, The New York Times broke a news & many hearts: the Heartbleed security flaw was left in OpenSSL for 2 years, there was only one full-time developer & generated less than $2K in donations a year. With all due respect, but we, as a civilization failed miserably here. The business environment has been improved since for sure, but the business environment is far from open-source friendly.

To make open-source as a book opens, there has to be a better way to found & sustain open-source development. Unfortunately, the world is too familiar with the traditional purchasing, renting, and even ads business models. The macro environments are turned & even reinforce. Which can be very difficult for a new open-source venture to fit in. But, “your problem is my opportunity”, brave innovators go craze to innovate & build the right business models for you. It won’t be easy, but that’s exactly the playing field a bit more startup-friendly.

I know it can be scary to put your know-how in open. But in the flattening world, the real advantage is not how many golden palaces are in your closed book, but how many great minds cracking the code together, with or without permission. So, how may you build a winning team?

Business as the Greatest Platform for Change with Marc Benioff (Salesforce)

Full Disclosure

The opinions stated here are my own, not those of my company. They are mostly extrapolations from public information. I don’t have insider knowledge of those companies, nor a whatever expert.

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A Taiwanese lives in Silicon Valley since 2014 & has random opinions on some stuff. The opinions shared here are my own, not those of companies I work for.

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Sam Lin

Sam Lin

A Taiwanese lives in Silicon Valley since 2014 & has random opinions on some stuff. The opinions shared here are my own, not those of companies I work for.

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