Value in the open source world

I recently received a valuable comment from one of the 16.48 visitors that see my blog per day (watch out YouTube and MySpace...) that made reference to the role that value creation has within determining the success of open source efforts. Normally, I post my replies to comments directly on this blog or I send them privately to the author's email address. However, this particular comment raises an interesting point that aligns perfectly with a concept that I hold at the center of my
professional approach to covering the open source software industry.

From my perspective, the varied and flexible ways in which open source creates value has been the pre-eminent driving force behind its success. Unfortunately, the vast majority of the discourse related to its value has been confined to a small spectrum of the areas related to software acquisition cost and packaged software flexibility. As a result, very little effort has been devoted to expressing the many other ways that open source provides value outside of saving money from a purchasing perspective and preventing vendor lock-in from an end-user oriented perspective.

So it's quite refreshing to read a comment from a reader (Anthony Gold) who points out the expansive scope of those two areas like the aforementioned [posted below]:

"...Perhaps one other point worth mentioning when predicting the success of a new open source product is the value it creates in the user community. One could argue that Market Demand (or Product Design – meeting functional needs) captures this value creation, but in some cases they may not. For instance, a large number of open source projects enable legacy applications to be rebuilt (or services wrapped) to create much greater flexibility (easier to add new features, greater ability to mine silo’ed legacy data for more effective cross-selling, etc.) plus a lower cost of support (licensing/support fees). So, whereas the functional needs being met are certainly a given, Value Creation is another factor to consider when assessing potential success."

While the topic of how open source is powering the invigoration of legacy based applications and services is one too expansive to fully portray in this post (and probably on this blog), the overall point is that open source is actively creating what I refer to as a value ecosystem that is continuously expanding to include more and more companies, products, services, users, etc.  Anthony does a good job of expressing just a couple more aspects of two value propositions (cost and flexibility) of what is turning into a rewarding approach to doing business.

Technorati Tags: value creation |  open source

Comments

[Dirk Riehle]

Interesting. I don't think saving money or preventing lock-in will stand the test of time. Gold's comment may be more on target.

As to your (Alex) comments: You only save money if you don't purchase. Open source may be cheaper than a proprietary solution, typically, but I don't see why this would always stay like this.

As to preventing lock-in. Why? Open source is software so you get locked in whether open source or not. You are less locked-in for services, but only if you are talking about real community open source, not the common commercial open source we see more and more of every day.

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