I just finished reaging this aritcle on ZD Net by John Carroll. He continues the error of so many other people in the software industry when looking for the “business model” for open source. They are looking for a way to sell open source when there really is none.

I suppose that it is natural for someone in the “software industry” to assume that the value of software must come from its sale. If my business was selling a particular thing that is what its value would be to me. But the value of software, all software whether closed or open source, is the value of what it is used to produce.

Open source software is not different in kind from closed source, it is just different in the way it is produced. In order for a company to be able to use proprietary software it must divert some of the value of what ever it produces in the form of cash to pay for software. To use open source software it must divert some of its resources in terms of the time of its IT staff and sometimes (often) money to implement it.

But the value of the software is still what it can be used to do, not what it costs to make. No one will use software if it does not produce a return. The calculation of the return is easy to do: did you get something that was worth more to you than what you gave up? If so you got a return on your investment. In almost all cases not having to give up the ability to do as you please with software is worth less, even to companies, than what they get in return.

The value of open source is not what it can be sold for, but the difference in value between what you must give up to get the software and what you can produce with it.

Proprietary software will not go away and I am not advocating it should. People should be able to choose what they want to use. People should also be able to choose how and under what terms they want to make their work available to others. However we should all be clear that it is the people who use software that determine its value, not the people who make it.