Developing a FOSS-based Business: Five Questions to Ask

Wednesday Jan 30th 2008 by Bruce Byfield

What license will you use? How will you deal with the FOSS community? Several key points need to be addressed. Plus: where to find help.

Contrary to what you may have heard, free and open source software (FOSS) is not anti-business. But neither is it pro-business. More accurately, FOSS is focused on concerns outside of traditional business, such as user freedom and code quality. For this reason, making the two work together successfully requires special efforts and resources, as well as careful study of the various options.

Fortunately, finding the right interaction is much simpler than it was in the dot-com days, when business first noticed FOSS. Back then, FOSS businesses were mostly pioneers, and had to be mostly dependent on themselves. Now, however, web searches will yield thousands of results on business-related FOSS issues, and both businesses and non-profit groups exist to lend you assistance.

For those thinking of making FOSS part of their business, or those who -- like many today -- have suddenly discovered that FOSS is part of their business and need to regain control of the situation, here’s a guide to some of the considerations, as well as a few resources to bring you up to speed.

1) How does FOSS fit into your business?

The first decision you have to make about FOSS is whether your company will be a user of FOSS or a contributor and distributor of it.

If your company simply plans to use FOSS, then your path is relatively straightforward. Several of the considerations mentioned here will be irrelevant to you, and you may be able to incorporate FOSS into your business without having any contact with the community.

Redistribution is also straightforward. Your main concern will be that you comply with the license under which the software is released. If you don't comply, you may find yourself the defendant in a lawsuit, just as you would if you violated the license of a proprietary license -- and FOSS licenses, while only lightly tested so far in court, have a highly successful record in legal proceedings. In fact, violators typically back down rather than contest FOSS licenses.

However, if you plan to include FOSS as part of your product, your concerns are more complicated. In particular, you need to decide how FOSS will fit into your business plan.

You can find a summary of the basic options for FOSS business plans in Eric S. Raymond's The Magic Cauldron. However, at the risk of over-generalizing, you have two main options: Make the software free and make a living selling expertise and services, the way that Red Hat has done, or maintain two separate versions or licensing options for your software, one free and one proprietary, the way that Trolltech has done.

2) What licenses will you use?

Redistributors of FOSS generally have no choice except to redistribute it under the same license that they received it under. However, if you are releasing your own FOSS, then the matter requires careful consideration.

The Free Software Foundation maintains a list of FOSS licenses. And so does the Open Source Initiative.

As you will soon find, the most popular FOSS licenses are the second and third versions of the GNU General Public License (GPL). However, depending on your business plan, the GPL may not best suit your needs. For instance, if you are maintaining two separate versions of your software, you might consider the Lesser GNU General Public License, which is designed for dual licensing. This is the path taken by Sun Microsystems, which releases the office suite as free software under the Lesser GPL; it releases StarOffice, an enhanced version of the code, under a proprietary license.

If you are unsure what license is appropriate for your business, for a fee you can consult either the Free Software Foundation Compliance Lab, or the Software Freedom Law Center. The Software Freedom Law Center is also a place where your legal counsel can get education in FOSS licensing.

3) How will you control the way that FOSS enters your company?

Because FOSS is readily downloadable, it bypasses normal procurement practices -- which is why you may already be using free software without realizing the fact. A developer can download a piece of free software in minutes, and, in doing so, not only expose the company to possible security risks, but also to obligations and possible license violations that it has no way to track.

To address these concerns, a new field called FOSS governance is starting to emerge, with companies like Black Duck Software, Palamida, and, most recently, Hewlett-Packard, offering software audits of the FOSS currently in your networks. They also offer consulting services to set up software and practices to help you track your FOSS use in the future. In conjunction with The Linux Foundation, Hewlett-Packard also offers FOSSBazaar, a forum and resource center for governance issues.

4) How will you get support and training?

The Internet teems with FOSS resources, the most useful of which are often user forums or IRC channels maintained by a project or business. Although newcomers to FOSS are often suspicious of these resources, in practice these forums are quicker to respond than most paid technical support. Often, they produce a reply in a matter of minutes. Your main problem will not be lack of an answer, but getting so many that you have to sort through and evaluate them.

For small to medium sized businesses, especially ones whose officers have technical expertise, these online resources are more than enough. However, larger companies, or public ones that need to answer to a board of directors, will probably prefer a more formal paid service. There may be no practical reason for this preference other than tradition, but it is widespread all the same.

However, if paid services are your preference, that makes your selection of FOSS easier. You will probably want to avoid community-based software, such as Debian GNU/Linux, which rely on online services, and focus instead on such choices as Red Hat Enterprise Linux, which offer the sort of services with which you are most comfortable.

The same is true of training and certification, although in addition to software distributors, you might also consider independent training companies such as the Linux Professional Institute and CompTIA.

5) How will you deal with the FOSS community?

Whether you realize the fact or not, when you introduce FOSS into your business, you are entering into a relationship with the community that builds it. Moreover, your reputation within this community can be as crucial to your success as your relationships with formal business partners. You might want to think of your community relationships as public relations under a different name.

Even though FOSS developers often work for large corporations these days, much of the community remains suspicious of the motivations of any company involved with FOSS. For this reason, alleviation of this suspicion should be one of your first goals. Do not, for example, make the mistake of thinking that you can use FOSS for your own ends and not give anything back -- not only does the FOSS community consist of deeply intelligent people, but its members have seen such efforts at manipulation many times before.

Another way to ensure good relations with the community is to demonstrate that your company supports community ideals. The best way to demonstrate this support is to contribute free code, but almost as good is to imitate Google and sponsor events that aid the community, such as development sprints or conferences. Even the donation of a few thousand dollars is welcome in projects that are often short of funds.

By contrast, you want to avoid imitating Xara, the popular graphics editor, which initially received enthusiastic support for releasing the code for the GNU/Linux version of its flagship product, only to damn itself in the eyes of the community by abruptly deciding to keep core functionality of its software proprietary. The company looked both manipulative and deceitful, and its move into the FOSS market failed.

You should also be prepared to adopt the community behavioral norms. Don't expect automatic respect because of your business -- status in the FOSS community is based on contributions, and is earned over a period of months. Coordinating efforts over the Internet, the community also assumes the right of direct communication, so, while you may not want your CTO available to interact with the community, you should at least have your lead FOSS programmers available and active on community forums and IRC channels.

Don't forget, too, that, in the FOSS community, your business rivals may become sometime collaborators. You may still be trying to outmaneuver them in the marketplace, but, in the FOSS community, you may be working on code with them. You'll want to develop policies about how much you share, but this is one of those areas where business practice conflicts with FOSS ethics and behavior. Think of the community as a kind of neutral ground, where you can meet competitors and assist one another to your mutual advantage.

Finding other resources

These questions are by no means exhaustive -- you could write an entire book on any one of them. However, if you start by answering these questions, you should be well on your way to a productive relationship with FOSS and its communities, to say nothing of a successful business.

One place to go for more detailed answers is The Linux Foundation, a non-profit consortium of FOSS companies. The employer of Linus Torvalds, the Linux Foundation's members consist of most of the major companies involved in FOSS, including Hewlett-Packard, IBM, Intel, Novell, Oracle, and Red Hat. Your developers may be interested in its various work groups for collaboration on programming issues, while your managers may find its Collaboration Forum a useful place to learn more about FOSS issues.

Another useful resource is the annual LinuxWorld Conference and Expo. Although less useful than it was five years ago, when it was held twice yearly and had more participation from community projects, LinuxWorld remains a major event for FOSS business. Just walking the trade fair can be an education, but don't forget the seminars and birds of a feather session that take place at the same time.

The O'Reilly Open Source Convention can be equally useful, although it tends to be oriented more toward IT staff than executives.

However, by far the most useful resource for further education is the community itself. If you try to follow the precepts I've described, you won't be running a traditional business -- but you may very well be running a successful one.

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