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The incompatibility of open core and profit

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Re: The incompatibility of open core and profit

#31

Post by wokwokwok »

armchairhacker wrote: post #20

Open core is the only way to really monetize open-source software. You see this issue with core-js, you see it with mold linker, which went "open core" in a desperate attempt to get more funding. At the end of the day we must remember that people need to make money and most simply don't have the time or desire to make open-source for free. And until more people actually get adequately paid for making open-source, ope…

> until more people actually get adequately paid for making open-source, open core should not only be tolerated but encouraged

Come on, did you actually read the article or skim the first paragraphs?

The authors point is that open core is not a model that enables small time developers to fund their projects.

…it’s a deceptive, deliberate marketing strategy funded by venture capital to run a loss leader and capture market share, then bait-and-switch to a cloud hosted product.

It’s been shown to be successful, and new companies are cynically adopting it as “free marketing”.

Even when the initial ideals are honest, the model is fundamentally incompatible with running a for-profit enterprise due to obvious (and explicitly pointed out in the article) misaligned incentives.

Don’t encourage it. It’s deceitful. If you’re doing it, you’re being a dick. :(

Being honest from the beginning as per the examples at the end of the article are what we should encourage.

Re: The incompatibility of open core and profit

#32

Post by josephcsible »

Entinel wrote: post #22
josephcsible wrote: post #18

Earlier quoted context omitted.

> There is an incompability between FOSS and profit Red Hat says hi.

Red Hat uses a very similar business model providing managed enterprise features on top of open source.

What software programs or features does Red Hat not make available under a FOSS license?

Re: The incompatibility of open core and profit

#33

Post by throw_human »

kgodey wrote: post #27

I've been thinking about this problem a lot, since I'm trying to figure out how to sustain our open source project. Our project is complex enough that it requires a few full-time people to maintain it. Our current funding comes from a grant, which is not sustainable in the long term. I'm philosophically opposed to open core because tying revenue to proprietary features seems like the wrong incentive structure, I can'…

The best I've been able to come up is that freedom 0 applies only to humans. If a non-human entity is running the software, viz. some sort of corporation, then it is not allowed to without a (expensive) license.

I want to make the world better for people, not for Amazon.

Re: The incompatibility of open core and profit

#34

Post by sneak »

throw_human wrote: post #33
kgodey wrote: post #27

I've been thinking about this problem a lot, since I'm trying to figure out how to sustain our open source project. Our project is complex enough that it requires a few full-time people to maintain it. Our current funding comes from a grant, which is not sustainable in the long term. I'm philosophically opposed to open core because tying revenue to proprietary features seems like the wrong incentive structure, I can'…

The best I've been able to come up is that freedom 0 applies only to humans. If a non-human entity is running the software, viz. some sort of corporation, then it is not allowed to without a (expensive) license. I want to make the world better for people, not for Amazon.

Corporations don't exist. Amazon is made of people: shareholders and staff.

Software doesn't run itself and corporations don't run software: human beings do.

There's no such thing as a non-human entity running software.

Re: The incompatibility of open core and profit

#35

Post by revskill »

api wrote: post #14

How do you give people a product that maximizes freedom and privacy without going bankrupt? It seems like the only way to make money in this industry is to strategically cripple your product or exploit your users in some way. It’s deeply dysfunctional and twisted. I can’t do my best work and make a living. I have to create something that is worse in some way than what I could create or nobody will pay for it.

The worse part is, marketing said: We are the best.

The issue is having something to do with real transparency. It's underrated.

Re: The incompatibility of open core and profit

#36

Post by musesum »

Seems like a tradeoff between fixed assets versus variable assets. Writing code that doesn't change for years is a fixed asset. UX is a fixed asset. Somewhat like the construction cost of putting up a building. Maintaining the code and data is a variable asset. Somewhat like maintaining the building. Variable costs scale with the number of users.

With OSS, fixed assets are often overvalued. All of the R&D to get the UX and algorithms working well is easily copied. So, monetization relies on variable costs. Frequent updates. Data hosting. Ironically, buggy and obscure code helps monetization.

I almost became a developer of a successful database product. I attended one of their conferences. That's when I learned that the company made half of its money from consulting. It rammed home a joke I heard from an employee at Lotus Development: job security through obscurity. I left the conference dissuaded.

I recall a game developer had a deferred software release. You could download last year's game engine. But, to have access to the current engine (and thus influence its direction), you had to pay.

Re: The incompatibility of open core and profit

#37

Post by [deleted] »

sneak wrote: post #34
throw_human wrote: post #33

Earlier quoted context omitted.

The best I've been able to come up is that freedom 0 applies only to humans. If a non-human entity is running the software, viz. some sort of corporation, then it is not allowed to without a (expensive) license. I want to make the world better for people, not for Amazon.

Corporations don't exist. Amazon is made of people: shareholders and staff. Software doesn't run itself and corporations don't run software: human beings do. There's no such thing as a non-human entity running software.

[deleted]

Re: The incompatibility of open core and profit

#38

Post by mattigames »

sneak wrote: post #34
throw_human wrote: post #33

Earlier quoted context omitted.

The best I've been able to come up is that freedom 0 applies only to humans. If a non-human entity is running the software, viz. some sort of corporation, then it is not allowed to without a (expensive) license. I want to make the world better for people, not for Amazon.

Corporations don't exist. Amazon is made of people: shareholders and staff. Software doesn't run itself and corporations don't run software: human beings do. There's no such thing as a non-human entity running software.

From his/her wording I assume they mean some unspecified threshold before a group of people is considered a corporation. From my limited understanding I think it could be useful to have a license that is only for free for organizations made of (for example) 10 people or less.

Re: The incompatibility of open core and profit

#39

Post by ilyt »

dasil003 wrote: post #8
ilyt wrote: post #6

Sooo what is says is that Open Core goals are mostly to get your users hooked under pretense the software is "open source", while putting just enough features behind the proprietary part that you have no choice using it once your product grows ?

Yes, but that read is a bit cynical. I think it's totally reasonable to create some tool that any college student or tinkerer can use to get a cool idea off the ground, but also want to get paid when it's leveraged to significant financial success. Pure open source is nice, but in practice it means corporate sponsorship or ramen lifestyle, both of which, it seems to me, have worse downsides than the loss of ideologic…

Right but on contribution side it basically taking unpaid labour then selling it to their paid customers. That part I have problem with.

And you don't need open source model if you just want to give smaller might-be-a-customer a free, limited version.

I guess it depends on what exactly is behind the paywall. Some have very weird limits, like Mattermost where you can use Gitlab for authorization in open core but for LDAP you need enterprise.

We actually paid for it and were pretty happy with it but at some point they decided to double the price under excuse "but we added features"(that we did not use) to that version. So one Rails dev added a dummy "gitlab" oauth page for auth that's connected to our LDAP and we just switched to open core version...

...aand since then they doubled the price again. So suffice to say I'm a bit soured on open core model, when they tried to upsell us to more than we pay for O365 account for same features.

I'm not saying it's all bad, for example VictoriaMetrics looks like it have very reasonable model (although lack of pricing on their page is... annoying), but it is model ripe for abuse, especially if company gets bought.

Re: The incompatibility of open core and profit

#40

Post by MoOmer »

throw_human wrote: post #33
kgodey wrote: post #27

I've been thinking about this problem a lot, since I'm trying to figure out how to sustain our open source project. Our project is complex enough that it requires a few full-time people to maintain it. Our current funding comes from a grant, which is not sustainable in the long term. I'm philosophically opposed to open core because tying revenue to proprietary features seems like the wrong incentive structure, I can'…

The best I've been able to come up is that freedom 0 applies only to humans. If a non-human entity is running the software, viz. some sort of corporation, then it is not allowed to without a (expensive) license. I want to make the world better for people, not for Amazon.

I’m a fan of the Sustainable Use license [0] for this reason, for some projects!

[0]: https://docs.n8n.io/choose-n8n/faircode-license/

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