Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

The incompatibility of open core and profit

bytesdataaction.substack.com

Post reply on HN
Print view View original

91–98 of 98 posts

Re: The incompatibility of open core and profit

#91

Post by imiric »

burakemir wrote: post #77
klabb3 wrote: post #70

Earlier quoted context omitted.

TLDR?

Attempt at a summary (a very good talk!): 1. Open source produces immense value and ironically locks itself out of capturing the value. In the last 20 years, open source has become the oxygen of software development. Cloud providers do what proprietary software vendors did 20 years ago. 2. "IP is free, support for $$" like Red hat is a viable business model but captures only a very small part of the overall value. Th…

I don't see any alternatives to open core there(?). Points 1 and 3 just mention the usual problems with OSS, not solutions.

> "IP is free, support for $$" like Red hat is a viable business model but captures only a very small part of the overall value. The much larger part is captured by private sector selling SaaS, Cloud infra vendors.

Isn't this the value captured by open core? Support is only part of premium services, while companies are free to choose any additional revenue stream (SaaS, extensions, integrations, etc.).

Re: The incompatibility of open core and profit

#92

Post by infogulch »

The big question here is how to construe the relationships between these parties:

    1. The company that is the original and primary developer of a product's source code
    2. Users, either a) other companies, or b) an individual using the product personally
    3. Competitors that would use the source code to sell an identical product
To have a chance of maintaining a sustainable community you typically exclude 3, and 2 pays 1 (modulo segmentation/whitelabeling). The problem is users don't want to give any one developer complete power over their systems and their knowledge to be used as leverage against them, so they want some compensation that guarantees this doesn't happen. I'd say this is the basic market economics-oriented reason why Free/Libre Open Source Software (FLOSS) and Open Source licenses exist; its purpose is to be that compensation and guarantee that freedom.

The problem is that the design of Open Source licenses have over-corrected and resulted in communities that are unsustainable and unable to bring software up to the level of fit and finish that users have come to expect from closed-source products whose lock-in could be leveraged to exploit users.

Open Core doesn't work because it yanks the incentives out of alignment and by construction causes a conflict of purpose.

I suspect a MariaDB Business Source License (BSL)-style license [1] is probably the best tradeoff for a company and community relationship. The basic idea is to start as one type of source available license, and then after a period of time the license of parts of the code 'decay' into a second, typically more libre license. This pushes the company to continuously innovate so their license is worth the cost, and if the company goes totally sideways users are assured that they can pick up the pieces after some fixed delay. Time is the correct dimension in which to solve this problem.

[1]: https://mariadb.com/bsl11/

Re: The incompatibility of open core and profit

#93

Post by burakemir »

imiric wrote: post #91
burakemir wrote: post #77

Earlier quoted context omitted.

Attempt at a summary (a very good talk!): 1. Open source produces immense value and ironically locks itself out of capturing the value. In the last 20 years, open source has become the oxygen of software development. Cloud providers do what proprietary software vendors did 20 years ago. 2. "IP is free, support for $$" like Red hat is a viable business model but captures only a very small part of the overall value. Th…

I don't see any alternatives to open core there(?). Points 1 and 3 just mention the usual problems with OSS, not solutions. > "IP is free, support for $$" like Red hat is a viable business model but captures only a very small part of the overall value. The much larger part is captured by private sector selling SaaS, Cloud infra vendors. Isn't this the value captured by open core? Support is only part of premium servi…

I also think that the talk can be seen as suggesting that open core is the preferable way to make a living from OSS - as long as openness is preserved (service implementations can be exchanged, client can pull out their data etc).

My interpretation of why the talk was mentioned as an argument contra open core: - the talk does have criticism for value extraction that does not preserve openness (as the OP says: promises of interop etc are not kept, lock-in... is it really meaningfully "open"?), and that it is not necessarily sustainable or fair for OSS developers ("who pays the postgres committers"). This latter point certainly gets more nuanced for open core, but can still be relevant e.g. when you depend on some library you are interested in its being maintained, having security vulnerabilities identified and patched etc.

Re: The incompatibility of open core and profit

#94

Post by sidPhoenix17 »

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'…

> WordPress is very easy to use, Automattic builds it, but they are not the only ones to make money from it, and I think the incentives are well-aligned.

It's interesting you mention this - Even Elastic started with this same model but then had some conflicts with Amazon being able to monetise ElasticSearch much more than Elastic themselves - so they eventually changed license and then Amazon forked into OpenSearch.. Here's the link for more context - https://www.elastic.co/blog/why-license-change-aws

Btw, wishing you best with your project!

Re: The incompatibility of open core and profit

#95

Post by worthless-trash »

worthless-trash wrote: post #51
throw_human wrote: post #46

Earlier quoted context omitted.

>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. People don't exist they are made up of cells. Humans don't run themselves: cells do. There is no such thing as a non-cell entity running humans.

> People don't exist they are made up of cells. > Humans don't run themselves: cells do. > There is no such thing as a non-cell entity running humans. Biology don't exist, they are made of atoms Cells dont run themselvs, atoms do. There is no such thing as a non atom entity running cells. We has a species have a hard time trusting atoms, they make up everything.

And they say HN has no sense of humour.

Re: The incompatibility of open core and profit

#96

Post by imtringued »

throw_human wrote: post #81
yuhaa98 wrote: post #60

Earlier quoted context omitted.

Now let's say somebody in a corp uses the software for some minor task. Are they allowed? Is it the person or the corp "using" it? If the latter, let's say me and my buddy both use the software individually, legally. We sit in the same room. Ok? We are together working on some non-profit project not involving the software. Ok? Now we use the software for it. Ok? Niw we make a profit. Ok? Where do you draw the line? R…

> Now let's say somebody in a corp uses the software for some minor task. Are they allowed? Is it the person or the corp "using" it? Not allowed. >If the latter, let's say me and my buddy both use the software individually, legally. We sit in the same room. Ok? We are together working on some non-profit project not involving the software. Ok? Now we use the software for it. Ok? Niw we make a profit. Ok? All allowed.…

>RMS has failed catastrophically in his goal of letting users have access to the source code of the applications they use. I don't really care for what he has to say

I don't know how you can say that unless you have impossibly high standards. If it wasn't for the GPL, Intel and AMD would have had zero incentive to opensource their drivers. NVIDIA and arm drivers are still proprietary but panfrost is in development. In an alternative timeline it is plausible that none of this would have happened.

Re: The incompatibility of open core and profit

#97

Post by imtringued »

ahepp wrote: post #64
blakeburch wrote: post #58

Earlier quoted context omitted.

Just want to clarify - I do not think we have the solution to this problem nor do I claim that cloud services are not open source enough. Rather, I decided to take one (of many) possible avenues that I believe is more upfront and honest about our relationship with open source that directly aligns with our business incentives. The difference to me is honesty and intent from the outset. Open core companies tend to lean…

After thinking some more, if what you're saying mostly boils down to "there are serious issues with open core cloud offerings" then I agree. I work on embedded products, so for my purposes open core usually means "you're getting free beer, but you might not get free updates". We've also paid for commercial licenses of dual-licensed projects and I think that model works pretty well. Once we're talking about services,…

>Once we're talking about services, if you're not willing or able to operate the service yourself (at the scale you need...) then the open core seems pretty useless as a check on the company's ability to squeeze you for more cash.

But if you aren't willing, then the service provides value and if you aren't able to, then there is the conflict of interest in that the opencore company might sabotage scaling the opensource version but if we ignore that possibility (after all, you should simply avoid the product, if the opensource version is inferior) then you are again paying for the value of someone else taking care of your problems.

Calling this "squeezing" is strange.

Re: The incompatibility of open core and profit

#98

Post by mathstuf »

pxc wrote: post #63
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…

> Open core is the only way to really monetize open-source software. Red Hat has built a business on free software without resorting to open core. Why can't anyone else (according to you)?

Kitware has as well. The vast majority of the work done is open. There are, however, customer-specific builds for some things, but typically only "special sauce" stuff is specific to those builds and is much closer to "customer purchased development of a specific plugin" than anything like open core.

FD: Kitware employee

Post reply on HN