economics of Free software

B

I just can't understand the economics of free software. I mean how can companies like WinAmp, Opera and LimeWire sustain themselves and hire people when they sell their software for free... I mean they should be bankrupt by now.. I don't think people ever buy the PRO versions of these softwares so how do they make big bucks??

the same way as linux or google

A

I also want to know. Especially about linux

any p2p gets money by advertise and their ultra versions. and as for winamp, there is too a pro version. google gets money thru various sources like adwords, adsense, ads plus the software they built(google earth pro)

linux spread its version coz they want to expand their community not thru money but by its unique features

I also want to know that how open source community survives when all their softwares are free.

~Phenom~ said:
I also want to know that how open source community survives when all their softwares are free.

When programmers can read, redistribute, and modify the source code for a piece of software, the software evolves. People improve it, people adapt it, people fix bugs. And this can happen at a speed that, if one is used to the slow pace of conventional software development.

B

I know Google makes money through advertising, but when it comes to WinAmp and the likes, I don't think many people upgrade to the PRO version. I know that Open Source Code evolves over time, but why do people spend their time and energy on making such software which they give for free and can't get any money from??

A

things are still not clear

bazigaar_no_1 said:
I don't think many people upgrade to the PRO version. I know that Open Source Code evolves over time, but why do people spend their time and energy on making such software which they give for free and can't get any money from??

there r thousands of people who want to support open source programme. if u make a s/w and want to spread it, will u add a tag of 10$ or will u keep it free????! i know winamp is used worldwide but they dont care for money.

check this link from gnu project *www.gnu.org/philosophy/why-free.html

ashisharya said:
When programmers can read, redistribute, and modify the source code for a piece of software, the software evolves. People improve it, people adapt it, people fix bugs. And this can happen at a speed that, if one is used to the slow pace of conventional software development.

I wanna know how they earn their butter n bread.

A

gary4gar said:
check this link from gnu project *www.gnu.org/philosophy/why-free.html

I can't read and understand this much.

Please someone post the summary.

I am not very much for open source myself. As far as I can gather, ppl make money not directly by selling the software, but indirectly by packaging, customer support, specialized implementation (or flavors, pro versions, enterprise editions, addons, plugins, expansions), special hardware integrating the software (like the google search server or something), consultancy, customizing, media distribution (!) etc.

It's not extremely profitable as all these things can proceed with any commercial software. But as long as the benefits (not necessarily, but including, money) outweighs the cost, open source wins (or some philosophical stuff).

M

Also by participating in programming Open Source software they earn a name and reputation for themselves which can get them into big software companies. Also good softwares increase their reputation amongst peers. Many projects get donations from big companies.
And quite a few Open Source software are sold for money.

~Phenom~ said:
I also want to know that how open source community survives when all their softwares are free.

Now one thing we need to understand very clearly here is the definition of the term "Open Source Community" ..

Not only does it involve big corporations like Mandriva & Redhat but it also involves the common Linux user and programmer ..

A majority of the Open Source community does not consider Open Source as a money making scheme . In fact , it's more of a source for deriving satisfaction from what they do .

How do we survive ?

Well , I'm an engineering student . I survive because my parents give me food to eat twice every day ( though , I admit I eat more than that ..

) .

Someone else may be working in a banking firm , but as a passtime and as a hobby the guy may be developing Open Source applications ..

So , the point is - we survive

Now , Open Source also enjoys the support of significant donations which contributes towards it's rise ..
For example , Redhat sponsored the Fedora Project and now , we have 5 major versions of the Fedora Core operating system .

We had a long discussion on this in old phpBB Digit forum. It went on for 5-6 pages. I can't find in now. Must have been deleted now.

But in short, the difference in economic status of Richard Stallman and Bill Gates really illustrate the economics involved in "Free" software (freeware and freedomware) and proprietory ones. They both are geniuses in their own rights and could compete with each other remarkably well if its all about knowledge and innovation.

ok . now I got some idea.
Thanx.

I saw some donation begging lines on Ubuntu website......
Have a look at this page at Ubuntu.com which asks fr donation!

*www.ubuntu.com/donations?highlight=(Donate)

M

yes AFAIK every free project asks for donations. And people are ready to give them too. And why not? These people are doing something good for others.

B

okay, I understood how they earn their money, but...
1) is the open source industry running on bank employees who code software in their pasttime?
2) if you don't expect any money except a few donations, who in their right mind would join the Open Source industry..??

Don't think Linux doesn't make any profit. You are wrong. They sell Linux O.S to
corporate and charge for it. Also most Linux distros have a free version &
commercial version. They get money from there & also from donations from
individuals or organisations.

M

And open source applications, mostly are not developed by just one person solely working day and night on the project. It is done in patches by 100's or 1000's of developers who spend little time and effort. It works on basis of united we stand.
So, these people do a little bit now and then with joint efforts.
Therefore they have all the time in the world to do their jobs and look after their family.

tech_your_future said:
Therefore they have all the time in the world to do their jobs and look after their family.

That sums up the economics of freeware and freedomware! You need another source of income to survive!

Why would anyone give away quality free software?

One of the most common reasons why quality software is given away is to introduce people to a company's product. A free version is given away, in the hopes people will like the product so much that they will pay to upgrade to the version of the software that has additional features. Of course, if the free version was not very good quality, this plan would not work. Another variation of this marketing technique is giving away free software to simply attract people to the website, where they will see the other products that the company has to offer. The better the freeware, the more web traffic will be generated – the result is free advertising!

The second most common reason that free software is available is due to the fact that there are programmers who believe in the idea that software should be free. These programmers band together to volunteer their time to develop products that are then made available for all to use. On occasion, some of these products were originally commercial products that were unable to compete with similar products that had the overwhelming majority of the market. These commercial products were then made “open source” and the volunteers continued to enhance and develop the product. An example of this is the alternative browser Mozilla, which is originally derived from the commercial Netscape browser.

Another reason that people give away quality software is that they wrote the program for their own use and then realized that others would find it useful as well. Whether they generously decided to simply give it away, or did not have the time to spend trying to market the software themselves, the result is the same: very useful free software available for anyone willing to download that gives capabilities not available elsewhere. When someone goes to the trouble of writing a program, it is because there is a need for it. A good example of this is the unique free program that makes a breeze to see how the files on a computer's hard drive are using up the disk space, thereby enabling the computer's owner to remove unneeded, space consuming files. There is no easy way at all to do this with the software that comes with the computer.

Sometimes people write software in order to gain something else besides money. Freeware is given away because the author may want to establish himself in the Internet community as a serious and capable programmer. Others ask that they receive something in return, such as a postcard or an email, because they enjoy seeing where their software is being used all over the world. There were also programs that were written as a project in a college class, for example, and then made available to all when the class was completed. Some free computer games came into existence that way.

One type of freeware that turns up occasionally is when a program was originally written as a commercial product. This program might be very well written, but was not a financial success, which can happen for a variety of reasons not related to the quality of the software (inadequate funding, for example). There are some particularly good games that fall into this category. At some point, the owners of the program decided to simply make it available for all to enjoy at no cost.

source : *www.iwantfreeware.com/

bazigaar_no_1 said:
okay, I understood how they earn their money, but...
1) is the open source industry running on bank employees who code software in their pasttime?
2) if you don't expect any money except a few donations, who in their right mind would join the Open Source industry..??

It is abundantly clear that it was an illustration .
The point to be understood was that the "Opensource Community" does NOT entirely consist of people who go to their offices every day and sit coding Opensource programs and get paid for it .
There exist enthusiastic people who prioritise self satisfaction ahead of big bucks .

FOSS ( Free and Open Source Software ) is all about quality and freedom of usage - If you like a software you are using , you may express your gratitude by monetary means .
( Unlike closed source , where every product is highly monopolised )

So , all the people who join the Open Source industry are people belive in the principle of FOSS .
They think about the collective good of the computing world than the good of some selfish money-minded individuals .

Don't misunderstand me though , I'm not painting a philanthropic picture of Open Source , I'm simply stating the basic principles underlying the term .