Open Sources 2.0/Foreword: Source Is Everything
The software industry has always been caught between two perspectives: one anchored in supply, the other in demand. To the market's supply side (the vendors), commodities and "commoditization" have always been threats. To the demand side (the customers), commodities have always been useful.
The latter view is winning, thanks to open source. And we're only beginning to discover how much larger the market will be, now that it's filling with useful open source commodities. These commodities, in most cases, have little or no sale value, but are useful for building countless other businesses. The combined revenues of those businesses will far exceed revenues of companies that make their money selling software.
Use value precedes sale value in every market category. Think about it. Agriculture started with gardening. Textiles started with weaving and knitting. Meat packing started with herding. Construction started with hut building.
What did the software industry start with? In a word, programming. As Eric S. Raymond said in the first chapter of the original Open Sources, "In the beginning were the Real Programmers." To Raymond, real programming was both legacy and destiny—a source that began with "guys in polyester shirts, writing in machine and assembler and FORTRAN," and ran through Unix programming and the free software movement, to arrive at "Linux development and mainstreaming of the Internet."
That latter phrase captured where the industry was when Open Sources was published in January 1999. The Internet, Raymond noted, "has even brought hacker culture to the beginnings of mainstream respectability and political clout."
A half-decade later, open source has grown far beyond the mainstream. It has become the bedrock over which the mainstream flows. Today it is hard to find a Fortune 500 company with an IT infrastructure that does not depend, in some fundamental way, on open source software.
The Internet mainstreamed programming by putting every programmer zero distance from every other programmer in the world. Supported by this extreme convenience the demand side began supplying itself in a global way. "Real Programmers" were back in power. This time, however, real programmers were a legion, not a mere handful, and the tools they needed could be found on any PC, not just on the infrastructure inside large organizations.
Today power comes from everybody who creates anything that's useful to anybody—and that any other programmer can improve.
Today there are hundreds of thousands of hackers, perhaps millions. Whatever the number, many more will soon arrive from Asia, South America, Africa, and other formerly Net-less places all over the world.
The technology sector's industrial age—the one in which manufacturers built platforms for silos in which customers and users were trapped—will, in retrospect, appear to be an early growing stage: a necessary but temporary step toward a healthy and mature marketplace.
Let's give credit where it's due: developing software and hardware in the early days of the computing industry was like settling Mars. Every company had to build its own airtight habitat, from the ground up. Making hardware and compatible software inside your own habitat was hard enough. Trying to become interoperable with anybody else's environment was nearly unthinkable. Even within large companies like IBM, whole systems were incompatible with whole other systems. Remember Systems 34, 36, and 38, which used twin-ax cabling while IBM mainframes used co-ax?
All these closed habitats naturally fell in to fighting. The press supported the battling-vendor view of the marketplace, which became a form of entertainment, dramatized via continuous coverage of the vendor wars.
The Net obviates the need to build closed habitats. You don't need to make your own bedrock anymore. Open source commodities provide all the base infrastructural building materials you need, and then some.
Naturally, the old supply side felt threatened by that. For a while.
Then the demand side (the programmers) inside those silos began using open source to build solutions to all kinds of problems. Today IBM, Novell, HP, Sun—nearly every big platform and silo company other than Microsoft—have shifted their product strategies to take advantage of abundant open source commodities in the marketplace. They also contribute, in most cases, to the development projects that continue to produce those commodities. While the decisions to "go open source" were made at the tops of those companies, in every case they also involved ratification of decisions already made by the companies' own engineers.
You can still build platforms today, of course, but for practical considerations, it only makes sense to build them on top of open source infrastructure. Amazon and Google are familiar platform businesses (one for retailing, the other for advertising), built on cheap or free open source building materials.
The portfolio of open source building materials now runs to 100,000 or more products, each the project of a hacker or community of hackers, each producing goods, the primary purpose of which is to be useful, not just to sell. Because that software is useful, and most of it doesn't have a proprietary agenda, whole market categories can be opened where once only proprietary platforms and silos grew.
Take the private branch exchange (PBX) telephone business. In the old days, which are now starting to end, companies had to choose corporate phone systems from Toshiba, Panasonic, NEC, Nortel, and other manufacturers of closed proprietary platforms and silos. Then a small device maker, Digium, released Asterisk, an open source PBX. In addition to a vigorous development community, Asterisk attracted countless varieties of businesses made possible by its wide-open use value. In the long run, far more money will surely be made because of Asterisk than could ever have been made by selling Asterisk—or even by selling the proprietary PBXes that Asterisk now obsoletes.
So, thanks to open source, the software market is finally growing up. It is becoming mature. Its healthy new ecosystem is made possible by countless commodities, growing more numerous every day.
There is an important difference, however, between open source commodities and those derived from raw materials (like wood or steel) that is harvested or mined. It's a difference that will make the new, mature, software marketplace incalculably large.
The difference is this: open source commodities are produced by creative and resourceful human minds. Not by geology, biology, and botany. This means there is neither a limit to the number of open source products, nor a limit to the number of improvements.
Yet every one of those open source projects is concerned mostly with the improvement of their own products. While they care about how those products interoperate with other products, they can't begin to account for all the combined possibilities where interoperation is required. That means there is room for businesses to test, certify, and support combinations of open source products.
That's what attracted me into the vast and growing new marketplace opened by a growing abundance of open source building materials. Like many industry veterans, I didn't see that opportunity until I moved my point of view from the supply side that felt threatened to the demand side that felt empowered.
And I'm hardly alone.
Some will say we're at the beginning of another boom—or worse, another bubble. Those views are both limited and misleading. Open source has changed the world of software into one in which raw materials are literally limitless. Every mature industry—such as construction, automobiles, computing hardware—has experienced hyper-accelerated growth resulting from commoditization of its core building blocks. But the impact on the software industry has the potential to be far more profound, because software is so malleable, so easily shared now, and so increasingly ubiquitous in everyday life.
So, while open source software, and the commoditization it brings to the software industry, may seem a threat today, it is actually ushering in a wave of enormous innovation and productivity—the impact of which has already reached far beyond this industry.
It comes down to one simple truth: we humans naturally desire to improve our own world through building useful tools. In sharing those tools, we've learned that the world around us gets better too. So the idea of open source is as old as civilization itself. And our very modern industry is finally realizing the power contained in this simple fact: the first source for everything we make is ourselves.
—Kim Polese, CEO, SpikeSource