The Promise and Challenge of Fair Source Licensing

Anchoring Principal

However, one of the challenges of a purely open-source model is that many assume it is a cost-free solution and, as such, it has no value for them to pay for. This assumption, known as the anchoring effect, can lead to the misconception that open-source software should always be free, which can hinder the sustainability of compelling software.

Sentry developer Armin Ronacher addresses this issue on his blog, arguing across several posts for the value of a hybrid approach to open-source development.

Large businesses with correspondingly large bank balances should assume that they will have to incentivize the building of the solutions that power modern tech stacks. That means it’s vital that any license communicates who can use the software for free, who will have to pay, and in what amount.

Open Core Split Priorities

One way that open-source projects try to raise enough money to pay the bills is by adopting an open core model. In this pattern, the core product is given away for free, but some parts businesses need are kept closed-source. This results in a split of priorities for open-source developers and companies, as the developers may prioritize the open-source aspect, while the company may focus on the proprietary tool to generate revenue.

The way I have seen this play out most often is that some group of developers releases a new open-source project that’s new and exciting while working for a company. However, not everyone has the knowledge and understanding to use or configure the latest software. So, the company employing the open-source developers will create a tool that makes the open-source project easy to use or integrate with others. From then on, the open-source community and the company sponsoring the project will have different priorities.

The community wants open-source to be easy to use and full-featured. They want everything to be free and easy to access. While they usually don’t contribute the majority of the code, they still expect to have free and easy-to-change access forever.

The company needs to be able to pay bills, so it wants as many sales of the tool as possible. To do this, there needs to be some differentiation between the open-source solution and the open-source solution combined with the proprietary tool. The company is incentivised to keep open-source hard to use and complex, while any large changes to open-source are potential revenue losses.

This split makes it difficult for everyone to move forward in the long term. Instead, the projects become enterprise zombies, hard to kill, and everyone is afraid to be too close.

Open Source Sustainability

In “The Life and Death of Open Source Companies,” Ronacher highlights the challenges of open-source businesses. He tells the story of Josef Prusa, a developer of open-source 3D printing software and 3D printing hardware. His main competitor, Bambu Labs, is larger, better financed, and (most importantly) building its hardware on Josef’s open software.

Because of this, Prusa is openly reconsidering his fully open-sourced approach to development because it lacks sustainability.

As Ronacher writes:

“…building a true Open Source company is hard. Under the OSI definition of open source, you are put at a massive disadvantage as you are prevented from putting protections in place that shield you from other competitors in that place who chose not to play by the same rules but can leverage your source.”

The world is starting to understand that, eventually, successful open-source projects need to pay more developers than the free price tag allows. This forces costs to be raised unexpectedly for open-source users and is seen as a rug pull or trick.