Tuesday, July 8, 2008

Does Open Source Matter ?

Does open source matter ?? does it matter to you and me or is it just for the geeks and evangelists....

Open source term originated from the mouth of geeks when some people like you and I started saying that the programming code should be open. Unlike other brick and mortar industries, software was unique in itself. You could sell software but the keep the source code to yourself. Whereas in other industries, the moment you sell a product you inadvertently sell the source too. Anybody can dismantle the product and know the source or technology. That's how the term, 'Open Source' came into limelight.

When Henry Ford made the car for the first time, he thought he would be the only one selling all the cars ever in future. He didn't realise that with the car, he was also selling the source code. Very soon, people learnt the technology and started making better cars and in many colors. Similarly in other industries, companies sell the source code without realising it. Another classic example is Coca-Cola. They knew right from the beginning, the composition of the soda water that they sold was crucial to their business. They never divulged the details of their secret formula to make coke. They did realise that sooner or later anybody can produce the same drink with same taste as the drink is a tangible product. They built a huge wall of being the world's most famous brand which was difficult to emulate.

When software industry evolved, people thought that they would be better off keeping the source code to themselves and sell the product. With the intangible nature of the product, it made sense too. Few years down the line, some people were quick to figure out that if they made the source code open, it not only led to the betterment of the product very quickly but also made it more robust and secure as more eyes could catch more bugs. With the statistics from Coverty, a software defect analysis company, the average defect in open source software is much lower than proprietary software. This way, open source made the difference to the software industry.

If we analyse other industries in the world, most of them have open source hidden in them in some form or the other. Either they are industries based on open source or very soon they would be. Now the question is how the companies have managed to keep it proprietary. What is good for everyone - proprietary or open source. Let analyse some of the industries.

Education is considered as the most noble business. Educational institutes are coveted the most. Even though the top institutions have produced so many intellectuals over centuries, education still remains one of the most protected proprietary products. The source code is not open. MIT was the first institution to make its courseware open for all. I don't see any reason why Harvard Business School should have a closed courseware. Why can't everyone benefit from what intellectuals teach at Harvard. Why HBS has to sell its case studies when it has millions of dollars in its corpus fund. Is the premier institute afraid that they would lose the competitive advantage by opening up their system. If it is so, how is it different from Microsoft.

Encylopedia may be or may be not aka Wikipedia, is another classic example of David - open source challenging closed source - Golaith. In early 1990's, Microsoft and other companies came up with a concept of selling encyclopedia in 6 cd's of voluminous data. To many, it appeared to be the most profitable idea until it was all of sudden made look silly by Wikipedia, an open source initiative. The success of wikipedia heralded a new era of open source content. The same company has also started its sister websites named Wikibooks, Wikiversity and many more. Many professors in top universities have already started putting up their classes in the form of webcasts, podcasts, wiki and e-books. Are we turning to open source in education.

Automobile Industry, one of the most popular old economy businesses, has always kept their source code open. Not because they wanted it, but because they had the limitation that they could not keep it closed. With the recent research in the hybrid and greener vehicles, Toyota spearheaded the concept of being open source evangelist in the research for greener technology for automobiles. On the other hand, Honda is betting on closed source approach by keeping their research proprietary. Only the time will tell, which approach is more beneficial for the company and the consumers.

Media industry is not too far from being affected by open source revolution. Hollywood studios which were so adept in protecting the media rights and making billions of dollars are having tough time dealing with emerging technologies. These technologies of peer-to-peer sharing, video sharing and online streaming have made it almost impossible to protect their media copyrights. The only way to fight out this threat for them is to go open source. Take out all the copyright protection elements and make it free over the net. They will have to think of newer sources of revenues other than traditional sources of revenues. Youtube is already changing the traditional way of internet surfing. Porn media houses have been shattered with video sharing websites sprawling all over the place. It has changed the way business was done.

Retail sector
is the only one that is farthest from the impact from open source. The only open source thing that touches the retail sector is ebay. It started with a great idea of providing online marketplace for the people selling and buying all over the place. It not only granted the buyers the power of buying at their quoted prices but also gave them the power to rate the sellers. It stills is far away from being open source concept.

My mind fails to see the open source future trend in retail. If anyone can see that trend, please let me know. This is the beauty of open source in blog that you can contribute to my ideas and enhance it for the next reader.

There are many more industries where open source is not very clearly visible. It, definitely, is one of the forces which is changing the economies and business.
It is changing the world, you and I see !!

I'll continue writing about open source and how does it matter .....