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Effective Open Source Business Models

Open Source Business Models

The idea of building your business around open source software is not as risky as it might seem. It is the outcome of the freedoms that you gain when you use open-source software. The best feature of open source software is the unhindered ability to create. In other words, the innovation and creativity that open source business models offer are the attestations of the authenticity of its use.

Open source projects do not directly start the business rather they contribute to the growth of the businesses. This article will help you to build a business around open source. Given below are a few successful models to consider.

Support and services

Red Hat is one example that selling open source software can be a great advantage to your business. Like Canonical, its software does not charge and gives enterprise users technical support services for free. Similarly, Red Hat also gives premium services, Red Hat Enterprise Linux which is attractive to the users because of its rigorous testing and stability. As a result, the company can sell enterprise software certification which gives employers the ability to find highly skilled IT professionals who are certified by Red Hat and have presented proficiency with Red Hat software tools.

Advertisement partnerships

Mozilla’s open-source projects get reinvestment back into them once they start generating the earnings. The Mozilla Corporation is a for-profit subsidiary of the nonprofit Mozilla Foundation. It produces its revenue from partnerships with companies such as Yahoo, Google, and Amazon. These platforms pay Mozilla to become a built-in search option for Firefox browsers.

In 2014 Yahoo paid $375 million annually to make it a default search engine in Firefox. Similarly, the company pays AdBlock plus, which is an open-source ad-blocking extension, to not have their ads blocked by the plugin.

Paid additional features

MySQL gives enterprise-oriented premium features that are not part of the basic software version. It also gives support services. Similarly, Oracle-owned Company which is described as the world’s most popular open-source database offers downloadable software as well as three enterprise versions with annual subscriptions ranging from $2,000 to $10,000. In these subscriptions, there is a tier of certain additional features that are not usually available for free and an open-source version might be useful for enterprise use.

The open-source software gives companies an opportunity to earn money by selling a cloud-based software-as-a-service. WordPress.com is one such example of a model as it is an open-source content management system (CMS) which is hosted on the webserver, whereas WordPress.com is also one of the privately held hosting services that run using WordPress CMS. This service is also very handy for non-technical users who want to run their websites based on blogs and article writings. Many websites are able to establish themselves without the intricacies of installing the WordPress CMS. It doesn’t require to be located and configure web hosting. Its success earned Automattic, the company behind it, a valuation of over $ 1 billion in 2014.

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Last Modified: November 11, 2020 at 12:16 pm


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