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How do you make money with Open Source?

The short answer is: Services

That is a question I get asked all the time. And quite rightly so. After all, without the license model and the source code being out in the open, free for everybody to download and do with it whatever they want – where is the actual product? And how do you make money with it?

Sourcefabric has been in the open source business for years. We started out in journalism and radio, developing two tools called Newscoop and Airtime. We then started the development of Superdesk, catering to the more complex needs of newsrooms, with the idea of “create once, publish everywhere” at heart. What that means is multi-channel publishing of quality content to a variety of devices. Sound familiar, publishers?

Then along came Booktype and all of a sudden we (Sourcefabric) were also in the book publishing industry. At the same time news organisations were starting to look at the book format to republish their already existing content, radio stations started to publish non-audio content and traditional “written word publishers” started producing podcasts. Book publishers were right in the middle of trying to make sense of the relationship between books and ebooks – a conversation not too dissimilar from the problematic marriage of print and online journalism.

Sourcefabric has been working with existing content producers all over the world for years. We have a lot of expertise and a number of cool toys. But seriously – how do we pay our bills? The simple answer is this: Services.

All our tools are free and open source and available for download and for repurposing by others. But not everybody has the technical skills or set-up to do that. Take Booktype for example. Some people might need secure hosting – we provide that service. Some people need support – we provide that. Some people need help developing extra features and functionalities – we can do that. And some organisations (publishers and print on demand services, for example) might need integration into existing workflows – we sure can do that too! When things get a little more complex, we work with clients on a thorough needs and workflow analysis, then we create a project spec with proposal and budget.

A very important point is that we can do all that and we love doing it. But if you would rather work with other developers, it is up to you who you want to work with. The source code is accessible for others, which means other developers can download our tools and get right to the heart of them too. And as bizarre as that might sound, we are totally happy for that to happen. In fact, we actively endorse it. Of course, as the initial creators of the tools, we would like to think we are the best (and hence your best choice) at working with our own tools, but the more people want to work with our software and the more people that have the ability and a vested interest in developing additional functionality, the better for us too. It keeps us on our toes to keep producing the best possible solutions. And because we are in it for the long haul, that means creating a vibrant ecosystem with many active participants. One benefit for users is simply that even if Sourcefabric were to stop actively working on a certain tool, its future is not at all endangered by that move.

The idea of an ecosystem is also important in light of the license question and the overall quality of the tool. Because although the licenses our tools are published under free the user from any payments for usage, the licenses (in the case of Booktype this is AGPL)  include an obligation on the user’s part to share any extensions or improvements so they can be brought back to the source code. That means that the tool gets better the more people use it. Imagine just 20 organisations are using Booktype, all with complementing needs (workflow, input / output formats, you name it). Each organization simply has to commission one improvement but can in fact make use of all new functionalities. Now, don’t tell me that’s not a good thing?!

And at this point, I will take a direct stab at licensed software – all the money you pay for licenses simply gets you the usage rights for a limited time. If you invest even half of that in open source development, you not only get the product as it is, but you can benefit from customisations that some licensed tools simply do not allow. You have a lot more flexibility and you can really save a lot of money by going open source.

Things can of course go even further than that. An integration of Booktype can have transformative effects on a client’s workflow and sometimes even on the business model. In those situations, we work with our clients on much deeper analyses, we might even build certain prototypes, we train the teams and we create documentation. And in most cases, we provide ongoing support on a very personal level. When the technology we develop plays a crucial part in somebody else’s business, a personal and close relationship is key to ongoing success. The more we can get under the skin of an organisation, find out about the people and traditions within it – stuff that has on first glance nothing to do with technology at all – the better we can respond to that. Sometimes that means technological solutions, sometimes that means something else. And thanks to our vast expertise across many sectors, industries and countries, we can bring some truly innovative and compelling ideas to the table.

So that’s how we pay our bills right now. The future for open source technology in innovative businesses is looking bright and exciting. We are also talking to other companies about joint ventures, we are regularly being asked (and paid) to present our expertise at conferences around the world. But all that only works if we are really good at what we do! And we are.

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