In an age where the open source ideology is gaining popularity, it makes me wonder: is profitable software useless?
It appears that when you look at which software is profitable, it's not the software itself which generates revenue, but the resources it requires around it.
Let's examine the Sublime text editor. The price used to be 70$ for a single license. It was worth it to a lot of people for several reasons; the tool did a great job. Unfortunately the only thing going for Sublime was that it was first-to-market with a few novel ideas, most notably multiple cursor editing.
Today multiple cursor editing is a common feature in many open source text editors. Since the barrier of entry to an open source text editor is having an Internet connection, their adoption easily surpasses Sublime's usage.
Thus Sublime is no longer profitable.
The open source editors are useful, and well, open source. Any paid-for extensions for these editors will eventually be replaced by open source extensions. The only thing making software profitable in this case scenario is first-to-market, and being a monopoly for a certain time.
So essentially open source software makes software non-profitable.
Ok well, what about something like GitLab? Where there is a free-tier and paid-tier?
Well what about it? GitLab is going to end up with the same fate. Actually GitLab has made it easier to crush themselves since the code is open source. It just takes one person to start adding in GitLab premium features in a fork. At least Sublime had a lead time by keeping its source code closed.
Ultimately what I conclude as profitable, is offering resources. Software is not a resource. A shovel is a resource because you need to make many of them. Software is a factory for which anyone can make things with.
GitHub and GitLab will remain profitable for the resources they offer, i.e. hosting, and not their software. Google is profitable for the data it offers (from the data it collects, which sits in its massive storage), not its searching program.
Let's extend this thinking into the open hardware realm. If all hardware is open, that means everyone has the ability to become a factory. Open hardware itself is not profitable; it's the resources you offer to create the hardware which is. The metals, management, distribution, etc, is what has value.
This leads me to conclude that all profitable business ends up grounded in reality rather than the virtual world.
Microsoft Word was profitable because it turned your computer into a word processor, or Microsoft Excel to turn it into a spreadsheet calculator. The issue is open source software turns these profitable closed source programs into non-profitable, non-extensible, non-updateable binaries. They are useless when compared to open source variants.
Considering all the above, I think it's obvious how to make a profitable "software" business. Don't focus on the software; focus on the resources.
It appears that when you look at which software is profitable, it's not the software itself which generates revenue, but the resources it requires around it.
Let's examine the Sublime text editor. The price used to be 70$ for a single license. It was worth it to a lot of people for several reasons; the tool did a great job. Unfortunately the only thing going for Sublime was that it was first-to-market with a few novel ideas, most notably multiple cursor editing.
Today multiple cursor editing is a common feature in many open source text editors. Since the barrier of entry to an open source text editor is having an Internet connection, their adoption easily surpasses Sublime's usage.
Thus Sublime is no longer profitable.
The open source editors are useful, and well, open source. Any paid-for extensions for these editors will eventually be replaced by open source extensions. The only thing making software profitable in this case scenario is first-to-market, and being a monopoly for a certain time.
So essentially open source software makes software non-profitable.
Ok well, what about something like GitLab? Where there is a free-tier and paid-tier?
Well what about it? GitLab is going to end up with the same fate. Actually GitLab has made it easier to crush themselves since the code is open source. It just takes one person to start adding in GitLab premium features in a fork. At least Sublime had a lead time by keeping its source code closed.
Ultimately what I conclude as profitable, is offering resources. Software is not a resource. A shovel is a resource because you need to make many of them. Software is a factory for which anyone can make things with.
GitHub and GitLab will remain profitable for the resources they offer, i.e. hosting, and not their software. Google is profitable for the data it offers (from the data it collects, which sits in its massive storage), not its searching program.
Let's extend this thinking into the open hardware realm. If all hardware is open, that means everyone has the ability to become a factory. Open hardware itself is not profitable; it's the resources you offer to create the hardware which is. The metals, management, distribution, etc, is what has value.
This leads me to conclude that all profitable business ends up grounded in reality rather than the virtual world.
Microsoft Word was profitable because it turned your computer into a word processor, or Microsoft Excel to turn it into a spreadsheet calculator. The issue is open source software turns these profitable closed source programs into non-profitable, non-extensible, non-updateable binaries. They are useless when compared to open source variants.
Considering all the above, I think it's obvious how to make a profitable "software" business. Don't focus on the software; focus on the resources.
Argh! Here we are six years later and everything you said has come to pass. Proprietary software hasn't disappeared, though, it just has given up any pretense of trying to compete on quality. It is a terrible mess of ill-conceived "features" (do you really want advertisements builtin to your operating system?). I have to help neighbors constantly who are stuck paying rent on "cloud" subscriptions to Microsoft, Apple, and Google. Worst of all, our hardware devices are getting locked down so that we cannot choose open source solutions. This is the year Google has said they will "improve" Android so that open source repositories like F-Droid will no longer work. And then, we look at who's doing the programming on the proprietary side, all the big companies have been in a mad rush to use LLMs despite unpromising and sometimes downright terrible results. Quality doesn't matter since they make money by controlling the most important resource: The Users.
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