Open source as the villain in its own story

After all, if the code is free and visible why should an enterprise customer write a check to its sponsor? (Buy this guy now, while he's on sale, from Buycostume.com. I'll explain why in a minute.)

When code has a BSD-type license, like Eclipse, the answer is that the project isn't producing products at all, but the raw material for products. Companies are free to write, and sell, proprietary extensions.

When code has a GPL license, the answer is not so clear. Companies may feel that their own code contributions, or help with bug fixes and beta testing, are compensation enough.

Savio Rodrigues of Infoworld (and IBM) divides customers by time and money, suggesting that holding some code back as an incentive for conversion makes sense.

Matt Asay of C|Net (and Alfresco) suggests the big money is in peripheral services, like systems management or SaaS, so the core need not be hidden.

To complicate matters further we have the fears of Twitter, a proprietary site whose functions could easily be cloned into a more powerful, networked open source project.

In other words this question of opening or closing code to maximize profit is no longer unique to open source. When open source is seen as a potential competitor it hits everyone.

This may be the key point. As a successful business model, open source is putting new competitive pressures on companies which are not all economic.

The goodwill of a powerful community can be a great asset, but like this site's credibility it's an asset that can disappear in a heartbeat.

Ask the folks at CoreCodec, trying to contain a PR storm over an action they've already taken back.

Reputation, credibility, and goodwill have no place on a public company balance sheet, but these values are just as important to software companies now as they are to politicians.

To Matt, Savio and others in the business the question is how much gold they can spin this straw into. But the wise man knows it's how much straw you have which really determines your bottom line.

In journalism we have a word for this straw. We call it credibility. It's hard to win, easy to lose. Every journalist worth their byline knows it's the only real asset we have.

So welcome to my world, boys. How the straw becomes gold may appear to be magic, but the straw is what you need to focus on. That's why the fellow at the top of the page is the villain in his own story.