Chapter 2: What Good is Free Software?

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Book Chapter

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Brookings Institution Press




When you use the World Wide Web, it is likely that the web pages are sent to you by software that was developed by unpaid volunteers. The majority of web servers on the public Internet use an open source software program called Apache.1 This free product was developed by a loosely organized team of hundreds of programmers and thousands of other people reporting bugs or requesting enhancements, none of whom were paid by the Apache group for their efforts.2 Yet Apache competes successfully with well-funded commercial products developed by Microsoft, Sun, and other companies.

This seems paradoxical in an age when conventional wisdom holds that markets driven purely by private interest best serve collective needs. But I argue here that the paradox has a straightforward explanation. Although some developers of open source software are indeed motivated by altruism, many are members of communities that benefit from the development of software along very flexible lines. In particular, firms driven by the conventional profit motive find open source software valuable because it allows them to meet their specific idiosyncratic needs—needs not easily met with standardized software products. I argue that for complex software products these unmet needs constitute a major source of demand, providing a robust long-term economic foundation for open source software.

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