Ask Slashdot: Open Vs. Closed-Source For a Start-Up 325
atamagabakkaomae writes "Together with a friend, I am starting up a company in Japan that develops sensors used in motion capture. For these sensors we develop hardware and software. Part of the software development is an open-source toolkit called openMAT. We have some special purpose algorithms that we developed ourselves and that are better than our competitor's technology. I first wanted to publish everything open-source to spark interest in our company and to do development in collaboration with the community. My company partner disagreed and said that we will lose our technological advantage if we open-source it. So I eventually published only a part of the toolkit open-source and closed the most interesting code. How do you guys think that open-sourcing your code-base affects a company's business? Is it wrong for a small company to give away precious intellectual property like that or will it on the contrary help the development of the company?"
No need to help your competitors (Score:5, Insightful)
You believe you have better algorithms than the competition. Starting a company is hard enough without giving Christmas presents to the competition. Keep everything closed while the company is young and vulnerable. Open source your code later if it won't help the competition AND you believe it will add value to your company. How far would Google have progressed if they had open sourced their search engine ten minutes after they had it working?
Frankly, if you have to ask this question you aren't really serious about succeeding.
Your partner has a point (Score:5, Insightful)
Since you work in a very specific industry and not with something that has everyday uses for everyone or at least lots of people, open sourcing your code won't spark interest in your company or get you a community that helps you develop it. Less specialized software already doesn't get contributors, and if they do, it takes insane amount of time to look over the contributions. You work in a very niche industry - you won't get either one of these, but instead you will give away whatever advantage you have.
Now is not a good time to open source it. Maybe later if you grow to a large company, but not now. You will probably see most comments suggesting open sourcing it, but they are only saying so because of the community of slashdot. They aren't thinking it in business sense.
Re:No need to help your competitors (Score:5, Insightful)
Not a lot of open source companies making $$$ (Score:5, Insightful)
There are a few. Red Hat is a good sized company. Springsource had a reasonable-sized business (tens of millions in revenue) before being acquired by VMwware. mySQL was similar in revenue, and got acquired for crazy money by Sun. There's SugarCRM [sugarcrm.com]. But in general .. most of the really valuable companies have really valuable software they keep under lock and key.
Focus on the business. That's hard enough. (Score:5, Insightful)
Focus, focus, focus on getting that product out the door; that alone will take everything you've got. Open-sourcing involves managing a team of people who are distributed in geography and in time zones, and may not care about the mission of your business. It's way more headache than you need right now; I'd definitely not try to add that to your already-full plate.
Open-sourcing isn't really a marketing tool. Once you have a harem of happy customers, they will provide all the buzz you need, and then if you're profitable, you might have some breathing room to think about helping society.
Open source is good... (Score:5, Insightful)
Provided that you're selling something else. The reason we open source things is to give something back to the community; it helps us get our jobs done. But we don't give away our work.
Incidentally, I'm split on the issue. I happen to know a chip vendor that lost at least one contract because their development tools were proprietary; we instead developed with their competitor's FPGA because the tools provided were free.
But it sounds like your expertise is not in the HW, but the SW. Consider that your competition sounds like they're expertise is not in SW, but HW. With their better expertise in HW, they could probably use your algorithms to offer a better overall solution than you can, effectively shutting you out of the market.
Is it worth it? (Score:5, Insightful)
Consider:
- Is your product something that hobby developers might take an interest in? Will their contributions add value to your codebase or company? Will they want to contribute?
- Is your product something other companies might find useful if they took it, added a feature, and contributed it back to you? Will they have any incentive to send anything back to you?
- Do you have anything that you can subsequently sell to the people using your open code, that they are going to want to buy, that a competitor can't quickly spring up and take the opportunity from you?
- Could opening the code allow you to steal away a significant part of the market, that you can later sell products or services to, for a net profit? Is this likely?
And weigh this up against:
- You've given away the code. Is there anything left to sell, and will people want to buy it?
- Would your company survive if someone saw the code, thought it was a good idea, and put double the number of developers on it and told them: "make something like this"? Assume they will use your code as a reference, but no proof of it will ever be found.
- A company with an international presence steals your code, builds it into their product, and sells it. Do you either have the resources to fight a huge multinational (possibly hiding behind a subsidiary in a different country), and the ability to survive for a few years whilst it works its way through the courts, as well as fight off baseless countersuits? Or is your product such that your company will survive, even if it is being ripped off, possibly even benefiting from the exposure?
Re:No need to help your competitors (Score:5, Insightful)
The business power of Know How (Score:5, Insightful)
Tell your partner, that not only will you keep your technological advantage, but you will always be one step ahead of any competition if you work with a community. Be a leader for that community. Provide an infrastructure that makes communication easy among contributors. Inspire them by giving directions and accept input at the same time. Tell the community about your goals, let them be part of the story, inspire them to contribute and make yourself a desirable target for talent.
What you need is a clear focus on your business model. As an Open Source company you will market your know how, your unique expertise and tell everyone that you and only know are the ones to support a customers into the deepest abysses of technical problems. Find partners and share your expertise. Identify key contributors to the project and hire them. Be the experts in your field of knowledge and make yourself independent from a product that others can copy. Develop a business case, a sales pitch that potential customers will easily understand and identify as something that will bring a distinct advantage to their business by using your product.
One last thing: You will have lots more fun building an OSS company than going the closed way. You will be part of a community, you will lead it and you will continuously get input from intelligent people, input that otherwise will cost you dearly when hiring external consultants.
Heh (Score:3, Insightful)
Despite Richard Stallman's objections if he heard the same question*, open-source is not going to help in any way here. Your technology is what's known as a "trade secret", and would be the basis for whatever revenue your company makes. Giving out the algorithms to your competitors would be corporate suicide, and gain absolutely nothing except a reputation for being a total idiot.
Google open-sources things that it can afford to have open sourced, because it's to their benefit in various, interrelated ways. They're in the business of information after all, and whatever avenues they can make in obtaining said information are all the better.
* His first objection of course would be to first clarify the difference between free and open-source software, which I'm aware of but don't see the relevance in this particular case.
Closed source is more accountable (Score:1, Insightful)
Look at big open source projects, notice how unusable the user interfaces are or how buggy the code is (memory leaks everywhere) because there is no accountability and they can get away with saying "fork off". When your closed and have real money on the line you have to compete better or you go out of business.
Like it or not, billion dollar enterprises are closed for a reason and why open source users are stuck in their mom's basement.
Re:No need to help your competitors (Score:5, Insightful)
Note that he said he is in the hardware business; the software is just something extra.
I suspect that if they aren't competitive on the hardware, a few extra bits of binary-only software won't help. If other people manage to make better hardware at the same or lower price, they'll figure out how to make better software as well.
Patent it (Score:4, Insightful)
You have a third option here: patent the special purpose algorithms, then open source it under a license that does not include a patent grant. This way, your value-generating asset is protected, but your users still get some benefits of OSS - the ability to tinker with the code and adapt them to their needs, and knowledge that they can support it themselves in long term if need be.
If you want, you can also add an explicit patent grant for open source applications only (e.g. only for GPL v2 and v3). That way you get FOSS community onboard, but any commercial competitors would still have to license your patents (which you could refuse outright, or at least ask a fair price) to reuse the idea.
Re:Open Source (Almost) Everything (Score:4, Insightful)
But algorithms can't be patented, and the competition will have them shortly.
Plan the business model around the hardware, the first sentence did say:
I am starting up a company in Japan that develops sensors used in motion capture.
Embed the algorithms into the sensor if possible, but in any case make sure your sensors are better than the competition.
Hardware can be patented, and the software can be opensource. If someone else makes better software (and you get tired of the arms race)
you can fall back to selling just the hardware and actually service your competition with smarter better sensors.
Re:Open Source (Almost) Everything (Score:4, Insightful)
I'll chime in and say that if open source isn't a core part of your business plan, then why expend the time and money making your project open source? It costs you more to open source something than keeping the code to yourself _unless_ you have something compelling enough that people will want to help you with the code, which is very unlikely. Keep in mind that you can open source the code at any time, so the question is what is it compelling to you now to have it open source?
Re:No need to help your competitors (Score:5, Insightful)
Well but that's kind of a binary response. I think a hybrid approach serves the motion picture industry best.
*Keep your secret sauce secret!*
If you've developed something new and novel then open source isn't going to improve it you're just giving away the labors of your intellect. There is absolutely not benefit from giving away your recipe for success.
*Open source the rest!*
Your secret sauce if it's a mo-cap algorithm can return the tracking/skeletal data without giving away how you derived it from the RAW data. Make all of the translators, interfaces and UI open source. This is how most vfx studios prefer to receive their tools since they will inevitably want to customize it and work it into their pipeline.
If it's something that's been done 1,000 times and nobody does it better or worse then you only benefit from getting the community to help create your product. The community is great at uncreative and uninspired work. The community is not going to improve your novel motion capture algorithm.
Re:Not a lot of open source companies making $$$ (Score:5, Insightful)
Yeah, but those who make it mega-big (Facebook, Google, Oracle, IBM ..) all have their "crown jewels" close sourced. There is no equivalent monster company that is exclusively open source.
Re:No need to help your competitors (Score:3, Insightful)
Re:Is it worth it? (Score:4, Insightful)
There's actually one more point to consider along this line. When facing a well funded competitor, one thing that can happen is them patenting some aspect to what they do, one that is obvious and necessary for any similar design to function. One way you can block this is by releasing your version as open-source, serving as an undeniable bit of prior art. Killing competitors with patents is now the area unfair tech business competition is fighting hardest at. One reason I push out almost everything I do to the world is to keep someone else from patenting the ideas I come up with.
Even if your competitors do then take that idea and steal it, it's possible to make money from the fact that your version is always months ahead in innovations. It's easier for someone who is actively inventing ideas to keep the flow of research moving forward, compared to someone that who just copied a subset of their ideas.
Put it in the hardware (Score:5, Insightful)
Put the algorithm in the hardware if you can, then you can publish the library open source without any risks.
There is also the question of whether closed source will even protect the algorithm. Binaries can be disassembled and reverse engineered, so closing source just makes thing more difficult if it's something as simple as an algorithm you are trying to protect.
Re:Heh (Score:5, Insightful)
The difference is very relevant here. Stallman believes that developing closed source software is morally wrong, much the same way that some folks believe abortion is morally wrong. The Open Source "movement" believes that opening the source leads to technically superior software. Linus open-sourced Linux because he thought it would be more useful that way, not because he thought that he was doing something morally right.
The OP here apparently came to an agreement with his partner that they not open source the good parts of the code. His question about it being "wrong" to open source the "good stuff" seems to come from a moral perspective. From a moral perspective, I think he's on fine ground. If he's worrying about making the most money, it depends on what he considers his company to be. Are they are hardware shop first and a software shop second or is it the other way around? If it's the former, open source it all. If it's the latter, he should close everything up if money is the only issue at hand.
Ask Greenpeace: Nuclear or Solar (Score:5, Insightful)
I've done plenty of startup software development - we tend to use open tools and LGPL libraries, staying away from the pure GPL stuff because of the shades of green that the investors turn when they hear that they don't own secrets in the code.
If you go open (Score:2, Insightful)
And your competitors use your code (if it's not BSD or something similar), you've then forced them into being open, too.
Re:No need to help your competitors (Score:5, Insightful)
Are you trying to suggest that those of us that were here in the 90s wouldn't tell him to keep the secret sauce secret?
If so, I am here to tell you that you're wrong.
Re:worked for Sun, Netscape, and HP (Score:4, Insightful)
Mixed Open/Closed Source Models Are A Disaster (Score:5, Insightful)
You won't build any community among your customers if they feel locked out of key pieces of the product. If anything, they will be resentful. Jon Oosterhout tried it with TCL (Scriptics). Ransom Love tried it with OpenLinux (Caldera). Both failed.
You have already build your software on top of openMAT. If you want to be a closed-source company, then do the right thing - dump openMAT, and write your own replacement.
For what it's worth, in my opinion people are overly obsessed with the importance of protecting their precious "IP". You are not that smart. Any "edge" it gives you will only last a short time. It is more important that the products that you make do what you say they will do, that they are delivered on schedule, that they are reliable, that they are properly documented, and that you are available to stand behind them.
Re:No need to help your competitors (Score:2, Insightful)
Re:No need to help your competitors (Score:5, Insightful)
Frankly, if you have to ask this question you aren't really serious about succeeding.
I was with you right up until this bit. The arrogant presumption just drips off these words.
Re:No need to help your competitors (Score:5, Insightful)
Agree. Open source an API to use your hidden stuff. Someone will eventually reverse engineer your algorithms but hopefully by then you will have got past the survival stage and have progressed your work further.
Re:No need to help your competitors (Score:4, Insightful)
Releasing the source code 3 years later when the game as close to no commercial value is not what he meant at all.
Re:Important point (Score:3, Insightful)
Turn in your geek card. RMS failed at maintaining emacs (for some reason, people don't like working with him), and was forced to import the complete xemacs fork and rename it "emacs".
Same story with gcc and egcs.
RMS can't earn a living with "his" code, which is why he rambles around talking about how you too can be dirt poor via open source.
Only open source your codebase if you want to outsource your entire company and any future profits to your competitors.
Re:No need to help your competitors (Score:5, Insightful)
I think it really depends on how new the industry is. For example, in the robotics industry, Willow Garage open sourced the software they use to run their PR2 robot. The end result is that pretty much every robotics lab in the country is using their software... maybe even some of their competitors. Now, what does this mean for their bottom line? I'm not sure. But it does mean that more and more people are adopting their platform, and perhaps these labs will be buying a couple PR2 robots (at $500,000 a pop) sometime in the future. But Willow Garage can afford to do this because 1) robotics is a new industry and there are no monolithic players yet and 2) there are no stadards they have to dethrone. Might as well make your own software the defacto standard in that case.
So in that sense, if your customer base is small, and open sourcing will make your cusomter base want to use your product over a competitor who has closed source code, then it seems like a good idea to open source. If you're not targeting people who appreciate open source code (say, if you make accounting software or something) then there really is no compelling reason to.
Comment removed (Score:1, Insightful)
Re:No need to help your competitors (Score:4, Insightful)
The real question here is whether your secret sauce is actually secret or whether anyone is who is interested and capable can reproduce your secret sauce.
So keeping it secret unless you can patent the product provides you nothing except an minor possible effort gain upon your competitors. Competitors who only need to expend the effort to match the outcome.
Technically what you can do is not open source the code but publish it under copyright and achieve copyright protection on that code. Of course every other closed source company can simply cheat and steal that code keeping their code secret, which the already of course do with open source code.
Reality, don't count your chickens before they hatch, you product might have a better algorithm but lack in every other area, marketing, production, distribution, price competitiveness and lose. So you might consider what works out best for the people involved, would open sourced code work out as a good fall back for employment, market the people not the company.
Re:Important point (Score:4, Insightful)
Only open source your codebase if you want to outsource your entire company and any future profits to your competitors.
I think your criticism is valid, but your conclusion isn't. You should open source your code if you estimate that you will still be the driver of the development. Then, other companies will build up dependence on you, you will gain influence and importance.
How can you make sure you will still be the driver of the development?
a) You have skills and experience in your area and your codebase nobody else has and will have difficulties to develop. Then others will always rely on your work.
b) You continuously add value and innovate, so your codebase is the go-to point.
c) You outwork your competition with consistency. When their fork goes stale, people will abandon it.
The beauty of open sourcing is that keeping upstream with you (feature-wise) is extremely difficult for a competitor that has a separate closed-source codebase. This is only accelerated when other people add to your product (don't start with counting on that though).