Business model for Open Source - advice wanted

[Graeme Matthew]

Im working on a commercial application for a company to replace their
existing system. In python of course. Our aim is to distribute it
commercially and if a large number of people upgrade then we are planning on
donating some funds to the applicable open source associations. I think that
if anyone is going to make a commercial product from open source then the
expected bare minimum is to at least offer something for all those involved.






"Frank Millman" <frank at chagford.com> wrote in message
news:246a4e07.0307100613.fc2fc50 at posting.google.com...
> Hi all
>
> I would like some advice, and I hope that the good people on c.l.p
> will give me the benefit of their experience.
>
> I am busy developing an accounting package, using Python and wxPython,
> together with PostgreSQL on a Unix platform or SQL Server on a Windows
> platform. I am a qualified accountant and have been developing
> accounting software, mostly customised, for over 20 years. I have now
> got myself into a position financially where I can take a few months
> off and write "the perfect system". No, not really, but I have built
> up a lot of experience over the years, I have a lot of ideas about
> what I would like to see in a system, and I have decided to give
> myself the opportunity to see how good a system I can actually write.
>
> At some point quite soon I will have to start generating some revenue
> from my efforts. I have a number of people interested in what I am
> doing, and I was planning to start selling it as YAAS (yet another
> accounting system) and see how many customers I could get.
>
> As an alternative, I have been toying with the idea of releasing it
> under an Open Source license. Part of my thinking is to put something
> back into the Open Source community - I love working with Python,
> wxPython, PostgreSQL, etc, and it would be nice to contribute
> something. The other part of my thinking is that it should be
> possible, with a sound business model, to make a viable income out of
> supporting an Open Source product. However, as I have no experience of
> this, I was wondering how other people survive financially in the Open
> Source world. I have no "big daddy" that will pay me to pursue my
> dreams, so whatever I do has to bring in a reasonable income.
>
> Here are some of my ideas - any comments will by much appreciated.
>
> The essence of a business model must be that the source code may be
> free, but you have to pay for support. I believe that accounting
> systems more than most systems need support, and that a sensible
> company looking for accounting software would not consider anything
> that was not supported. Therefore it is important to decide what kind
> of support should be offered, and how to persuade customers to sign up
> for it.
>
> The software must be downloadable and runnable by anyone, and it must
> be fully functional, at no charge. I realise that there is an option
> to restrict functionality in the free version and make it available
> only to licensed users, but then you are into security codes, source
> code protection, etc, which would at least partially defeat the
> object, so I am not thinking along those lines. There will be full
> online help (it will probably start off sketchy, but I will improve it
> over time), and maybe there should be an FAQ available. That, I think,
> is all that should be free.
>
> I would like to open a free discussion forum (probably a mailing list)
> to discuss the software from a technical perspective. I am an
> experienced programmer, but I am nowhere near being a Pythonista, so I
> am sure there will be many areas ripe for improvement. I would like to
> remain open to as much of this kind of feedback as possible.
>
> However, any support of the software from a business or accounting
> perspective will be available to registered users only. For a monthly
> support fee (I am thinking of a range of $50-100 per month - let me
> know if it is too high or too low) users will be able to request
> support via email, which will be responded to promptly. I have a small
> staff at present, and if this idea is successful I will plough money
> back into expanding the support infrastructure.
>
> To retain registered users once their software has settled down, I
> have in mind a website restricted to registered users which will
> provide sufficiently interesting content to persuade them to keep up
> their registration. The main content I can think of is enhancement
> requests - it is the nature of accounting software that there is a
> continuous demand for enhancements, and I intend to keep on enhancing
> and improving the product. I envisage a forum where users can forward
> ideas, and others can respond/comment/criticise until there is some
> consensus. A roadmap of agreed enhancements can be posted on the free
> website, which will hopefully attract more users into signing up so
> that they can participate.
>
> Here are a couple of pitfalls that I can see, and my possible
> solutions to them. Firstly, a user will be able to terminate his
> support contract at any time, and the software will continue to
> function. Therefore some may be tempted to stop paying until they have
> a problem, then pay for a month, get an answer, and stop again. My
> thinking is that 3 months must be paid up front to activate a support
> contract. Secondly, a consultant may use my software to build up a
> client base, pay a single support fee, and use that to support all his
> clients. I don't think I can (or even want to) prevent that, but I can
> restrict it by limiting each contract to a single email address for
> replies to support queries.
>
> These are my thoughts so far. Any comments - suggestions, warnings,
> personal experiences - will be much appreciated.
>
> Many thanks
>
> Frank Millman