Cooperatives, Competition, Openness

I've been thinking, in light of the Oracle purchase of Sun Microsystems, about the role of big companies in our economy, the role of competition, and what open source business models look like. This is a huge mess of thoughts and trains but I have to start somewhere.

  • The Hacking Business Model isn't so much a business model, as it is an operations model for hacker-run business. In that light it's a quite useful document, and it's understandable that it mostly ignores how to obtain "revenue" (and therefore, I think, falls in to the trap that assumes that new technology creates value which translates into income, when that doesn't quite work pragmatically.)

I'm interested in seeing where this kind of thing goes, particularly in the following directions:

  • Where does capital come from in these systems? For start-up costs?
  • Where and how do non-technical (administrative, management, support, business development) staff/projects fit into these sorts of systems?
  • The conventional wisdom in proprietary software (and to a lesser extent in free software) is that in order to develop new technology and improve existing technology code-bases need to compete with each other, and I don't really think that this is the case in open environments.

I'm not sure that the competition between Solaris, the BSDs, and Linux (augmented as they all are by GNU to various extents) pushes each UNIX/UNIX-like operating system to improve. Similarly, I don't know that having vim and emacs around keeps pushing the development of the text-editor domain.

At the same time, competition does help regulate--after a fashion--the proprietary market. Having Oracle's database products around help keep Microsoft's database products on their toes. OS X spurs development in Windows (usually). Without serious competition we get things like the ribbon interface to Microsoft Office (ugg), and telecoms.

This ties into my work and thinking on distributed version control systems, but I think in open systems, (particularly where branching is supported and encouraged,) the competition can happen among a team or with one's own history. We pitting code bases against each other seems to not make a great deal of economic sense.

  • I wish I had access to demographic data, but I suspect that there are few if any open source projects with development communities that are bigger than ~100-150 dunbar'snumber, and the bigger projects (eg. Drupal, KDE, GNOME, the Linux Kernel, Fedora, Debian) solve this by dividing into smaller working projects under a larger umbrella.

And yet, our culture supports the formation of companies that are many many times this big.

I've written before about the challenges of authenticity in economic activity, and I wonder if having large non-cooperative institutions (companies) is one of the chief sources of in-authenticity is the fact that we can't remain accountable and connected to the gestalt of the most basic economic unit (the corporation).

I wonder if as we learn from free software and open practices, if cooperative-based business are more likely to become more predominant, or how else our markets and economies will change.

This brings us back to the revenue system in the hacking business model from above. In smaller operations we can imagine that some business opportunities would be viable that wouldn't be viable in larger operations. Also, because smaller co-ops can specialize more effectively. These factors combine to signify that competition becomes an internal or "vertical" issue rather than an external/horizontal project and in these situations generating revenue becomes easier.

Thoughts?

More to come?

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