Sustainable Business Model of Open Source Software!

How to make a sustainable business model & monetize open source product where most people are not willing to pay for privacy & transparency?

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make the core functionality free and lock features behind a paywall like

  • Proton
  • Bitwarden
  • Cryptomator
  • Standard Notes

and most important make a good product look and feel attracts different types of users if it looks and feel like it was made in 2010 for phones and 1990 for desktop you’ll mainly attract people that say things like “all software should be free, free as in libre and not price” but in reality they mean the price (not everyone who says that thinks like that but many do) and if its modern looking and feels snappy you attract a very big crowd of people > more people > more “premium” user

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What many open source companies do is offer their software as a service. A good example of this is Bitwarden where you are free to take it and host it yourself. But if you don’t want to do that, then you also have the option to use the software hosted by the company on their own servers. On top of that you can also charge for support. A good example of that is what Nextcloud does.

Another thing I’ve seen is release the source code but charge for the binaries. In that case the user is paying for the convenience of not having to compile the software themselves each time there is a new version. Cryptomator for example has a mobile app which requires you to purchase a license in order to use. The app itself is open source so you could modify the source code to remove that requirement and compile it yourself. But doing this each time there is a new version is a massive pain and most people would just opt for the $15 one time fee.

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The answer is to make a good product that can compete, (including monetarily) with all other similar products on the market. Almost no one in their own sane mind would prefer to spend more on a product with poorer qualities compared to other, unless they’re forced to.

Unfortunately, majority of the folks don’t value the FOSSness of a product and are not ready to pay for it for the sake of it, and it is totally understandable. FOSSness doesn’t provide additional functionality or feel, rather it is a message, a statement, an idea, a testament of trustworthiness and dedication. But it isn’t worth much if the product doesn’t satisfy the needs of users.

And the devs are very hesitant about making good, robust and competitive FOSS products, because these, much like usual closed-source, need many initial investments, but without a guarantee of payback and reliable business model.

There are successful FOSS products, but the FOSSness is not their main asset.

That’s the reality of the free market economy. If you don’t present something valuable, people don’t pay you. FOSSness alone is not enough. The way to a successful business model for FOSS products is to make people value FOSSness and it’s ideas. The way to make people value FOSSness is to advocate for it.

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I’m curious about @thecodrr’s and @vishnukvmd’s take on this post (and any other monetized open source ppl)

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I agree with the comments here.

With Ente, to ensure sustainability we simply don’t offer forever free plans.

This was a decision we took early on because when it comes to trusting your photos with a company, you’d be looking at one that can outlive you. So to us durability is the most important attribute, and taking this route has given us slow, but sustainable growth.

That said, there’s a sweet spot to freemium offerings where it could drive enough growth to ensure sustainability (where your paid customers subsidize your free ones). We haven’t found that spot yet.

Also, the business model of enabling self hosting and charging for support only works in the context of B2B software. For consumer apps, open-source and privacy can only serve as ancillary features (or marketing vectors) to an otherwise great product.

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