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Why Open Source Failed

Money” by Andrew Magill CC-BY

2018 is the 20th anniversary of the term “open source”, and a good number of articles have been written and conference talks given about this landmark year, the vast majority of which have been of the self-congratulatory, navel gazing type. Unfortunately, open source proponents seem unable or unwilling to tread into reflective contemplation about the actual impact open source has had on society at large, resulting in a rather large blind spot. I’m afraid, dear reader, that the world has left it to me, the guy who brought you such hits as “There is no Open Source Community” and “It Was Never About Innovation”, to tell you about the gross failure of open source as a mechanism to unlock a more equitable society and why we all need to be better. We may not be entirely responsible for either the problem or the solution, but we’re certainly complicit and, thus, responsible for helping to resolve the issues.

First, the good news, which is actually bad. In a 2016 survey from Blackduck, 96% of software products developed that year used open source software. That number is likely higher now. In the software world, particularly software that runs the computing infrastructure of the internet, open source is ubiquitous. One could claim, without any exaggeration, that our current world runs on open source software or that our modern world would not exist in its current form without open source software. I don’t know how to calculate the total value of open source software to the world, but I do know that if open source software suddenly went away, the results would be catastrophic, an existential crisis for humanity. So when I write that “open source has failed” I’m obviously not writing from a technology perspective, where it was been a clear-cut winner and the foundation of an endless supply of business models, products, and services. To say that open source contributed to the overall innovation of the world would be a shameful understatement. Better would be to say that the world’s computing innovations owe their existence to the triumph of open source development. If you think this all sounds pretty terrific, read on to find out what I left out.

Amusing sidebar: it is, in fact, only due to the sheer, abject stupidity of a not-insignificant number of technology executives and venture capitalists that open source software isn’t even more successful. You’ll still hear VC’s repeat, with utmost sincerity, that releasing open source software cuts a startup’s valuation by 10%. It is only through luck that VCs have not been quicker to catch on to the strong connection between open source development and rapacious capitalism. I say that as someone who has built a career out of convincing companies to use open source platforms as a means of growing large ecosystems in order to establish and maintain hegemony over various industry segments. It is a testament to my terrible salesmanship that more companies haven’t followed my advice. In some technology circles, you will still get a whiff of “open source is communist”, which incites a bemused reaction from me. These are usually the same people who swear that nobody in their company uses open source, when in fact, all of their teams require it.

In the context of this essay, “failure” refers not to any technical achievements but rather to the lack of social ones. When we were but wee lads and lasses on the forefront of this thing we called free software and eventually open source, we knew that this was dangerous stuff. It was destined to set fire to an entire industry, undermining entrenched monopoly powers and establishing a more equitable approach to building wealth around the tools that would power humanity in the 21st century. It was about the democratization of software and would smash what we then called the “digital divide”. That premise was entirely false. The crux of this essay is thus: not only did open source not stem or stall the redistribution of wealth and power upwards, but rather it aided and abetted the redistribution of wealth and power upwards. To be an open source proponent at this time without acknowledging this very real and most unfortunate consequence is to be a cog in a much larger machine; a stooge; a very useful idiot.

When considering the role of open source in redistributing wealth upwards, it’s instructive to consider the example of Microsoft. Not because I enjoy picking on them or think they’re evil — I don’t; Microsoft as a publicly traded company is no more or less evil than any other company. Rather, I like to single them out because their public stance towards open source has changed much over the years and is a useful measuring stick for the points I’m trying to make. Did you ever wonder *why* their public stance towards open source shifted so much over the years, from “Linux is a cancer” to “use our open source software”? Could it be because, unlike the company’s predecessors in 2000, current executives now understand that open source software forms the building blocks of modern capitalist behemoths?

Consider the cases of these companies forming the base of what we now call “big tech”, all of which are darlings of wall street: Amazon, Google, Facebook, and yes, Microsoft. We’ll address the first 3 first, leaving Microsoft to the end, because it’s a special case. What do the 1st three have in common? They all built their entire business model on open source software, and they have paid very little in license fees to software vendors. That’s their secret. They all applied the lesson very early on that the way you build profitable businesses is to start with a foundation of open source software, hire a team of smart engineers, and build your way to glory. And that’s precisely what all of them have done.

Microsoft, having taken some time to come around to this position, recognized the error of their ways once they tried to build their cloud computing business, Azure. At one time, they may have entertained the idea of building this business entirely on their Windows platform, but they very quickly learned that the best way to capture the same margins as their competitors and take advantage of the economies of scale in cloud computing was to use as much open source as possible, even if it meant that many of their customers would be running Linux variants.

The problem is compounded by the fact that you can build proprietary services using open source software. The software you use is shared, but the applications and services you built don’t have to be, especially if you’re conveying the software over a web site. Even that most notorious of “Communist” licenses often cited by paranoid executives as examples of anti-commercial aspects of open source, the GNU GPL version 2 or 3, is useless when it comes to prying open web applications written by Facebook, Google, Microsoft and Amazon. And let’s not forget how some of these very same vendors infiltrated the process of creating the GPL version 3, undermining the community and cutting off efforts to close the “web app loophole”. How they did that was an under-reported story from 2006–2007.

So what, you may ask, does this have to do with redistributing wealth upwards? In each case, they have created businesses that make vast sums of money, there are tightly constrained groups of employees who benefit, and they tend not to pay others for software. The money comes in, but it never leaves the Hotel California of cloud computing. This means that the highly paid professionals of these companies, and their management, receive the lions’ share of money, forming a part of the 10% of earners leaving everyone beyond. Before open source proliferation, when companies usually had to pay something for every line of software, that income was at least distributed through many parts of the economy, resulting in less concentration of wealth.

And then I read these tweets from Christopher Mims of the Wall Street Journal, which were the inspiration for this essay:

As noted by Mims, these graphs track pretty closely with the separation between wages and productivity: “Almost all of the increase in income inequality from 1978 to the present can be accounted for by the difference in wages between top performing firms and everyone else.” That 2nd chart is especially telling, because “their own, proprietary software and other IT/technology” refers specifically to things built with open source software. Perhaps not in the beginning (the 2nd chart starts in the mid-80's), but certainly since the early 2000’s.

Think about that — the most successful way to amass ridiculous sums of money and keep it to yourself is to build your business on open source software. During the time in which large companies have amassed fortunes with open source software, the wealth gap has continued to widen, and fewer independent software developers are paid directly for their work. This statement is slightly controversial, because it’s quite easy for open source developers to find work, often high-paying. However, that work is often in the context of making products for your employer, which you do not own the intellectual property of. Employers love to pay expert open source developers, as long they give up their intellectual property claims. Most developers, open source and otherwise, are quite happy with this arrangement. After all, who cares what happens to 90% of the people if you’re firmly ensconced within the top 10, 5, or even 1% of earners and never have to look for work again.

Which brings me to intellectual property law in general. The dream of open source software, as advanced by its advocates, was that democratization of software would result in shared ownership of its intellectual property. After all, if no one owns software, then everyone owns it. Unfortunately, this failed to take into account patent law and software. A developer may apply for a patent — and get it — but the owner of that patent is the employer who paid the attorney to write the patent application. The same with copyright. The company (employer) often owns the copyright and their developers write code under the employer’s copyright (not always — some companies are better than others). Employees have very few rights in these matters once they leave their employers, whether or not they write open source or proprietary software. Sure, they can cite their patents in the future, but that patent stays with their employer. This failure strikes at the very essence of open source’s raison d’etre. If the proliferation of open source software cannot begin to resolve our issues with concentration of wealth in the technology industry, and in fact exacerbates it, then what good is it?

One could argue that there is nothing intrinsically wrong with any of this — that this is simply how markets work and is one of the consequences of a capitalist economy. If we lived in a time where extraordinary companies had difficulty putting distance between themselves and competitors, I would argue similarly. But in fact we live in a world where the polar opposite is true. A very few large companies have been able to establish concentrated bubbles of wealth and power that continue to grow at an astounding rate. These companies have learned how to use intellectual property laws to remove competitive threats and establish choke holds over their particular industry segments. This is alarming on many levels, but there are 2 that most concern me: 1. fat, lazy, wealthy companies don’t really innovate very much and 2. high concentrations of wealth and power are breeding grounds of class resentment and divisive politics. #1 is largely theoretical at this point, but #2 has come true beyond any autocrat’s wildest dreams. That open source software has become a building block for #2 should give us all concern.

What Next?

One of the most vocal proponents of intellectual property reform has been economist Dean Baker. He has argued forcefully that our current system of granting monopolies under patent law and other forms of intellectual property has directly resulted in the hoarding of wealth. Unfortunately, there has been a decided lack of enthusiasm by open source-friendly companies to tackle or confront our intellectual property laws. This is shameful, although one can understand why — it’s simply not in their financial interest to do so. (sidebar: why isn’t Dean Baker on every open source conference’s short list for keynotes?)

It’s time to understand something about open source software development: it is not going to save us. Using or developing more open source software is not going to improve anyone’s lives. Developing open source software is not a public good. It’s not going to result in a fairer or more equitable society. In fact, as currently structured, open source development is part of the problem. If you work for one of the companies that stands in the way of intellectual property reform, and you say nothing in protest, then you are part of the problem. So many open source developers and advocates are gainfully employed and at very little risk of losing future work prospects, and yet I see so few speak out about their employers’ role in wealth inequality.

It’s time to demand better. It’s time to demand fairer markets as regulated by governments. It’s time we demanded that our employers not contribute to the problem. It’s time we considered that better regulations around open source usage and dissemination are probably a good thing, in so far as they can be designed to reduce wealth gaps and lead to more equitable societies. Reforming patent and copyright laws would be a good start. Reforming employee ownership of patents and intellectual property would be another. Mandating that web applications follow open source practices and allow more competition would be wonderful. Mandating that government agencies only use services that don’t lead to further consolidation of wealth from proprietary services would be a feather in the cap. Until then, the proliferation of open source is synonymous with the further concentration of wealth and redistribution of wealth upwards. To ignore this is to engage in the most willful of ignorance that harms others. Once you come to the realization that you are part of the problem, as I have over the past few years, you must act to help resolve it. Contact your representatives and senators and start voicing opposition to those companies that are complicit.