Market Making for the Bazaar

Mr. Thompson presents a bold and innovative business model for paying developers to produce free software.

In “Making Money in the Bazaar” (June 1999), we raced across the landscape of current efforts to drive innovation and make a living in the Open Source market. We now introduce a system for consumer-driven Open Source funding. If successful, it could accelerate the pace of innovation even further and create a small industry around developing free software.

The Need

Is there some graphics hardware you wish Linux supported better? A game you wish was ported from Windows? Or possibly a GUI application to ease some parts of system setup?

If so, what do you do about it? If you are a developer, you can just write it. The Linux model has been “scratch your own itch” and contribute back to the community.

If you aren't a developer, don't have the time or the necessary skill—you're out of luck. You have to wait and hope that some other sufficiently motivated developer with the same need will take on the project.

This can be quite frustrating—you need that graphics driver now. You could speed things up by hiring someone to develop the software just for you. But paying a fortune to have a custom driver developed for a $50 graphics board just isn't feasible.

A larger group is needed to share the burden of developing a standard driver. Several thousand people in the world probably use that same graphics card and run Linux. Why don't some of them get together and share the cost of having the work done?

The same concepts apply to scripts, help files, applications—anywhere there is a demand for software.

A Buyer's Co-op for Open Source

The Internet is an amazing tool for bringing specialized communities together. A group of people needing the same software is just such a community.

The trick is to attract all of the interested parties to the same web site, where they can pool their resources with others wanting the same thing. This site must coordinate the process of gathering support, selecting a developer, evaluating the resulting software and collecting the funds to pay the developer.

The Free Software Bazaar

Interview with Axel Boldt

Axel Boldt's Free Software Bazaar was the first realization of these ideas. It opened in the fall of 1998; within six months, it collected over $25,000 US in offers and over $1200 in payments towards Open Source projects. The site works by letting users browse a list of existing offers. If a user is interested in sponsoring an existing project or creating a new one, they send e-mail to Axel. He then adds their offer to the listing page.

These offers can be claimed by the first developer to successfully complete the work. Axel then notifies the sponsors, asking them to send payment directly to the developer.

CoSource.com

The Free Software Bazaar is a great service to the Open Source community. However, a huge ongoing effort is required to maintain momentum and grow the movement into something powerful.

For cooperative funding to become a significant force in the Open Source market, the achievements of the Free Software Bazaar must be multiplied many times. Managing the demands of so many parties is a difficult problem. A cooperative funding service needs to be innovative in solving the confidence and communication problems between sponsors and developers. It should be convenient and simple. It must be professional and build a strong record of trust. In the end, it is essential to attract and maintain a critical mass of sponsors and developers.

CoSource.com is an attempt to create a service that meets these demands. It is a commercial enterprise created to provide the range of services required to make cooperative funding a success for buyers, developers and the Open Source community in general.

It intends to:

  • Publicize to better achieve a critical mass of sponsors and developers for each project.

  • Have staff work with corporations directly to encourage sponsorship and development of open source.

  • Provide VISA/MC/AMEX credit card processing to make payment convenient (especially for non-US sponsors).

  • Automate as much as possible with HTML forms and a database back-end.

  • Provide a stable web address and organization for long-running projects.

  • Foster trust between buyers and developers through simple, standard and legally binding on-line agreements.

  • Provide cash advances to developers with a proven track record when they begin work.

  • Provide web space to trumpet the financial contributions of corporations and individuals towards particular projects.

  • Prevent duplication of effort by having sponsors collectively hire a single developer to work on a project.

  • Allow sponsors to back out any time until a developer is finally selected.

  • Allow full control for sponsors to select the developer, development schedule, source code license, etc. that suits them.

If all these goals can be achieved, cooperative funding will provide effective answers to the questions, “How does one make a living on free software?” and “Who is motivated to innovate?”

The answers are that innovation is funded directly by users who pay for new features, which in turn supports a small army of independent software developers.

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