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Open source as corporate joint venture

April 21, 2008

A new report from the Linux Foundation reveals the extent to which the most famous and successful open source software project - the development of the Linux operating system - has shifted from being a volunteer effort to being a corporate initiative. Of the many thousands of changes that have been made to the Linux kernel over the past three years, fully 73.2% came from employees working on behalf of their companies. (Three companies - Red Hat, Novell, and IBM - accounted for 28.4% of all the changes.) Only 13.9% of the changes came from volunteers without a corporate affiliation, and the remaining 12.9% of changes came from developers whose affiliation is unknown. Write the authors of the report: "It is worth noting that, even if one assumes that all of the 'unknown' contributors were working on their own time, over 70% of all kernel development is demonstrably done by developers who are being paid for their work."

The Linux kernel is now "largely the product of professionals, not volunteers," observes Tom Slee:

Linux has become an economic joint venture of a set of companies, in the same way that Visa is an economic joint venture of a set of financial institutions. As the Linux Foundation report makes clear, the companies are participating for a diverse set of commercial reasons. Some want to make sure that Linux runs on their hardware. Others want to make sure that the basis of their distribution business is solid. And so on, and none of these companies could achieve their goals independently. In the same way, Visa provides services in many different locations around the world in different sizes and types of stores. Some banks need their service mainly in one country, some in another, but when they work together they all get to provide their services all around the world.

There's nothing particularly surprising in the shift from the volunteer to the corporate model - it tends to be what happens when lots of money enters the picture - but it does reveal that while Net-based "social production" efforts may be unprecedented in their scale and unusual in their technology-mediated structure, they are no more immune, or even resistant, to being incorporated into established market systems than any other type of labor that produces commercially valuable goods. The shift in Linux kernel development from unpaid to paid labor, from volunteers to employees, suggests that the Net doesn't necessarily weaken the hand of central management or repeal all the old truths about business organization. "As open source software has matured and expanded it has become both more unlike the rest of the world and more like it," writes Slee. "It will be fascinating to see what comes next, but the Linux Foundation report has made clear that open source has crossed its commercial Rubicon, and there is probably no going back."


I think the analogy of Visa is misplaced: Visa is a corporate entity in its own right which controls the technology and usage. Banks do not shape it any more than customers shape a normal product.

As for the shift towards paid programming, though it doesn't surprise me, I think the more interesting question is how Linux governance is changed and I'm not sure quite how to answer that.

Posted by: Kevin [TypeKey Profile Page] at April 21, 2008 01:36 AM

Hmmm. I wonder if, in Long Tail terms, the paid work gravitates towards the head, while the tail tends to lack the revenue required to generate paid positions.

For example, in the future online video world, would the majority of video produced be produced by paid professionals, or would the top 1% of video "franchises" be produced primarily by paid professionals.

To be sure, Linux is a project at the head of the open source market. It may not be a good model of the majority of open source projects out there--most of which struggle on with a motley crew of unpaid volunteers or struggling entrepreneurs.

It seems unrealistic to generalize Linux to all of open source or "social production". Just the "best" stuff.

Posted by: James Urquhart [TypeKey Profile Page] at April 21, 2008 02:22 AM

I think it would be interesting to see this "open source as joint venture" concept flow down into enteprise software. Many enterprise software customers maintain signigicant development staffs to customize off-the-shelf products. Between the cost of licenses, maintenance, customization, and opportunity cost of using poorly fit enterprise software, it seems to me that companies could band together and develop their own at a lower cost.

Of course, every time I suggest this people look at me funny. But one day...

Posted by: Erik Engbrecht [TypeKey Profile Page] at April 21, 2008 09:49 AM

A shift to consortiums using in-house labor is quite proper yet...

One has to observe that this has come about (and only to 70% and only at such high levels in just a few core projects) -- this has come about by accident.

Meanwhile, the corps are still pretending, at some level, to be the GNU project in the sense of soliciting unpaid volunteer labor as if their bottom line were a political cause. They set out, in the days of Cygnus, to take over GNU and they've never looked back. And today you can buy books from open source celebrities about how to maximize your ROI in recruiting unpaid volunteer labor.

The "70-something %" stats from kernel studies and such are going around a lot these days among the open source profiteers. They are looking for cover because the, to borrow from the marxists, the contradictions of their approach are becoming increasingly apparent to hoi poloi.


Posted by: Tom Lord [TypeKey Profile Page] at April 21, 2008 01:15 PM

I happened to be speaking with Clay Shirky just after this post went up, and he had some interesting comments on the idea that "the Net doesn't necessarily weaken the hand of central management or repeal all the old truths about business organization."

Shirky on IBM paying engineers to work on Linux:

"It's not IBM's product...[You] have IBM and Novell effectively collaborating with no contractual agreement between them, and no right to expect that their programmers' work is going to be contributed to the kernel if people external to those organizations don't like it. And that's a huge change...paying someone a salary without being able to direct their work is probably the biggest challenge to managerial culture within a business that one can imagine."

Full post here.

Posted by: Ed Cone [TypeKey Profile Page] at April 23, 2008 10:40 AM

Ed, I like the title of your full post but I wish what came under it lived up to it.

Long before Linux, IBM paid handsomely to, for example, cooperate on the development of X11. There too, competitors had equal access and equal benefit. There too, the aim was for a technical meritocracy.

To characterize the Linux kernel project as some wild, uncontrollable phenomenon, driven solely by a "ruthless meritocracy" is ludicrous. One need only observe who butters Linus' bread, and how, and the means by which he is promoted (e.g., by parading this fundamentally unimpressive "70%" metric around).

People consistently miss the larger story which is the corporate subversion of a political movement and the ongoing exploitation of free labor.

I worked in an IBM shop when the first GNU programs -- GCC, GDB, and Emacs -- were released. I was in rooms where the executives' take on it and interests were being explored. It was quite simple: at that time, the development tools market was starting to boom. Investment capital was concentrating on it. The first GNU releases killed that and investment in that space contracted and never picked back up to the same levels of interest. A growth market had been destroyed.

No small part of what investment did continue in this area, after that, went to strategies that were aimed at coopting the GNU phenomenon and leveraging the "gratis labor." I was in the room for that, too.

Works such as Mr. Shirky's recent effort continue a program of propoganda that started then and that grew as GNU/Linux became a commercial success. These firms and their "independent" representatives continue to mythologize their collection of gratis labor and encourage an ersatz politics of volunteer participation in these fundamentally corporate, private-interest projects.


Posted by: Tom Lord [TypeKey Profile Page] at April 23, 2008 05:25 PM


Thanks for noticing the title.

I'm not sure how Shirky's remarks could be seen as an attempt to "mythologize [a] collection of gratis labor and encourage an ersatz politics of volunteer participation in these fundamentally corporate, private-interest projects," as he explicitly addresses the efforts and implications of paid corporate labor.

There's no blind utopianism in the post; it's a look at what the evolution of Linux development in the corporate realm means for corporate entities and management, not an attempt to pretend we're still in the volunteer phase of the game.

Posted by: Ed Cone [TypeKey Profile Page] at April 23, 2008 09:32 PM

That's just it Ed. No, it doesn't pretend we're still in the volunteer phase of the game. It pretends we're not and it has to do that because these firms have no legitimate excuse whatsoever for coming within 100 yards of the volunteer community. Yet, we are very much still in a situation where these firms dominate the volunteer community.


Posted by: Tom Lord [TypeKey Profile Page] at April 24, 2008 01:57 AM

Shirky's not making a value judgment about who should be working on Linux.

He (like Nick) is looking at the data from the Linux Foundation, and discussing the implications for corporate and organizational culture.

Posted by: Ed Cone [TypeKey Profile Page] at April 24, 2008 06:06 AM


Ethics don't disappear from a topic just because you are talking about "impliations for corporate and organizational culture." Rather, they are central to such topics. True enough that people seem to have forgotten that these days in the Web 2.0 / commercial Linux / madness-of-crowds salons but that forgetting doesn't make them right.


Posted by: Tom Lord [TypeKey Profile Page] at April 24, 2008 11:51 AM

IMHO, what has always scared the suits away from GNU/Linux and open source in general is the loss of control over proprietary intellectual property. In their minds, patented proprietary software is like a real property mortgage that you can could record on your balance sheet as a tangible asset. GPL nixes that and that's what has made the suits wary of adopting OS software since you can loose your original art by mixing it with GPLed stuff. With the advent of SAAS, the fear is just not there anymore. You can get your supporting software for free much cheaper that the electricity or water in your building!

I remember reading circa 2002 that IBM employed about 600 full time OS developers; the last article in Business Week last year quoted the same figure five years later. The good thing for corporate is that although they cannot re-license it(a’la M$), the labor cost to maintaining it on a global scale is small. And, from what I've read the labor cost for OpenBSD are even less. Sounds like a deal to me!

Posted by: Linuxguru1968 [TypeKey Profile Page] at April 24, 2008 03:40 PM

I too wonder why this joint development model has not been adopted by companies.

As Linuxguru suggests part of the reason is this loss of control. It’s also partly that companies are in denial about the value of open source products and remain wedded to the need for proprietary development. Corporate computing does not attract visionary types. However as I.T. budgets come under increasing pressure the cost of control and proprietary development will become unacceptable.

For software vendors of course, a move in this direction represents the ultimately unspeakable nightmare.

Posted by: Greg Quinn [TypeKey Profile Page] at April 25, 2008 04:19 AM

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