Ask HN: How would you open source a SaaS business?
Today, Dangerous Prototypes posted this article:
http://dangerousprototypes.com/2011/09/21/editorial-upverter-another-closed-source-vampire-exploits-open-hardware-for-ventrue-capital-pr-and-profit/
Which asks for services like ours that help promote Open Source Hardware projects to play fair and open source our code too.
This is quite an interesting topic, I've been trying to think how open sourcing my code for CircuitBee would work from a business perspective. As I see it there are 4 business models for OS software that have been proven to work:
1. Open source the code, and sell support and infrastructure services at a high premium to business users.
2. Sell 'enterprise' or similar editions of the OS software, with additional features that are not OS.
3. Package up the OS software with some other tangible saleable good, usually hardware for the software to run on.
4. Selling further development services to businesses to customize or improve the core OS project.
CircuitBee is aimed at hobbyists - professional electronic schematics are still largely too complex to render in the browser. That means there are no businesses to sell support licenses to, and hobbyists certainly aren't going to pay for support. That largely rules out option 1.
Selling enterprise or improved versions of the software via a software as a service model that extend upon the open sourced version of the software would in my mind still not equate to an open platform. There would always be someone arguing that the platform is still not 'open' since the more useful features that differentiate my service from the inevitable clones based on the OS code would be closed only. So that rules out option 2.
Packaging up the software with another saleable product isn't possible in this case, so no option 3.
Option 4 is the only viable option on the table, but relies upon other businesses wanting customized versions of the platform. Which since the platform is largely unproven and as yet not something businesses are interested in, does not bode well as a business model in the short to medium term.
Added to all of the above is the fact that I am working on this full-time, unfunded and solo. If I opened up the code now, I would very quickly have competitors with all the same features as my own, who could potentially have more funding and manpower to drive the project forward and leave me in the dust with nothing but good intentions and a little bit of kudos for devoting 18 months of my life to something someone else is now profiting from.
What do you think? Is it possible to open source a SaaS project like CircuitBee while still maintaining some form of compensation for the ongoing time, effort and expense it incurs?