product: open source, ecosystems, and intellectual property issues

Open Source: What ?

Software:• Distributed with source code• Includes a license that allows users to modify

etc. Establishes other “rules”• Version is available for free• Open standards versus Closed / Proprietary

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Open Source: Examples

• Linux: 1991, Operating System (Businesses)• Apache: 1995, Web Server, 45% market share• Firefox: 2003, Web Browser, 19% market share• Wordpress: 2003, Blogging Platform



Open Source: Examples

• Hadoop: 2005, Big Data• Android: 2007, Mobile Operating System (Linux

Fork)• Bitcoin: 2009, Cryptocurrency• OpenStack: 2010, Cloud

• OpenSSL: 1998, Encryption (Heartbleed)– Core Infrastructure Initiative



Open Source: Evolution

• Life Cycle curve

• From Philosophy to:• Business cases



Open Source

• Free Software movement to:– Richard Stallman (Idealist)

• Open Source movement– Eric Raymond, Linus Torvalds (Pragmatist)– Linux, Cathedral & Bazaar

• Fertile ground for Linux projectDigital Marketing [email protected] University of Delaware


Open Source: License

Expresses use, for Copyrighted software:• Right to share, use and spread, versus hoard• GPL (Copyleft): Stallman FSF– Source code freely available– Free version– Changes back to project– License remains with derivative works– Anyone can distribute product

• Apache: Expands business case– More permissive: license does not have to remain with

derivativesDigital Marketing [email protected] University of Delaware


Open Source: Requirements

• Leadership, examples:– Linux Foundation, Linus Torvalds– Apache Software Foundation

• Effective communications infrastructure• License• Developer Community: nurture• Useful Project (stage of life cycle)– Compete with incumbent re: price and utility– Innovate (Hadoop)



Open Source: Requirements

• Rewards– Ego– Instant gratification– Network effects (Product)– Utility

• Corporate contributions– Red Hat: Linux– Google: Linux– Yahoo: Hadoop



Open Source: Advantages

• Network Effects• Rapid Development Cycles• Cost Savings• Protected from Lock-in– Alternate vendors– Life of code (Windows XP)



Open Source: Advantages

• Flexibility in implementation• Influence development• Developer community support• Spread the code, sharing



Open Source: Risks

• Free rider effect ?• IP risk? (Apple versus Samsung)• Forking (Android / Kindle Fire)• Security (OpenSSL versus Linux)



Open Source: Business Models

• Cost and innovation sharing– Apache– Facebook (storage)– Hadoop

• Market Position– Firefox - defensive

• Market Share– Android



Open Source: Business Models

• Support model– Red Hat (Linux)– Cloudera / HortonWorks (Hadoop)

• As a Service: hybrid with proprietary code– Facebook, GitHub, Amazon



Crowdsourcing: Examples

• The product– Open Source– Wikipedia– Machine learning (Waze)

• The service offering– Uber– Airbnb



Crowdsourcing: Examples

• The funding (Crowdfunding)– Kickstarter, Indiegogo, Gofundeme– Funding (not capital investing)– Community around an idea– $1bn on Kickstarter, longtail– Oculus, raised $2.4m on Kickstarter

• The Marketing / Events– #hashtags



Ecosystems: Examples

• Mobile– BlackBerry– iOS (developer $s leader)– Android (market share leader)– Windows (Gaming?)

• Social Networks– Facebook (lost gaming F8 returned)– Twitter (developer conference returned)

• Apple Pay: retailers, banks• Wearables: Nike out, Android Wear, Google Glass• Auto-interface: Apple versus Android Auto versus Industry



Ecosystems: APIs

• Application Programming Interface (API)• Gateway between app developer community

and platform• Set of rules developer needs to know that the

app works



Ecosystems: APIs

• API communicates platform updates• Open versus closed (relatively)• Stage of lifecycle impacts API strategy for

platform



Ecosystems

• Build community around platform– Conferences: updates / roadmaps / APIs

• Positive sum relationship– Outsource development expands possibilities

(resources & imagination)• Increasing returns• Consumer lock-in hinders new entrants



Ecosystems

• App developer community priorities• Customer experience depends on entire

ecosystem

• Versus closed system: Car



Intellectual Property: Patent

• Novel and useful invention• Need to file: USPTO• 14 or 20 years, from file date• Standards Essential Patents• Patent Trolls



Intellectual Property: Patent

• Invent, license or litigate• Google Contact Lense• Amazon 1 click Patent (with shopping cart)• Apple versus Samsung (Google’s Android)• Tesla• China



Intellectual Property: Copyright

• Expression of work• Subsists (no requirement to file)• 70 years after death of author• Digital Millennium Copyright Act: Safe Harbor• SOPA (Internet blackout)



Intellectual Property: Copyright

• Napster / MegaUpload• RIAA, MPAO• Google’s YouTube versus Viacom• Getty Images• Aereo loses• Vine and World Cup: Fair Use ?



Intellectual Property: Trademark

• Name protection– Permanent while in use, build brand

• Apple versus Apple: 30 year dispute• Google: Glass• Apple: App Store

• Trade Secret– Search algorithm

