Open Source Business   Models Industry    Perspective  Manuela Aparicio, ISCTE-IUL              &   Carlos J. Costa, ISCTE...
Index  1. BM- Evolution  2. BM- Motivations  3. Information Systems Lifecycle  4. Economic Reasons to Use FOSS            ...
Business Models Evolution“By establishing a successful open source  platform, software firms can compete more  effectively...
Motivations of FOSSThe most common economic motivation is to● save costs in the software development●    sharing costs●   ...
OS Foudations Purposes●    Ensure FOSS long-term survival●    Increasing the Systems Lifecycle                            ...
Extending Information SystemsLifecycle (1/3) (Costa & Aparicio, 2005)            Manuela Aparicio & Carlos Costa   6
Extending Information SystemsLifecycle (2/3)Four strategies:●    ●        - Perpetuate system;    ●        - Manage transi...
Extending Information SystemsLifecycle (3/3) (Costa & Aparicio, 2005)           ●The transition process may consist in a  ...
Extending Information SystemsLifecycle (3/3) (Costa & Aparicio, 2005)               This perspective is different from man...
Lifecycle Extended by FOSS●    Open code allows code adaptations●    Open code allows to integrate new SW    modules      ...
MicroEconomic Reasons to Use FOSS●    Cost Savings         ●             Sharing development expenses         ●           ...
Price-Sensitive Customers Effects          Manuela Aparicio & Carlos Costa   12
Increases Total Market         Manuela Aparicio & Carlos Costa   13
MacroEconomic Reasons to Use FOSS●    Improve the External Payments Balance        ●            Decreases software imports...
Ref. BibliograficasCosta, C. & Aparicio, M. (2005) “Managing the Information System  Life Cycle in Construction and Manufa...
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Business Models Opensource Industry Perspective

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Business Models Opensource Industry Perspective

  1. 1. Open Source Business Models Industry Perspective Manuela Aparicio, ISCTE-IUL & Carlos J. Costa, ISCTE-IUL
  2. 2. Index 1. BM- Evolution 2. BM- Motivations 3. Information Systems Lifecycle 4. Economic Reasons to Use FOSS Manuela Aparicio & Carlos Costa 2
  3. 3. Business Models Evolution“By establishing a successful open source platform, software firms can compete more effectively across technology stacks and thereby increase their addressable market.” (Riehle, 2010) Manuela Aparicio & Carlos Costa 3
  4. 4. Motivations of FOSSThe most common economic motivation is to● save costs in the software development● sharing costs● Increased revenue through the provision● Increased sale of complementary products● Increase market Manuela Aparicio & Carlos Costa 4
  5. 5. OS Foudations Purposes● Ensure FOSS long-term survival● Increasing the Systems Lifecycle (Alter, 2001) Manuela Aparicio & Carlos Costa 5
  6. 6. Extending Information SystemsLifecycle (1/3) (Costa & Aparicio, 2005) Manuela Aparicio & Carlos Costa 6
  7. 7. Extending Information SystemsLifecycle (2/3)Four strategies:● ● - Perpetuate system; ● - Manage transition ● - Prepare heir ● - Manage strategically (Costa & Aparicio, 2005) Manuela Aparicio & Carlos Costa 7
  8. 8. Extending Information SystemsLifecycle (3/3) (Costa & Aparicio, 2005) ●The transition process may consist in a parallel process. ●This process allows the old system usage simultaneously, while a new system is launched. Manuela Aparicio & Carlos Costa 8
  9. 9. Extending Information SystemsLifecycle (3/3) (Costa & Aparicio, 2005) This perspective is different from managing a portfolio of applications, it consists on prevalence of families (or “dynasties”) of information systemsA firm may implement one of several ofthose strategies. Manuela Aparicio & Carlos Costa 9
  10. 10. Lifecycle Extended by FOSS● Open code allows code adaptations● Open code allows to integrate new SW modules (Kavanagh, 2004)FOSS endures the maintenance phase of the● system lifecycle (Costa, 2009) Manuela Aparicio & Carlos Costa 10
  11. 11. MicroEconomic Reasons to Use FOSS● Cost Savings ● Sharing development expenses ● No licenses to pay● Profits per sale in the market ● Competitive economic advantage● Pricing flexibility for vendors ● Increase sales (price-sensitive customers)Increase of total market size● ● Vendors can also benefit from the customers non-expense in closed source, because their budget increase (Riechle, 2010) Manuela Aparicio & Carlos Costa 11
  12. 12. Price-Sensitive Customers Effects Manuela Aparicio & Carlos Costa 12
  13. 13. Increases Total Market Manuela Aparicio & Carlos Costa 13
  14. 14. MacroEconomic Reasons to Use FOSS● Improve the External Payments Balance ● Decreases software imports ● Might increase exported services ● Decreases Royalties and import licensing● Improve the economical growth ● Increases internal production ● Increases employment in services ● Increases the taxes revenues● Motivates Development ● Competitiveness (SW) (Costa, 2009) & (Aparicio & Costa, 2012) Manuela Aparicio & Carlos Costa 14
  15. 15. Ref. BibliograficasCosta, C. & Aparicio, M. (2005) “Managing the Information System Life Cycle in Construction and Manufacturing”, in World Academy of Science Engineering and Technology Journal 2005Costa, C. (2009) [Open Source e Modelos de Negócio], presentation on Business Technology World, 2009, http://www.slideshare.net/carlosjcosta/open-source-e-modelos-de-Carlos Costa, Professor and Reseacher at Iscte - Iul | SlideShare N.d. http://www.slideshare.net/carlosjcosta, accessed November 29, 2012.Aparicio, Manuela, and Carlos J. Costa (2012) Macroeconomics Leverage Trough Open Source. In Proceedings of the Workshop on Open Source and Design of Communication Pp. 19–24. OSDOC ’12. New York, NY, USA: ACM. http://doi.acm.org/10.1145/2316936.2316941 Manuela Aparicio & Carlos Costa 15

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