A Strategic Analysis of Competition Between Open Source and Proprietary Software.

Author List: Sen, Ravi;

Journal of Management Information Systems, 2007, Volume 24, Issue 1, Page 233-257.

This paper analyzes a software market consisting of a freely available open source software (OSS), the commercial version of this OSS (OSS-SS), and the competing commercial proprietary software (PS). We find that in software markets characterized by low direct network benefits, the PS vendor is better off in the presence of competition from OSS-SS. Furthermore, the OSS-SS vendor in these markets is better off by having lower usability than PS. Therefore, the PS vendor has little incentive to improve the usability of their software in these markets. On the other hand, in software markets characterized by high network benefits, a PS vendor is threatened by the presence of OSS-SS and can survive only if the PS is more usable than the competing OSS-SS.

Keywords: commercial open source;economics of open source;FLOSS;open source software;software competition;software market

Algorithm:

List of Topics

#273	0.327	source open software oss development developers projects developer proprietary community success openness impact paper project associated activity phenomenon peripheral variety
#242	0.285	market competition competitive network markets firms products competing competitor differentiation advantage competitors presence dominant structure share using incumbent make important
#74	0.122	high low level levels increase associated related characterized terms study focus weak hand choose general lower best predicted conditions implications
#22	0.104	software vendors vendor saas patch cloud release model vulnerabilities time patching overall quality delivery software-as-a-service high need security vulnerability actually
#246	0.054	strategic benefits economic benefit potential systems technology long-term applications competitive company suggest additional companies industry operating costs difficult substantial total