Envisioning an Open Source Product Marketplace: Could it Work?
What I've learned in 18 months of Drupal product management is this: monetization in open source communities is prickly. You need only whisper the words "app store" at a pub in Croydon to start a full geek-on-geek brawl about monetization in Drupal and its potential ill effects on the open source community. Monetization of products in Drupal is scary -- done right, it could build a vibrant economy around the open source software we know and love, making it stronger while people make a living. Done wrong, and it could alienate the community, deprecate innovation, and ultimately harm the open source project. Seriously, I realize I'm just waiting for the comments to get filled up with accusations of trying to destroy Drupal.
So, I get it. It's prickly. But the truth is, people and companies have been "monetizing" in Drupal for as long as its been around. Thousands of us happily sell services and build custom Drupal code for other people for money. We seem to be generally okay with selling premium themes and designs for Drupal. Our community boasts paid hosting, paid support, paid storage, paid security, and paid accessibility around Drupal sites. Some of us even monetize by getting "sponsorship" to work on and improve the open source modules and tools we all know and use.
Most of these revenue models revolve around services -- where time is our currency and hours worked = dollars earned. It's only natural that the community is starting to ask: what about products? Products offer the promise of "passive revenue" -- the ability to leverage our time into ongoing and recurring revenue streams; to "make money while we sleep." It's the stuff that venture capital dreams are made of.
But the issues are tricky -- if you "sell" code that is GPL (which is allowed), someone can turn around and offer it for free. And if we start packaging up Drupal code and putting a price on it, will anyone keep developing the stuff that's free and open source?
We faced these hard questions last month at the Drupal Distro Summit prior to SandCamp in San Diego. About 50 people -- all companies and individuals involved in distributions in the Drupal community -- joined up to discuss the issues facing distributions and products in Drupal. One after the other, distribution owners asking the question "I built this thing, now how can I realize the benefit of this investment?" We discussed business models at length, and saw ideas emerge around "premium" or "enterprise" distribution versions, apps, SaaS offerings, franchise models, and paid support. Not surprisingly, no silver bullet business model emerged at the end of the day. What did emerge was a clear indication that members of the community who have built companies and make their living selling work around Drupal are interested in seeing a viable way to monetize Drupal products, without deprecating (and possibly, by boosting) Drupal's most important asset: its community.
At Phase2, we agree: a product marketplace in Drupal that strengthens the community and makes building in Drupal economically feasible for more people would be a good thing. A marketplace where developers, site builders, and Drupal "consumers" alike could find the products and services they're interested in; offer their own products and services; and evaluate Drupal products on their merits -- the quality of the code, the reliability of the provider, the reputation of the developer -- is a marketplace we'd like to participate in.
How to accomplish a product marketplace, however, is quite another matter. Spoiler alert: I don't have the answer. But I do think there are three things that I think are most important in a healthy open source product marketplace:
1. The marketplace is not owned or dominated by any one company;
2. The marketplace does not in any way subvert or replace the open source ethic; and
3. The market places a high value on community contribution. And walks that walk. I'll explain.
First, an open marketplace that truly encourages competition and merit-based products in Drupal won't work if it's sponsored or owned by a single company. We'll set aside the fact that the effort to build that marketplace would require more time than any one of us can devote. Just as in the development of open source software, collaborative group of companies, freelancers, and individuals will better represent the needs of all than a single company or person ever can. The product of that collaboration will be more fair, better vetted, and a representation of everyone's needs. This marketplace concept can be (and should be) a compliment to what Drupal.org, the Drupal Association or the community at large can offer in it's current concepts and not a replacement.
Second, a marketplace for open source products should work with and not around the open source model. That means most modules, themes, install profiles will remain free and open and GPL licensed. Things sold in a marketplace would be enhancements and services with non conflicting goals.
Third, a marketplace should place value (as in actual, measurable value) on contributions to the open source platform itself in order to be mutually beneficial to both the community and the product's seller. If people choosing a Drupal distribution for their web site could also see how much that product's developer had contributed back to Drupal -- how many modules, how many patches, how many commits, how many documents written -- wouldn't it serve the dual purpose of rewarding community contribution and ensuring a high level of knowledge about the platform itself? If community contribution becomes part of the currency, rather than an after-thought or "nice to have," there's an opportunity and an incentive to build the community and the economy around this platform simultaneously.
None of us have all the answers to make this happen perfectly. But if we start from a few ideals -- where collaboration, contribution, and the open source spirit are valued by the marketplace -- it's not a far leap to monetized Drupal products that serve the community while filling a real need in the market. Next week, we'll be joining teams from around the world at the Drupal Product Summit in Rome (and if you can join us, you should). I'm hoping that the conversation can turn from "how do we each support our own products?" to "what could an open source product marketplace look like?" and further, "could we achieve it, together?" If this community has proven anything, it's that together, we can create a collaborative place for people to build amazing software and make a living doing it with our services. So why not products?
Comments
The great digital divide.
The comments below relate more to products rather than services: "...makes building in Drupal economically feasible for more people would be a good thing" I do not see how having to pay for a product would make Drupal any more financially feasible, especially with living in a country with a terrible exchange rate. Perhaps in a situation where the amount of hours saved on a project by using a paid for product outweighed the cost of a developer implementing the functionality for that project then yes it would make it more financially feasible, but in the case of a project with more than merely basic functionality going for less than $300, then no. Going further than that it is now rather difficult to get a credit card as either a freelancer or small business due to rather strict regulations, nor do is there a workable system for using paypal. I highly doubt that this is the only country in this situation.
"If people choosing a Drupal distribution for their web site could also see how much that product's developer had contributed back to Drupal -- how many modules, how many patches, how many commits, how many documents written -- wouldn't it serve the dual purpose of rewarding community contribution and ensuring a high level of knowledge about the platform itself?"
One of the beauties of Drupal in my opinion is that the software is free to be had to anyone as long as they have an internet connection, I know large companies have bottom lines and profit margins to attend to, but so does everyone else. In some cases having to pay extra to get the desired functionality or the product that would make a project feasible would prevent the project ever getting past the stage of ideation.
These may just be the views of someone currently unable to contribute financially to any of the vast amounts of open source software I use each day, but raising the entry bar further for emerging markets or those financially desolate parts of the world grates my soul. It is what makes doing any form of serious work with Joomla or WordPress either despairingly shoddy, or completely overrun with adverts on the backend. To get around the mass of spam on the back end of a WordPress blog I used a while back would have cost around $55, it was at that moment that I realised how much more awesome Drupal is than what I had thought.
I look forward to becoming a better contributor to Drupal, but for me, paying for products would sour the deal even if I could afford them, just by knowing I was further fueling the great technological divide.
Solutions
Hi Bleak,
Interesting thoughts, especially the 'Emerging markets' (or rather the 'Emerged markets' imo) perspective. Personally I've been interested in the challenge of the introduction of Drupal in developing regions (adaption of Drupal is currently vastly dominated by Europe and the US).
In short I'd be curious towards your thoughts on the following: What if a Drupal product is offered that focuses on site builders rather than developers, that is packaged with a hosting, customer management/ invoicing and maintenance infrastructure? And say it would be no-cure no-pay? Meaning web designers from any part of the world can deploy distributions (sites) geared towards quick site building (going beyond the basic functionality, saving many hours of development time and cutting the learning curve)? Only to be charged if a site actually goes live? In the form of a percentage of the site builders revenue on the project?
So you'd get a free site creation platform, including hosting and all the paraphernalia, and you only pay for the sites you actually sell. Call it a franchise or whatever you like. Would such a centralized infrastructure make it easier for emerging market based web designers to start up and operate a Drupal shop? Not having to deal with credit restrictions or up front investment (well, a pc or laptop maybe with internet connection)? Could it make for an affordable pricing strategy to emerging market customers, as the Drupal distributions cut development time back to a mere few hours?
To me this thought sounds both viable and interesting. Again, curious to learn your opinion on this.
GPL
Second, a marketplace for open source products should work with and not around the open source model. That means most modules, themes, install profiles will remain free and open and GPL licensed. Things sold in a marketplace would be enhancements and services with non conflicting goals.
I'm not a lawyer, I don't play one on TV, and I'm driven to drink anytime I have to read legal-speak. But I was hoping you would explain how this would work with respect to the GPL. I still do not see how something based on GPL'ed code, and then distributed, can be released without the GPL licence.
Regardless of the legality of a marketplace, my concern is that we would start seeing castrated version of modules released on drupal.org while "premium" version were available in the marketplace. Can you imagine what would happen if Views were released that way? I don't think Drupal would be what it is without the fully intact Views module being just a few (free) clicks away.
Finally, I must admit I expected to be spitting fire after reading your article when I saw the title on the d.o aggregator. But I appreciate your focus on maintaining community and taking into consideration the donated development shoulders that any marketplace module would stand upon.
Perhaps there is a way to make this work, though I'm still skeptical.
There is more than code to work with
There are quite a few add-on services you could bundle with a GPL module:
Modules would stay modules, it's the specific packaged feature sets bundled with all the supportive materials that become paying applications.
One central point i still
One central point i still don't understand in the full app-store debate is that how would you take care that each contributor get some money.
The approaches written down in the blog post above seem only to care about the "product-maker", but they are not all the people which are involved here.
There are so many contrib modules which are maintained basically in the freetime but then actually are "sold" as part of a commercial product.
Are there any plans to bring this aspect into the game?
One of the unique selling
One of the unique selling points of Drupal is the collaborative nature of the community. Developers of similar modules don't compete, instead they merge, fork and discuss. They certainly don't charge each other for installs.
Any solution to product based monetization while preserving community, collaboration and the nature of the GPL is not obvious to anyone and is likely to be a huge waste of time as it would inevitably pussyfoot around the obvious but undesirable option of "paid modules".
Microfunding model for opensource marketplace
I see a good oportunity to do a opensource marketplace based on the microfunding model, like in goteo.org or kickstart project.
I never donate for a software, but probably I can contribute a little fund to some new features of a drupal product for example if join our needs.
Love this!
Love this idea, Aram!
Another similar model is the R&D/innovation funding platform that P&G pioneered awhile back, which is now collaborated on by dozens of companies. They open up calls for innovative solutions to the world, pay people to develop them, and get some of the best research and ideas back. Pretty cool: https://secure3.verticali.net/pg-connection-portal/ctx/noauth/PortalHome.do
Android Market: 67% free, 33% paid and donation supported apps
A well-known example is the Android Market (not open source), with 67% of free of charge apps. The 33% of paid apps include among them apps supported by donations. That is, there are apps with two versions, one free and the other paid with the same features of the free version, because it's intended for voluntary donations to support the app development work, and indeed part of the users donate.
On the other hand, Drupal and therefore Drupal apps are open source and GPL. That is, if they wish, developers can charge for distributing their apps, but other people can also distribute those same GPL apps free of charge. So, a viable solution is to provide your Drupal based app for free, but providing an easy way for users to donate if they wish to support the development of the app.
Thanks for the great discussion!
Wow, guys! Thanks for the awesome discussion. I never thought I'd take "not spitting fire" as such a high compliment, but I do.
One thing I'd like to clarify is that I'm not just talking about app stores in this model. At Phase2, we built the concept of apps in distributions to fulfill a specific usability need for site builders using Drupal distributions. The Apps module currently doesn't even support monetized apps! -- so we certainly don't see app stores as the end-all, be-all monetization model. The "marketplace" I'm talking about here is broader than that: I think a place where people can "shop" for all kinds of products in Drupal, whether it's a hosting product, support product, specialized distribution, theme, etc is bigger than any one single "app store," and one the community should explore as a way to foster innovation, provide needed products and services, and grow Drupal's overall capabilities. I hope the conversation steers in that larger direction, rather than people getting hung up on "app stores."
Also, for more thoughts on Drupal Products, I'd highly recommend this read from the folks at ISTO: http://www.istos.it/en/blog/drupal-products/our-drupal-product-manifesto
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