Archive for November 17th, 2013

Economy and Open Source   no comments

Posted at 8:25 pm in Uncategorized


We could define Economy as an infrastructure of connections among producers, distributors, and consumers of goods and services in one community. On the other hand, we could state that the Internet is a global network that connects public and private sectors in different ecosystems : industry, academia and government.

There is no doubt about the potential of Internet in the economy of a country because it can minimize the transaction cost of goods and services, creating efficient and productive distribution channels, developing clusters of specific areas, increasing supply and demand and providing more consumer choices.

For this reason, technology plays a crucial role for the decision making process because it helps us to create strategies and to develop solutions. In the last two decades proprietary or closed source software dominated the industry, causing high costs derived of licenses and patent use, restricting users to modify, redistribute or share their products. Furthermore, the use of reverse engineering in private software result in a penalty or even jail, inhibiting innovation and software development.

Nowadays, public and private sectors in any domain provide the opportunity to use open source software as an alternative in order to increase security, reduce costs, improve quality, develop interoperability, customization, but mainly to uphold independence and freedom.

Some people think that open source software is not a real choice because there is not technical or financial support; however, in these essays we will study the open source phenomena and their implications in the global economy.

First, let start by defining the term open source:

According to the Open Source Initiative, (1):

“Open source doesn’t just mean access to the source code. The distribution terms of open-source software must comply with the following criteria:

1.-Free distribution

2.-Source code

3.-Derived works

4.-Integrity of the author´s source code

5.- No discrimination against persons or groups

6.- No discrimination against fields of endeavor

7.-Distribution of licenses

8.-License must not be specific to a product

9.-License must not restrict other software

10.-License must be technology neutral

In the same way the Open Source Paradigm (2) explains that:

In an ecosystem composed by academic institutions, companies and individuals that come to the idea to solve a specific need through software development. Mostly, the initial project is done by just one entity and subsequently is released to the community in order to share and to continue the development or the knowledge. If the software is useful, others members make use of it and just when the algorithm is solved by the software development and it is useful to others the circle of Open Source paradigm is completed.

A good example of the use of Open Source Paradigm is the Apache Web Server because it had been built by a group of people who needed to solve the their web server problems. This group were kept in touch by email and they worked separately, but they were determined to work together and coordinately and finally their first release were in April 1995.

Furthermore, the Open Source paradigm promotes paramount economic benefits. For instance, Open Source allows better resources allocation, it can dispense the risk and cost related to projects and it gives the control to users allowing them to customize it according to their needs.

In summary, we can say that, Open source encourages people to work together toward a specific goal and the desire to create solution, promoting innovation and software development.



1.-Open Source Initiative [n.d.] Open Source Initiative [online]

Available from: [Accessed 05 November 2013]



2.-Bruce Perens (2005) The Emerging Economic Paradigm of Open Source [online] George Washington University. Available from: [Accessed 12 November 2013]

Written by Alan Ponce on November 17th, 2013