Is there money in open-sourcing your Web site?

Open source doesn't complicate EveryBlock's revenue dilemma. A free service does. The revenue problems for Web companies and open-source companies are largely the same.

As noted on the O'Reilly Radar, EveryBlock, a Web service that "crawls local data sources , aggregates the data, then surfaces (it) geographically " to enable you to see things like local police and traffic reports, has decided to completely open-source its Web site under the terms of the grant that funded its development.

That's great, right? Everyone benefits when everything is free, right?

Well, maybe not. You see, there's this silly thing called money that the EveryBlock employees would like to ensure they have to do things like "pay bills," "buy food," and "put as little gas as possible into their energy-efficient Prius cars."

Under the terms of our grant, we're open-sourcing the EveryBlock publishing system so that anybody will be able to take the code to create similar sites.

That's a Good Thing, in that EveryBlock's philosophies and tools will have the opportunity to spread around the world much faster than we could have done on our own, but it puts the six of us EveryBlockers in an odd spot. How do we sustain our project, if our code is free to the world?

My own personal take is that there's no reason that open-sourcing the infrastructure of the Web site should affect the company's ability to charge for the services rendered through the site, especially if it's ad-supported. (Currently, it's not).

Consumers don't care whether the innards of the service are open source, and competitors, while free to take EveryBlock's code, must also compete on brand and service to the customer. These aren't things with which code necessarily comes.

It seems that EveryBlock's revenue dilemma would be no different as an open-source company than as just another Web 2.0-type company. The revenue problems for Web companies and open-source companies are largely the same: if you're giving away software or services, you still need to find compelling reasons for people to pay you, whether for those software and services or for something else.

Figuring out that "something else" is EveryBlock's problem, not open source.


Follow me on Twitter at mjasay.

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About the author

    Matt Asay is chief operating officer at Canonical, the company behind the Ubuntu Linux operating system. Prior to Canonical, Matt was general manager of the Americas division and vice president of business development at Alfresco, an open-source applications company. Matt brings a decade of in-the-trenches open-source business and legal experience to The Open Road, with an emphasis on emerging open-source business strategies and opportunities. He is a member of the CNET Blog Network and is not an employee of CNET. You can follow Matt on Twitter @mjasay.

     

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