OSS and the Power of Collective Intelligence

Wikipedia describes the current economic era we are in as the "Intangible Economy." In this era, four factors of production are the key resources used as competitive advantage in every economic activity. They are:

  • Knowledge assets (what we know)
  • Collaboration assets (who we interact with to create value)
  • Engagement assets (our level of effort and commitment)
  • Time quality (how quickly value is created)

By most accounts, the Intangible Economy did not start until 2002. How did we get here? I think it is the leveling effects of the Internet on commerce and OSS on IT.

Leveling Effects of Internet on Commerce
The Internet was started by the U.S. Defense Advanced Research Projects Agency for purposes of e-mail and file transfer. In 1991, World Wide Web (Web) was added as an additional service for interconnecting documents and other resources as links. According to Internet World Stats, as of June of 2007 there were 1.133 billion people using the Internet. The accelerating pace of growth for Internet is phenomenal compared to the growth patterns of Radio, TV or even the PC.

It was only a matter of time before the Internet, like the radio and TV, was applied to commerce. As browsers became available and enabled ordinary citizens to surf the Web, the Amazon effect kicked in. At the beginning, the Web did not provide rich, compelling and interesting information. Take a step back and think about what Amazon was able to accomplish. Millions of book titles that no shop or library could house under one roof were made available to the world with the click of a button. In addition, Amazon bypassed established power houses such as New York Times, and created its own Amazon Best Seller list based on its own sales. Shoppers at Amazon no longer relied on a few Ivory Tower reviewers to judge a book; instead they opted to read shopper-generated reviews. With one URL, Amazon was able to rock the foundations of the established players of its industry. Amazon used the Internet to create a commercial entity in a record time that no brick-and-mortar company could have ever imagined possible.

Following Amazon, a host of Internet-based companies were started and offered services that enabled small and medium-sized businesses (SMBs) to engage customers leveraging the new medium. With dramatically falling prices for the Internet technology, SMBs were able set up shop to not only exchange e-mail, documents, and information with their customers, but also streaming video, music, live chat, and sex. In a very short amount time, Internet allowed thousands of companies to flourish and compete head to head with established global giants.

Leveling effects of Open Source for IT
It may be hard to imagine, but what we now call OSS was once the norm. Software engineers using the hardware were also often the ones who would write the code and develop the applications. The source code and the applications were often made freely available to anyone who needed them through user groups. In the 1970s that changed as the Department of Justice ordered the large systems manufacturers to "unbundle" their software from their systems and the software became what we now think of as "proprietary."

Richard Stallman became disenchanted with that. He formed a "user group" to offer a "replacement for proprietary" software. Stallman wanted all software to be freely available to anyone who wanted to use it. In Richard's definition 'Free" refers not to price, but to freedom: freedom to change or hire somebody else to modify the source code, freedom to redistribute copies to share with other people and freedom to make improvements and publish them for others to benefit from it.

Similarly and around the same time as the Internet was leveling the field for SMBs in commerce, an unknown engineer Linus Torvalds in Helsinki, Finland released an operating system (OS) kernel that he called Linux (for Linus' UNIX) using Stallman's philosophy. He shared his source code with everyone, for free. The most amazing thing was that Linus' software also worked well. This was revolutionary! Aren't we supposed to guard our intellectual property and charge money for our software?

Apache, Red Hat and the Internet
As Richard Stallman and others started to rewrite and replace UNIX programs one by one on top of Linux, Internet technology made it possible for others to download and use them for free. However the meteoric rise of Linux did not take place until it found a killer app in the age of Internet. That killer app came in the form of web server software called Apache, developed to handle the complex web technologies that the Internet commerce companies needed. Apache servers powered by dependable Linux OS followed. The powerful combination offered tangible business benefits as cost effective and community supported alternatives to Microsoft's Windows and Internet Information Server (IIS). Other large software suppliers squeezed by Microsoft in their traditional backyard were all too happy to promote the Linux/Apache duo. As the commercialization of "free software" began, a new and descriptive name, open source, appeared. The Red Hat initial public offering (IPO) in 1999 changed the IT industry in many aspects. It upgraded the image of OSS from hobbyware to enterprise software; and made sophisticated IT affordable to companies of all sizes around the globe.

Our Time is the Right Time
This gives the SMBs unprecedented access to a greater breadth of high quality tools that are readily available at a lower total cost. This is evidenced by the availability of enterprise-ready OSS tools in virtually every segment of IT infrastructure including databases (MySQL, postgreSQL), application servers (JBoss, Geronimo), content management and network (Joomla!, Liferay), and systems management (Nagios, Zenoss).

Just as the Internet leveled the playing field for commerce, improved economics with the use of OSS allow the SMBs to participate in formerly cost prohibitive large enterprise activities like implementing IT Information Lifecycle (ITIL) principles. This ability to use affordable enterprise grade technology combined with world class processes enables SMBs to become competitive entities, which leads to unprecedented global economical growth. Companies around the world can now have immediate access to high quality IT that can be turned into competitive advantage and provide equal footing against large companies in open markets.

Just as with the Internet and commerce, OSS and IT professionals greatly benefit from massive worldwide collaboration and the ability to tap into "peer production." This is a combination of collective intelligence and collaboration in the same way the wiki website Wikipedia benefits from the collective wisdom of many people and video sharing company YouTube receives content from thousands, if not millions of users.

All of this brings us back to the era we live in, the "Intangible Economy." It relies on what we know and who we interact with to share knowledge for creating value. Its benefits are dependent upon our level of effort and how quickly value is created. The Intangible Economy creates the perfect environment for OSS to thrive supported by communities not bound by space and time. In these communities of choice location is not a factor for sharing knowledge for a common interest. The more we feel part of a network, the more we become willing to put in the effort to create value, based on our individual interests that are shared and benefited by others. Networks that operate beyond the boundaries of time and space are able to greatly increase the time quality in creating value.

It is no surprise that the OSS movement that has been championing the benefits of open collaboration, collective wisdom, and common interest-based participation is benefiting the most out of our Intangible Economy. OSS is the way of our time to develop and use any technology including IT. Companies who tap into the benefits will emerge as the leaders of tomorrow. Those companies that fail to adapt, will soon have their products exhibited at the Smithsonian.

About the Author

Murat Aksu is responsible for Products and Marketing for Zenoss. Formerly Director of Product Marketing of Application Delivery for Mercury Interactive/HP Software, Murat brings to Zenoss more than 10 years of experience in applications, security, and software markets globally. His previous experience within Mercury/HP Software saw Murat head up Competitive and Market Intelligence, Engagement Management and Pre Sales. Murat has built and managed marketing organizations for companies and division from zero to $200+ million in license revenues. Murat began his career as a technical manager at a variety of technology companies such as Manhattan Associates and Georgia Pacific. He holds a B.A in International Business from Florida State University and a MS in Computer Information Systems from Georgia State University in Atlanta.

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