Making Money from Better Software

Two interesting business models for people who want to make money from open source software:

  • Coverity is using its static analysis tools to look for defects in widely-used open source packages. Their current report makes for interesting reading; equally interesting is the way that some communities (such as AMANDA) have responded---their defect density dropped dramatically after stats started appearing.
  • SpikeSource assembles (and sells) open source suites---Linux with Apache, PostgreSQL, Perl, etc.---that have actually been tested together, so that you can be confident they'll work.

The common element here is quality: people will always pay for it, just as they will for medicine and chocolate. Makes me wonder whether you could create a business selling insurance on software: "You give us $199/month, and if this crashes more than once per hundred thousand hours of operation, or if someone gets through the security, we'll pay you $10,000." We have a lot of data on how flaky various platforms are, and we can guesstimate the cost of downtime. If any grad students in economics are looking for thesis topics...