Open source and the commoditization of software

Linux: A response from the trenches

It was into this environment that Linux emerged in the early 1990s. At first the mere hobby project of a young college student, Linux captured the imagination of those who could best be described as the “collateral damage” of the UNIX wars. Two features of Linux made it appeal to this large group of users and developers: its compatibility with UNIX, with which they were intimately familiar; and that it was licensed under the GNU General Public License (GPL), which not only allowed the scores of UNIX refugees to contribute to its development, but also guaranteed that UNIX style fragmentation could never happen to the result of the community’s work, at least at the source code level.

Linux grew by leaps and bounds during the 1990s. As with previous challengers, it was first ignored, then ridiculed, by the incumbents, primarily Microsoft, which had used its position as the de facto standard operating system masterfully to expand into numerous additional markets and gain additional, even unprecedented, market power. Unlike so many companies that had come before it, Microsoft wielded the forces of commoditization expertly. By offering its products at lower prices than its competitors could afford to offer them, Microsoft effectively preemptively commoditized many of the markets in which it competed, depending on high volume to make its products profitable and making it impossible for challengers to undercut it.

As Microsoft’s power grew, so did the desire of Microsoft’s competitors to counter it. By the late 1990s, it was clear Linux was a powerful force, and many of the industry’s largest companies began to see it as a competitive weapon. These companies also recognized the power behind Linux wasn’t so much its technology as its licensing and development model, by now referred to as “open source”—and in particular, the open source model’s ability to “out commoditize” Microsoft.

The fundamental question is this: Why is Linux and the open source movement it helped launch able to out-commoditize Microsoft? Because it, like the PC, the Internet, and the other open systems and open standards we take for granted today, is more of an ecosystem than a technology. Indeed, Linux builds above those previous ecosystems—without open, commoditized hardware, and without the Internet to enable the open source development model to work, Linux would not exist today.

Microsoft may wield the forces of commoditization more expertly than any company that has come before it, but its platform is not an ecosystem. By definition, an ecosystem is an environment to be shared, not owned. Linux is positioned to become the lingua franca of the lowest level of the software stack, if we never forget it is an ecosystem and not a product to be owned. Looking at the lessons of the past, if it remains an ecosystem, we all win. If not, we destroy it.