FOSS starts from the basis of having all of the code on the commons, removing the possibility that anyone can seek to profit by restricting access to it. Anyone is free to use it and build on it, to extend it or turn it into something else. The ease with which a FOSS project can be forked and taken in an alternative direction limits the degree to which users or developers have to tolerate any behaviour they dislike from the entity which is producing the software. If the people in charge of a particular version of the software make decisions that colleagues or users disagree with (e.g. new UI), those who reject that direction can opt out. There is no copyright restriction to prevent people from forming a new group to take a project in an alternative direction.
People who are paid to work on FOSS projects are still accountable to whoever is paying them, and there are FOSS projects where the dominant versions are more or less controlled by people on the payroll of a particular company.
Many participants in FOSS projects work on them part-time and do not need to generate an income from this work. FOSS projects that are not integral to the operations of organizations with resources to fund development have limited scope to generate money to pay contributors. In these cases most contributors will tend to be working on it part-time in whatever time they can spare, independently of whatever they do to earn an income.
Some participants and FOSS projects have found ways to generate an income by offering services tangential to the software, such as support with deploying the software or using it.
Red Hat is an example of a company that managed to generate significant revenue by selling subscription-based support and guarantees about compatibility to businesses that wanted to deploy Linux in their operations. It is, however, a rare example of an organization with this business model reaching a large size ($3.4 billion revenue in 2018).
FOSS software development may also be funded by grants from funding bodies or through government spending. The European Commission is decidedly pro-FOSS, having since 2000 a strategy for promoting internal use of FOSS and stipulating that software funded by its research and innovation actions should be FOSS wherever possible.
Nadia Eghbal has written an excellent and comprehensive report on “the unseen labor behind our digital infrastructure” which explores the prevalence of open source code in our digital infrastructure. The report paints a picture of freely provided commons-based digital infrastructure that is often not being looked after by its main beneficiaries.
Eghbal’s report describes several in depth examples of widely used important FOSS which is maintained on a shoestring budget by people who are stretched. The Heartbleed OpenSSL bug is one well known example, the library used by a majority of https sites had a significant undetected exploit for a number of years. The OpenSSL maintainers were stretched part-time volunteers, and the issue could likely have been avoided with more resources to fund coding and code review.
One of the issues Eghbal identifies is that the people who drive FOSS projects forward typically do not want to spend time trying to secure or administer funding for the effort. The success stories usually involve other people who step in to source and administer funding that allows the engineers to be compensated for their work with minimal distraction. The question of what kind of support structures help FOSS projects flourish is an important one, and is considered from a number of angles in the rest of the resource.
Eghbal also notes that the ideology of “Free Libre” Open Source Software is less important to many people who have embraced OSS recently. Adoption of FOSS practices is increasingly based on broader recognition of the practical benefits, without necessarily embracing the more ideological component of software that is “Free Libre”.
The disconnect between FOSS utility and funding has been receiving more attention lately. Initiatives like Formidable’s Sauce program allow employees to bill for work they contribute in their own time to open source projects which are unrelated to the company’s own interests. This is a rare example of an organization that gains a lot from FOSS deciding to give something back to support the commons.
GitHub has recently launched a sponsorship scheme through which open source developers can be sponsored, with GitHub matching the sponsorship received by developers in their first year up to a limit of $5,000. This is conceptually similar to Patreon, which also connects content producers with consumers who are willing to fund their work. In the case of GitHub Sponsors, it is woven into a platform which many FOSS contributors already use. These are centralized services, where the operator of the platform acts as a gatekeeper in deciding who can be funded through the platform.
I will consider the ways in which blockchain projects are funded in a later section, this is arguably where most of the innovation in FOSS funding is taking place.