Economical Aspects and Adoption
See also: Linux adoptionFree software played a significant part in the development of the Internet, the World Wide Web and the infrastructure of dot-com companies. Free software allows users to cooperate in enhancing and refining the programs they use; free software is a pure public good rather than a private good. Companies that contribute to free software can increase commercial innovation amidst the void of patent cross licensing lawsuits. (See mpeg2 patent holders.)
The economic viability of free software has been recognized by large corporations such as IBM, Red Hat, and Sun Microsystems. Many companies whose core business is not in the IT sector choose free software for their Internet information and sales sites, due to the lower initial capital investment and ability to freely customize the application packages.
Under the free software business model, free software vendors may charge a fee for distribution and offer pay support and software customization services. Proprietary software uses a different business model, where a customer of the proprietary software pays a fee for a license to use the software. This license may grant the customer the ability to configure some or no parts of the software themselves. Often some level of support is included in the purchase of proprietary software, but additional support services (especially for enterprise applications) are usually available for an additional fee. Some proprietary software vendors will also customize software for a fee.
Free software is generally available at no cost and can result in permanently lower TCO costs compared to proprietary software. With free software, businesses can fit software to their specific needs by changing the software themselves or by hiring programmers to modify it for them. Free software often has no warranty, and more importantly, generally does not assign legal liability to anyone. However, warranties are permitted between any two parties upon the condition of the software and its usage. Such an agreement is made separately from the free software license.
A report by Standish Group estimates that adoption of free software has caused a drop in revenue to the proprietary software industry by about $60 billion per year.
Read more about this topic: Free Software
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