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How do you measure the value of free and open source software (FOSS)? That’s a puzzler, because it’s, well, free. Moreover, a popular distribution like Linux can incorporate the contributions of thousands of individuals working remotely from around the world. That means that there are almost no associated overhead costs over and above the time of the developers themselves.

Even the question itself is a bit of a misnomer, because one measure of the value of FOSS is not the cost to build it, but rather the avoided cost of not having to do so. Because you don’t have to pay anything to download FOSS, and since the same project that developed the software will continue to maintain it for you, using free software can allow you to launch products and services that, for economic reasons, you would never otherwise attempt. In an effect that’s near and dear to my heart, that means that competition can reenter market niches that had become locked up and stagnant because entry costs to new participants were simply too high.

Trying to get a handle on the value of FOSS is still a worthwhile effort, though, because it allows people to appreciate the beneficial effects of FOSS in general, as well as to have greater respect for something that arrives without a price tag. By appreciating the amount of effort that goes into FOSS, not only historically but on a weekly basis, it’s easier to appreciate the robustness and responsiveness of the product as well. It also helps anticompetition regulators and legislators appreciate the significant pro-competitive effects that FOSS can have.

Last Wednesday, the Linux Foundation released a report titled Estimating the Total Development Cost of a Linux Distribution that shows just how valuable FOSS really can be, using the Fedora distribution of Linux and the Linux kernel itself as examples. (Disclosure: I am legal counsel to LF.) The effort is particularly interesting as the authors (LF’s Amanda McPherson, Brian Proffitt and Ron Hale-Evans) use the same methodology employed by respected industry expert David A. Wheeler in 2002 to value a related Linux Distribution (Red Hat 7.1). The run up in value wrought by six additional years of global collaboration is an eye popper.

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• Andy Updegrove

  

  Andy Updegrove is a partner and founder of Gesmer Updegrove LLP, a Boston-based technology law firm, and has represented and helped structure more than 80 worldwide standard setting, open source, promotional and advocacy consortia over the past 20 years. He has also represented hundreds of both emerging as well as established technology companies, and is the founder and editor of both the popular website http://www.consortiuminfo.org and the widely-read Standards Blog

• Karen Copenhaver

  

  Karen Copenhaver is a partner in Choate, Hall & Stewart LLP ‘s Business & Technology practice focusing on technology transfer and licensing of intellectual property with a specific emphasis on open source business models. Most recently, Copenhaver was executive vice president and general counsel at Black Duck Software, Inc.