Making Money In Open Source

So in the open source community the word "free" is used a lot, but it is a common misconception as to what "free" really means, does it mean free as in it doesn't cost anything or does it mean free as in freedom. Most open source projects it means both actually, but the word free means freedom. So this leaves a door open for making money, but how?

Well I'm going to discuss two potential ways, but understand that there are many more ways to make a business out of open source software. One of the most popular way to make a business out of open source software is to give the software away for free but sell support services on yearly basis. A perfect example of this Red Hat Inc., began it's business in 1995 selling support for the new released Red Hat Linux 2.0 and package manager called RPM. Now in 2010, the company is worth 7.8 billion dollars, not bad for a company that gives their software away for free and sells services like security patches and technical support.

Another way to make a business out of open source software is sell the software itself, but you have to provide the source code and give all the freedoms that are required under the whatever license you choose to use. This is a little more difficult because generally open source enthusiast don't like paying for software. iRedMail is great example though of an open source project that leverages both making money on software and giving the software away for free. This project is a complete email server based on other open source software packages. Then they decided to develop an administration panel and they sell this package. Now here is the smart part of this project, in order to use the email server you don't need to buy their administration panel in order to use the rest of open source project.

Now like I said these are only two ways to make money and a business out of open source software. It can be done and it is a viable business model, and it works well within the open source community model of freedom of software and the ability to modify software in order to best fit your needs. You would be surprised by how many members of the open source community who are willing to pay for software as long as they retain the freedom to do what they want with that software.