Monetizing Open Source Software: Is It Possible?
Who doesn’t like free software, right? But it doesn’t mean it can’t get monetized.
I have a question. Who doesn’t like free software? Yes, really free software that anyone can use for life, as in free beer.
Nowadays, there are countless numbers of software on the web that can be downloaded and use immediately without paying a single dime. Also, since many of them are open-source, the source codes can be obtained through sites such as GitHub for free.
But, have you ever wondered how software developers make money out of it? Well, the truth is, not all of them are being monetized, especially for the open-source software.
If you think open-source software cannot be monetized and assumed that it’s always free, think again. Because here are the ways that open-source software can be monetized, which I explained below.
1. Opt for restrictive licensing
Compared to the public domain and permissive licenses which do not help much when it comes to setting the restrictions, a restrictive license allows the developer to put many restrictions at the same time.
In other words, if individuals or businesses want to use your software without restrictions, they need to request a new copy of the software from the developer himself or herself.
One of the examples of a commonly used restrictive license is the General Public License or GPL. It allows the software to be utilized, modified, and redistributed freely by anybody.
However, the GPL license has its disadvantages, and one of them is that there are way too many limits on what you can do with your own software. Plus, the terms are more stringent in the GPL license also.
By allowing donations for your open-source software, it enables to present appreciation from your users and that they are supporting your software development as well as future updates and the inclusion of new features if any.
However, it depends on how many users utilize your software. If your software hasn’t gained traction yet or not many people are using it, it’s harder to ask to make the donation. On the other hand, if your user base is large, then it is appropriate to ask for a donation for your software.
You can use platforms like Patreon or Donorbox to streamline the process of receiving the donations. If cryptocurrency is your jam, you can also accept cryptocurrency payments like Bitcoin by creating a Bitcoin address from scratch and share the address or QR code to the public. You can read more here.
3. Offer paid add-ons or professional services
Here’s how it works. You still offer your software for free, but you charge on additional services and other custom add-ons.
The services may include assisting in installing the software, integrating your software into a particular product or service, and extensions and plugins.
Take WordPress as an example. It is being used by two platforms, which are WordPress.org and WordPress.com.
WordPress.org is a free open source website publishing platform which is created by the community and is operated by the WordPress Foundation. Anyone can download the software free of charge, and then install and run it in a web host or local host on the PC.
Meanwhile, WordPress.com is the hosted version of the open-source WordPress software. A separate company called Automattic owns it, and similar to Squarespace and Wix, it lets anyone who lacks the technical knowledge to set up a website or a blog from scratch to sign up and start using it immediately.
Here is the difference. Anyone can download the WordPress software from WordPress.org, and install and run the instance on a web host or even local host in your PC without the Internet connection. At the same time, you are free to do the customization and also install plugins and themes as you please. You are in complete control of managing your own website.
On the other hand, WordPress.com comes with four plans, which are: free, personal, premium, and business.
The free plan has many limitations, such as using wordpress.com subdomain, limited storage, and inability to monetize the website. Such restrictions can be removed by purchasing any of the three premium plans.
The company that manages WordPress.com also offers plugins that are directly being used for WordPress.org installations. Examples are Jetpack, WooCommerce, Akismet, and Crowdsignal. Although most of the plugins are free to use, users need to pay to access additional features in them.
Just because a software is labeled as open-source does not precisely indicate that it is not allowed to be monetized in any way.
A software developer has the right to monetize their own software as long it follows the licensing rules, depending on which license they opt for.