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A Strategic Analysis of Competition Between Open Source and Proprietary Software

Author:

Ravi SenAuthors Info & Claims

Journal of Management Information Systems, Volume 24, Issue 1

Pages 233 - 257

https://doi.org/10.2753/MIS0742-1222240107

Published: 01 July 2007 Publication History

Abstract

This paper analyzes a software market consisting of a freely available open source software (OSS), the commercial version of this OSS (OSS-SS), and the competing commercial proprietary software (PS). We find that in software markets characterized by low direct network benefits, the PS vendor is better off in the presence of competition from OSS-SS. Furthermore, the OSS-SS vendor in these markets is better off by having lower usability than PS. Therefore, the PS vendor has little incentive to improve the usability of their software in these markets. On the other hand, in software markets characterized by high network benefits, a PS vendor is threatened by the presence of OSS-SS and can survive only if the PS is more usable than the competing OSS-SS.

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August TChen WZhu K(2021)Competition Among Proprietary and Open-Source Software FirmsManagement Science10.1287/mnsc.2020.367467:5(3041-3066)Online publication date: 1-May-2021
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https://dl.acm.org/doi/10.1287/deca.2019.0390
August TShin HTunca T(2018)Generating Value Through Open SourceInformation Systems Research10.1287/isre.2017.072629:1(186-205)Online publication date: 1-Mar-2018
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cover image Journal of Management Information Systems

Journal of Management Information Systems Volume 24, Issue 1

Number 1 / Summer 2007

349 pages

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Publisher

M. E. Sharpe, Inc.

United States

Publication History

Published: 01 July 2007

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Cited By

August TChen WZhu K(2021)Competition Among Proprietary and Open-Source Software FirmsManagement Science10.1287/mnsc.2020.367467:5(3041-3066)Online publication date: 1-May-2021
https://dl.acm.org/doi/10.1287/mnsc.2020.3674
Gao X(2020)Open Source or Closed Source? A Competitive Analysis with Software SecurityDecision Analysis10.1287/deca.2019.039017:1(56-73)Online publication date: 1-Mar-2020
https://dl.acm.org/doi/10.1287/deca.2019.0390
August TShin HTunca T(2018)Generating Value Through Open SourceInformation Systems Research10.1287/isre.2017.072629:1(186-205)Online publication date: 1-Mar-2018
https://dl.acm.org/doi/10.1287/isre.2017.0726
Olson DJohansson BDe Carvalho R(2018)Open source ERP business model frameworkRobotics and Computer-Integrated Manufacturing10.1016/j.rcim.2015.09.00750:C(30-36)Online publication date: 1-Apr-2018
https://dl.acm.org/doi/10.1016/j.rcim.2015.09.007
Gambardella ARaasch Cvon Hippel E(2017)The User Innovation ParadigmManagement Science10.1287/mnsc.2015.239363:5(1450-1468)Online publication date: 1-May-2017
https://dl.acm.org/doi/10.1287/mnsc.2015.2393
AlMarzouq MGrover VThatcher J(2015)Taxing the development structure of open source communitiesDecision Support Systems10.1016/j.dss.2015.09.00480:C(27-41)Online publication date: 1-Dec-2015
https://dl.acm.org/doi/10.1016/j.dss.2015.09.004
Li YTan CYang X(2013)It is all about what we haveDecision Support Systems10.5555/2747904.274824956:C(56-62)Online publication date: 1-Dec-2013
https://dl.acm.org/doi/10.5555/2747904.2748249
Temizkan OKumar RPark SSubramaniam C(2012)Patch Release Behaviors of Software Vendors in Response to VulnerabilitiesJournal of Management Information Systems10.2753/MIS0742-122228041128:4(305-338)Online publication date: 1-Apr-2012
https://dl.acm.org/doi/10.2753/MIS0742-1222280411
Cheng HLiu YTang Q(2011)The Impact of Network Externalities on the Competition Between Open Source and Proprietary SoftwareJournal of Management Information Systems10.2753/MIS0742-122227040727:4(201-230)Online publication date: 1-Apr-2011
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Singh PTan Y(2010)Developer Heterogeneity and Formation of Communication Networks in Open Source Software ProjectsJournal of Management Information Systems10.5555/2448790.244879827:3(179-210)Online publication date: 1-Jan-2010
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