Open Source Software in the Software Market ---
An Agent-based Modeling Approach

    The prosperity of Open Source Software (OSS) has generated many interests and debates. Surrounding the Open Source phenomenon, there are four major issues that academic inquire gets involved in: motivation, collaboration, market effects and business models. The research presented here proposes an agent-based artificial market simulation model to investigate the performance of OSS in the software market and its possible consequences.
    While the fact that some OSS projects, notably Linux and Apache, have gained significant market share in competition with their commercial counterparts shows that OSS has good chances to succeed in the market; it does not necessarily lead to the dominance of OSS in software industry promised by proponents of OSS. The very future of OSS is still an open question, since uncertainty and competition in the marketplace pose real challenges. Our analysis on the nature of the software market suggests that coexistence of OSS and commercial software could be the most possible scenario and it works better for harvesting more innovation and productivity. For a single OSS project, furthermore, its market performance depends on its initially incremental development processes. An agent-based model is built to investigate such threshold effects and to verify above hypotheses about dynamics and consequence of software market after the entry of OSS. The basic scenario is a software market for similar software that seeks to accomplish the same function/functions and compete on price, features and attention of developers, to gain the same user target. The model explicitly considers the heterogeneous market and interaction between multiple agents: users, developers, commercial software packages and OSS projects. Finally, we conclude the implication of OSS for public policy and business operation.


Jing Deng
University of Michigan – Ann Arbor
School of Information
http://www-personal.si.umich.edu/~dengj/
dengj@umich.edu