Currently, two models of innovation are prevalent in organization science. The "private investment" model assumes returns to the innovator result from private goods and efficient regimes of intellectual property protection. The "collective action" model assumes that under conditions of market failure, innovators collaborate in order to produce a public good. The phenomenon of open source software development shows that users program to solve their own as well as shared technical problems, and freely reveal their innovations without appropriating private returns from selling the software. In this paper, we propose that open source software development is an exemplar of a compound "private-collective" model of innovation that contains elements of both the private investment and the collective action models and can offer society the "best of both worlds" under many conditions. We describe a new set of research questions this model raises for scholars in organization science. We offer some details regarding the types of data available for open source projects in order to ease access for researchers who are unfamiliar with these, and also offer some advice on conducting empirical studies on open source software development processes. (Open Source Software; Innovation; Incentives; User Innovation, Users, Collective Action)  Open source software is software that is made freely available to all. Open source software development projects are Internet-based communities of software developers who voluntarily collaborate to develop software that they or their organizations need. Open source projects are becoming a significant economic and social phenomenon. Thousands exist today, with the number of developers participating in each ranging from a few to many thousands. The number of users of the software produced by open source software development projects ranges from few to many millions. Well-known examples of open source software having many users are the GNU/Linux computer operating system, Apache server software, and the Perl programming language. To set a context for exploring the interest that the open source software phenomenon can hold for organization science researchers, we begin by briefly explaining the history and nature of open source software itself (the product). Next we outline key characteristics of the open source software development projects typically used to create and maintain such software (the development process). In the early days of computer programming commercial "packaged" software was a rarity-if you wanted a particular program for a particular purpose, you typically wrote the code yourself or hired it done. Much of the software development in the 1960s and 1970s was carried out in academic and corporate laboratories by scientists and engineers. These individuals found it a normal part of their research culture to freely give and exchange software they had written, to modify and build upon each other's software both individually and collaboratively, and to freely give out their modifications in turn. This communal behavior became a central feature of "hacker culture." (In communities of open source programmers, "hacker" is a very positive term that is applied to very talented and dedicated programmers.) (Levy 1984) . In the 1980s this group received a major jolt when MIT licensed some of the code created by its hacker employees to a commercial firm. This firm, in accordance with normal commercial practice, then promptly restricted access to the "source code" of that software, and so prevented noncompany personnel-including MIT hackers who had participated in developing it-from continuing to use it as a platform for further learning and development. (Source code is a sequence of instructions to be executed by a computer to accomplish a program's purpose. Programmers write computer software in the form of source code, and also "document" that source code with brief written explanations of the purpose and design of each section of their program. To convert a program into a form that can actually operate a computer, source code is translated into machine code using a software tool called a compiler. The compiling process removes program documentation and creates a "binary" version of the program-a sequence of computer instructions consisting only of strings of ones and zeros. Binary code is very difficult for programmers to read and interpret. Therefore, programmers or firms that wish to prevent others from understanding and modifying their code will release only binary versions of the software. In contrast, programmers or firms that wish to enable others to understand and update and modify their software will provide them with its source code (Moerke 2000 , Simon 1996 .) Richard Stallman, a brilliant programmer at MIT's Artificial Intelligence Laboratory, was especially distressed and offended by this loss of access to communally developed source code and also by a general trend in the software world towards development of proprietary software packages and the release of software in forms that could not be studied or modified by others. Stallman viewed these practices as morally wrong impingements upon the rights of software users to freely learn and create. In response, he founded the Free Software Foundation in 1985, and set out to develop and diffuse a legal mechanism that could preserve free access for all to the software developed by software hackers. His pioneering idea was to use the existing mechanism of copyright law to this end. Software authors interested in preserving the status of their software as "free" software could use their own copyright to grant licenses on terms that would guarantee a number of rights to all future users. They could do this by simply affixing a standard license to their software conveying these rights. The basic license developed by Stallman to implement this idea was the General Public License or GPL (sometimes referred to as "copyleft"-a play on the word "copyright"). Basic rights transferred to those possessing a copy of free software include the right to use it at no cost and the right to study its "source code," to modify it, and to distribute modified or unmodified versions to others at no cost. Licenses conveying similar rights were developed by others, and a number of such licenses are currently used in the open source field. The free software idea did not immediately become mainstream, and industry was especially suspicious of it. In 1998, Bruce Perens and Eric Raymond agreed that a significant part of the problem resided in Stallman's term "free" software, which might understandably have an ominous ring to the ears of business people. Accordingly they, along with other prominent hackers, founded the "open source" software movement (Perens 1998). "Open source" software incorporates essentially the same licensing practices as those pioneered by the free software movement. It differs from that movement primarily on philosophical grounds, preferring to emphasize the practical benefits of such licensing practices over issues regarding the moral rightness and importance of granting users the freedoms offered by both free and open source software. The term "open source" is now generally used by scholars to refer to free or open source software, and that is the term we will use in the remainder of this paper. Recently, open source software has emerged as a major cultural and economic phenomenon. Today, the number of open source software projects is rapidly growing, with a single major infrastructure provider and repository for open source software projects, Sourceforge.net, listing in excess of 50,000 projects and more than 500,000 registered users. source software development practices that differ greatly from commercial software development models-and that look very much like the "hacker culture" behaviors described earlier. Because commercial software vendors typically wish to sell the code they develop, they sharply restrict access to the source code of their software products to firm employees and contractors. The consequence of this restriction is that only insiders have the information required to modify and improve that proprietary code further (see Meyer and Lopez 1995 , also Young et al. 1996 , Conner and Prahalad 1996 . In sharp contrast, all are offered free access to the source code of open source software. This means that anyone with the proper programming skills and motivations can use and modify any open source software written by anyone. In early hacker days, this freedom to learn and use and modify software was exercised by informal sharing and codevelopment of code-often by the physical sharing and exchange of computer tapes and disks upon which the code was recorded. In current Internet days, rapid technological advances in computer hardware and software and networking technologies have made it much easier to create and sustain a communal development style at ever-larger scales. Also, implementing new projects is becoming progressively easier as effective project design becomes better understood, and as prepackaged infrastructural support for such projects becomes available on the Web. Today, an open source software development project is typically initiated by an individual or a small group with an idea for something interesting they themselves want for an intellectual or personal or business reason. Raymond (1999a, p. 32) suggests: "Every good work of software starts by scratching a developer's personal itch too often software developers spend their days grinding away for pay at programs they neither need nor love. But not in the (open source) world " The project initiators also generally become the project "owners" or "maintainers" who take on responsibility for project management. 2 Early on, this individual or group generally develops a first, rough version of the code that outlines the functionality envisioned. The source code for this initial version is then made freely available to all via downloading from an Internet website established by the project. The project founders also set up mailing lists for the project that those interested in using or further developing the code can use to seek help, provide information, or provide new open source code for others to discuss and test. In the case of projects that are successful in attracting interest, others do download and use and "play with" the code-and some of these do go on to create new and modified code. Most then post what they have done on the project website for use and critique by any who are interested. New and modified code that is deemed to be of sufficient quality and of general interest by the project maintainers is then added to the "authorized" version of the code. In many projects the privilege of adding to the authorized code is restricted to only a few trusted "developers." These few then serve as "gate keepers" for code written by contributors who do not have such access (von Krogh et al. 2003). Most who download open source software are free riders-only a relatively small proportion contribute to a project by developing code or in other ways. Open source projects do not pay participants for their services, and the motivations and characteristics of contributors vary. Most are strongly motivated by a personal or business use for the code that they develop-they are code "users" in our terminology. Other major sources of motivation include intrinsic rewards such as personal learning and enjoyment from programming. Most contributors are experienced, professional programmers. Some act as independent individuals, others are employees of organizations that support their participation (Lakhani and Wolf 2001). Two brief case histories will help to further convey the flavor of open source software development projects. Apache Server Software. Apache server software is used on Web server computers that host Web pages and provide appropriate content as requested by Internet browsers. Such computers are the backbone of the Internet-based World Wide Web infrastructure. The server software that evolved into Apache was developed by University of Illinois undergraduate Rob McCool for, and while working at, the National Center for Supercomputing Applications (NCSA). The source code as developed and periodically modified by McCool was posted on the Web so that users at other sites could download, use, and modify and further develop it. When McCool departed NCSA in mid-1994, a small group of webmasters who had adopted his server software for their own sites decided to take on the task of continued development. A core group of eight users gathered all documentation and bug fixes and issued a consolidated patch. This patchy Web server software evolved over time into Apache. Extensive user feedback and modification yielded Apache 1.0, released on December 1, 1995. In the space of four years and after many modifications and improvements contributed by many users, Apache has become the most popular Web server software on the Internet, garnering many industry awards for excellence. Despite strong competition from commercial Raymond first began to puzzle about the e-mail delivery problem because he was personally dissatisfied with then existing solutions. "What I wanted was for my mail to be delivered on snark, my home system, so that I would be notified when it arrived and could handle it using all my local tools" (ibid., p. 31). Raymond decided to try to develop a better solution. He began by searching databases in the open source world for an existing, well-coded utility that he could use as a development base. He knew it would be efficient to build upon others' related work if possible, and in the world of open source this practice is understood and valued. Raymond explored several candidate open source programs, and settled upon one in small-scale use called "popclient." He developed a number of improvements to the program and proposed them to the then maintainer of popclient. It turned out that this individual had lost interest in working further on the program, and so his response to Raymond's suggestions was to offer his role to Raymond so that he could himself evolve the popclient further as he chose. Raymond accepted the role of popclient maintainer, and over the next months he improved the program significantly in conjunction with advice and suggestions from other users. He carefully cultivated his more active "beta list" of popclient users by regularly communicating with them via messages posted on a public electronic bulletin board set up for that purpose. Many responded by volunteering information on bugs they had found and perhaps fixed, and by offering improvements they had developed for their own use. The quality of these suggestions was often high because " contributions are received not from a random sample, but from people who are interested enough to use the software, learn about how it works, attempt to find solutions to the problems they encounter, and actually produce an apparently reasonable fix. Anyone who passes all these filters is highly likely to have something useful to contribute" (ibid., p. 42). Eventually, Raymond had arrived at an innovative design that he knew worked well because he and his beta list of codevelopers used it, tested it, and improved it every day. Popclient (now renamed fetchmail) became standard software used by millions of servers on the Internet. Raymond continues to lead the group of volunteers that maintains and improves the software as new user needs and conditions dictate. We propose that the practices of open source software developers and communities will be of interest to researchers working in organization science for two major reasons. First, open source software projects present a novel and successful alternative to conventional innovation models. This alternative presents interesting puzzles for and challenges to prevailing views regarding how innovations "should" be developed, and how organizations "should" form and operate. Second, open source software development projects offer opportunities for an unprecedented clear look into their detailed inner workings. By the very nature of the way these projects operate, detailed and time-stamped logs of most interactions among community members and of project outputs are automatically generated. These logs are publicly available and open to the inspection of any researcher without special permission. This simple fact makes open source software development projects valuable as research sites for many types of studies. In §2, following, we explore the general nature of the research opportunities that open source offers to those interested in organization science in general, and innovation models in particular. In §3 we offer a discussion regarding open research questions and the types of data available for open source software projects in order to ease access for researchers who are unfamiliar with these, and we offer some advice on the conduct of empirical studies on this phenomenon. Society has a vital interest in encouraging and rewarding innovation. Presently, there are two major models characterizing how this may be done. The first, the "private investment" model, assumes that innovation will be supported by private investment and that private returns can be appropriated from such investments (Demsetz 1967). To encourage private investment in innovation, society grants innovators some limited rights to the innovations they generate via intellectual property law mechanisms such as patents, copyrights, and trade secrets. These rights, in turn, assist innovators in getting private returns from their innovation-related investments (Arrow 1962 , Liebeskind 1996 , Dam 1995 In the private investment model, any free revealing or uncompensated "spillover" of proprietary knowledge developed by private investment will reduce the innovator's profits from its investment. It is therefore assumed that innovators will avoid such spillovers to the extent possible-although they will occur nonetheless (Audretsch and Feldman 1996 , Audretsch and Stephan 1999 , Harhoff et al. 2000 . At the same time, the monopoly control that society grants to innovators under the private incentive model and the private profits they reap represent a loss to society relative to the free and unfettered use by all of the knowledge that the innovators have created. Society elects to suffer this social loss in order to increase innovators' incentives to invest in the creation of new knowledge. The second major model for inducing innovation is termed the collective action model. This model applies to the provision of public goods, where a public good is defined by its nonexcludability and nonrivalry: If any user consumes it, it cannot be feasibly withheld from other users (Olson 1967, p. 14). The collective action model operates in science and elsewhere (e.g., Merton 1973 , Aldrich 1999 , Monge et al. 1998 , McCaffrey et al. 1995 , Coleman 1973 , Eyerman and Jamison 1991 , Hess 1998 , Melucci 1999 . It requires that contributors relinquish control of knowledge they have developed for a project and make it a public good by unconditionally supplying it to a "common pool." This requirement enables collective action projects to avoid the social loss problem associated with the restricted access to knowledge of the private investment model. At the same time, it creates problems with respect to motivating potential contributors to collective action projects. Because contributions to a collective action project are a public good, potential beneficiaries of that good have the option of waiting for others to contribute and then free-riding on what they have done (Olson 1967) . One solution to this problem is to supply some form of monetary or reputation or other subsidy to contributors to collective action projects to raise their level of motivation. For example, many societies provide monetary subsidies for basic research for this reason. The social structure of science itself then operates via norms of reciprocity and knowledge sharing among scientists to insure contributions to public goods are made, and to offer reputation-based rewards for good performance (Merton 1973 , Stephan 1996 . In the case of open source software development projects, we see an interesting compound of the private investment and collective action models of innovation. We term this compound the "private-collective" innovation model. In this model, participants in open source software projects use their own resources to privately invest in creating novel software code. In principle, these innovators could then claim proprietary rights over their code, but instead they choose to freely reveal it as a public good. Clearly, the net result of this behavior appears to offer society the best of both worlds-new knowledge is created by private funding and then offered freely to all. However, it also creates an intriguing puzzle. As Lerner and Tirole (2000) put it: "Why should thousands of top-notch programmers contribute freely to the provision of a public good?" Much of the research needed to answer that puzzle is yet to be done. Answering it will involve, we think, revisiting and easing some of the basic assumptions and constraints conventionally applied to the private investment and collective action models of innovation. In essence, we think that each of the two basic models-in an effort to offer "clean" and simple models for research-have excluded from consideration a very rich and fertile middle ground where incentives for private investment and collective action can coexist, and where a "private-collective" innovation model can flourish. We think this middle ground is where open source software projects in fact reside. The end result of exploring it will be, we think, a deeper understanding of a promising new mode of organization for innovation that can indeed deliver "the best of both worlds" to society under many conditions. In the remainder of this section we consider how open source software development practice deviates from the conventional assumptions of the private investment and collective action models of innovation. Then, we show how the conditions actually faced by open source software projects offer the basis for a novel, private-collective model for the motivation of innovation. Open Source Software Project Deviations from the Private Investment Model of Innovation Open source software development practice involves two major deviations from the private investment model of innovation as it is conventionally viewed. First, software users rather than software manufacturers are the typical innovators in open source. Second, open source innovators freely reveal the proprietary software that they have developed at their private expense. With respect to the first deviation, recall that the private investment model of innovation is premised upon the idea that individuals or organizations will step forward and invest in the development of innovations if and as they expect such action to "pay" in terms of private rewards. The model places no additional con-
Network members consider this reciprocal support as a "personal reward" that serves as an incentive for them to contribute more actively to the community REF ].
Open Source Software and the "Private-Collective" Innovation Model: Issues for Organization Science
Organization Science
Organization Science
Business Computer Science