In this blog post, we will look at how the IT industry, which has been stagnating due to technological barriers, can drive new innovation and growth through open source.
With the exception of wearable devices, the growth of IT products has slowed down over the past five years due to a lack of new categories. The same is true for IT services. A representative example is mobile applications. In 2008, smartphones opened up a new software service category called mobile applications (hereinafter referred to as “apps”), but looking at the mobile app market today, there are many duplicate apps, and it is no longer easy to find popular apps such as Twitter and Facebook. So why are there no new services or product lines coming out anymore?
This is because of technological barriers. Even though it is possible to create new services with existing technology, most of the technologies on the market are not publicly available, making it impossible to utilize them. It is only possible by paying huge royalties or developing new technologies, but this requires significant initial costs, making it nearly impossible for startups and individual developers with ideas to jump in. I believe that the open source movement must become more active in order to overcome these technological barriers and re-ignite the explosive growth of the IT industry. Before explaining why, let’s first clearly define the open source movement.
The open source movement varies depending on the scope of information disclosure. The open source movement I am referring to is as follows. “1. Hardware: Circuit diagrams and reference materials are disclosed. 2. Software: Application Programming Interface (hereinafter referred to as API) is fully disclosed.” Reference materials refer to the theoretical explanation of how the functions provided by the hardware are implemented and how they are used, while API refers to the interface that controls the functions provided by the operating system or programming language so that they can be used in application programming. This is different from source code. For example, if you use a map API, you can create a program with functions such as searching for places and finding directions without knowing the source code for creating maps.
The reason I support the open source movement is simple. Open source has the potential to create new markets on a global scale. In fact, there is already an example of this in the creation of a large IT market. That is today’s software industry market. The programming language C, which created the software industry market in its early days, has a GPL license, which is a Copyleft (opposite of Copyright) license that was created with the intention of “freely sharing software.” With the explosive spread of personal computers (PCs), the software market also experienced explosive growth, which was made possible by the freely available C language. Languages derived from C, such as C++ and JAVA, also had open source licenses, and today most software is created using these languages, with the software market reaching $65.6 billion in 2012. In other words, programming languages were the most basic element of programming, but their disclosure led to the explosive growth of the IT industry. The disclosure of software APIs enables the efficient use of existing technologies, and as shown in the above example, the disclosure of APIs can open up new categories in the IT industry.
Let’s look at a slightly different example. There is an embedded board called Arduino. Based on the board’s easy and quick production and freedom of use, it is currently used for educational purposes, and circuit diagrams and reference materials are actively disclosed. Thanks to the well-disclosed reference materials, there are active forums, and idea development using Arduino is possible at almost zero cost. Therefore, people who come into contact with Arduino can actually create their ideas without being bound by profit. You can see that new IT-related ideas utilizing Arduino are exploding just by looking at Instructables and Kickstarter. Open source hardware provides opportunities to try out various ideas.
If we look at this process more closely, we can see something interesting. Arduino triggered the explosion of ideas, but the software base of Arduino is C++, which has a GPL license. In other words, the open source license of C++ was combined with open source hardware, leading to an explosion of ideas. Here, we can see that open source creates new open source, and as this process repeats itself, it leads to the realization of a wider variety of ideas without the need for ordinary people to worry about commercial purposes or profit structures.
Based on the above, open source may seem like the most desirable approach in the IT industry. However, in reality, proprietary licensed software dominates most of the software market. Why is that? If the open source movement is the most desirable approach, why doesn’t it seem to be very active now? Some may answer this question by citing profits as an example. Of course, this is the biggest reason. Proprietary licensed software guarantees a steady income, while open source software does not. Therefore, companies that need to pursue profits are hesitant to take the plunge. However, open source software has advantages that proprietary licensed software can never achieve, overcoming its disadvantages in terms of profitability. That is, it drives their existing revenue structure. Driving revenue means more than just making more money. It means that developers, users, and companies can become dependent on their services. If many companies, developers, and users become dependent on their services, it will be much easier to develop other services in the future.
A prime example is Google. Google is an advertising company. Interestingly, Google’s only source of income is advertising revenue. Google makes good use of the advantages of open source, with Android and Google Analytics being prime examples. Android released its API and announced it as open source software, so manufacturers do not have to pay royalties to use it. As a result, it has many users, with 84.6% of smartphone users worldwide using Android. Google receives vast amounts of information from Android users and uses it to provide customized advertising. The same is true for Google Analytics. Google Analytics provides smartphone application (hereinafter referred to as “app”) developers with an analytics API that allows them to see how their apps are being used worldwide. Information such as app operating hours, location, and usage patterns is sent to Google’s servers and provided back to developers in the form of graphs and analysis data. Google uses this information to provide customized advertising and analyze future service development trends.
In addition, there is a structure in place to generate revenue from open source itself, namely by providing consulting and solutions for open source developed in-house. No matter how open source the technology is, it is the developers and development companies that understand it best. In other words, if there is a problem with open source, they provide advice and solutions and generate service revenue. As mentioned above, open source itself can ensure the survival of a company and even has the advantage of solving the problem of illegal copying that can arise from exclusive licensing structures.
Due to the advantages of open source mentioned above, the open source movement is already gaining momentum in the software field. Portal sites such as Naver and Daum already provide open APIs for maps, encyclopedias, blogs, etc., and Twitter has released not only its API but also its source code for its source code error checker and real-time traffic processing technology. The number of developers utilizing these technologies is gradually increasing, and this will soon affect hardware as well. As the open source movement gains momentum in the future, the software and hardware markets will become a playground for new ideas, leading to the revitalization of the currently stagnant IT market.
