I am still working my way through The Cathedral & the Bazaar: Musings on Linux and Open Source by an Accidental Revolutionary. As I fully anticipated there are numerous things in this book that speak to my ecclesial dream. I found the chapter, The Magic Cauldron, to be one of the best chapters in the book. I am going to comment on it in a later post but since it is available online I wanted to link to it. I think anyone who is thinking about church and the structures we use to sustain and support the business side of it needs to read at least this chapter. Here is one short excerpt:

Consumers lose because, even though software is a service industry, the incentives in the factory model all cut against a vendor’s offering competent service. If the vendor’s money comes from selling bits, most effort will go to making bits and shoving them out the door; the help desk, not a profit center, will become a dumping ground for the least effective and get only enough resources to avoid actively alienating a critical number of customers.

It gets worse. Actual use means service calls, which cut into the profit margin unless you’re charging for service. In the open-source world, you seek the largest possible user base, so as to get maximum feedback and the most vigorous possible secondary markets; in the closed-source you seek as many buyers but as few actual users as possible. Therefore the logic of the factory model most strongly rewards vendors who produce shelfware–software that is sufficiently well marketed to make sales but actually useless in practice.

The other side of this coin is that most vendors buying this factory model will also fail in the longer run. Funding indefinitely-continuing support expenses from a fixed price is only viable in a market that is expanding fast enough to cover the support and life-cycle costs entailed in yesterday’s sales with tomorrow’s revenues. Once a market matures and sales slow down, most vendors will have no choice but to cut expenses by orphaning the product.

Whether this is done explicitly (by discontinuing the product) or implicitly (by making support hard to get), it has the effect of driving customers to competitors (because it destroys the product’s expected future value, which is contingent on that service). In the short run, one can escape this trap by making bug-fix releases pose as new products with a new price attached, but consumers quickly tire of this. In the long run, therefore, the only way to escape is to have no competitors — that is, to have an effective monopoly on one’s market. In the end, there can be only one.

And, indeed, we have repeatedly seen this support-starvation failure mode kill off even strong second-place competitors in a market niche. (The pattern should be particularly clear to anyone who has ever surveyed the history of proprietary PC operating systems, word processors, accounting programs or business software in general.) The perverse incentives set up by the factory model lead to a winner-take-all market dynamic in which even the winner’s customers end up losing.

I see most of the current established churches structuring themselves in a closed-source system that is destroying all competitors and making it difficult for alternatives to be created. I strongly believe that if a sufficient network of open-source ecclesial dreamers find a way to connect with one another we can create an alternative that will expose this truth more clearly than any essay ever could. More on that later. in the meantime, if anyone has already read it or follows the link to this chapter I would love to hear your thoughts. Does any one else see any connection between The Magic Cauldron and the church that is emerging? Or is it just me?

Tags: "open source"

This entry was posted on Tuesday, October 25th, 2005 at 10:03 am and is filed under Everything Else.... You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.