open source vendor

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A Consulting Firm Transition to Open Source Health Software (Part 2 of 2)

Andy Oram | EMR and HIPPA | September 7, 2016

The best hope for sustaining HLN as an open source vendor is the customization model: when an agency needs a new feature or a customized clinical decision support rule, it contracts with HLN to develop it. Naturally, the agency could contract with anyone it wants to upgrade open source software, but HLN would be the first place to look because they are familiar with software they built originally. Other popular models include offering support as a paid service, and building proprietary tools on top of the basic open source version (“open core”). The temptation to skim off the cream of the product and profit by it is so compelling that one of the most vocal stalwarts of the open source process, MariaDB (based on the popular MySQL database) recently broke radically from its tradition and announced a proprietary license for its primary distinguishing extension.

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The (Awesome) Economics of Open Source

Successful open source software companies "discover" markets where transaction costs far outweigh all other costs, outcompete the proprietary alternatives for all the good reasons that even the economic nay-sayers already concede (e.g., open source is simply a better development model to create and maintain higher-quality, more rapidly innovative software than the finite limits of proprietary software), and then-and this is the important bit-help clients achieve strategic objectives using open source as a platform for their own innovation. With open source, better/faster/cheaper by itself is available for the low, low price of zero dollars. As an open source company, we don't cry about that. Instead, we look at how open source might create a new inflection point that fundamentally changes the economics of existing markets or how it might create entirely new and more valuable markets.

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