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Program encourages vendors to go open source

Mar 17, 20034 mins
Enterprise ApplicationsOpen Source

A think tank advocating the use of open source software in government has launched a source-code escrow program that would allow vendors to make money on proprietary software while eventually releasing their products to the open-source community. At least one software company said it might be open to the idea.

The Open Source Threshold Escrow Program would create goodwill for software vendors trying to sell products to government agencies and large companies afraid of proprietary vendor lock-in, said Tony Stanco, creator of the program, known as O-STEP.

Corel, which Stanco used as an example of a perfect fit for the program, said Monday it might consider such an idea for its WordPerfect Office suite. “It’s certainly an interesting proposal,” a company spokeswoman said after being told of the program.

Stanco explained O-STEP Monday at a conference in Washington, D.C., called Open Standards/Open Source for National and Local eGovernment Programs in the U.S. and EU.

Here’s how O-STEP would work: A vendor puts a piece of software in escrow with Stanco’s Center of Open Source and Government, based at George Washington University. The company determines a sales threshold that it wants to reach before the software is released under an open source license. After that threshold is reached the software is released as an open source product.

Stanco, founding director of the government open source center, promoted O-STEP as a balance between current copyright law, which gives software vendors longer-than-lifetime rights to their creations, and open-source licenses, which give programmers no period of control over their software.

“Even though open source is creating a lot of software, giving some incentive, I think, will get more open source software,” Stanco said. “That’s the theory, that the incentive structure is important.”

Open source advocates argue that the monetary incentive is not important for them; instead, the reputation they gain from creating freely distributed software is more important.

The foundation for copyright law is that producers should have monetary incentives to create, and Stanco admitted that “that’s probably more right than wrong.” Government agencies and large companies are scared of spending millions of dollars on software only to be locked into using that same vendor for years, he said, but the O-STEP program would allow the software they use to eventually be released as open source, allowing users to modify the software if they want to.

Stanco is counting on demand from government agencies, both in the U.S. and elsewhere, and Global 1000 companies to drive demand for the program. He hasn’t talked to any software companies about O-STEP yet, he said. The incentive for vendors to participate would come from a potential increase in sales from participating agencies and companies, and the opportunity to establish their products as a “defacto standard” through widespread use, he said.

“The purchasers are very excited about this,” Stanco said. “They don’t want to get locked in after they take the first step. The game is up for a lot of these proprietary software companies. The government is concerned, banks are concerned, insurance companies are concerned. You name it, anybody that has a big infrastructural (purchase) to make in the next few years, they’re very concerned that their first move might be the last one within their control.”

A good fit for the O-STEP program would be Corel, whose WordPerfect Office suite competes with Microsoft’s Office products. Corel could create new interest in WordPerfect by promising to release it under an open source license after the company achieves an agreed-upon level of sales, Stanco said.

“If (customers) put money into WordPerfect, they know in a few years it’ll be open source,” he added. “This gives companies like Corel another chance to become a standard.”

Stanco said he hasn’t approached Corel about O-STEP, but he’s hoping investors and customers of the company will pressure it to consider the idea. He’s begun floating the idea with customers and financial advisors, he added.

In O-STEP, the vendors are almost “irrelevant” and would not drive the program, Stanco added. Instead, if enough large government agencies and other software customers demand O-STEP, software vendors would have to play along. “I want the financial community to say, ‘You’re in a dead-end industry if you’re a proprietary company,'” he said. “The producers have too much power.”

Stanco, formerly a lawyer with the U.S. Securities and Exchange Commission, also started a company in March 2001 called, a cooperative of free software developers. The goal was to set up a business model in which programmers owned a part of the company, but the idea didn’t gain a foothold in the free software community.