Introduction

A few years ago, American Express started running a campaign ‘What can OPEN do for your business?’ Over the last few week’s I’ve been thinking about what I think is a more interesting question: How would an open ethos reinvent your industry? Specifically, I’m interested in looking at the ways that new entrants into a marketplace who take an open approach have changed industries.

What do I mean by ‘open ethos’

Wiktionary defines ethos as

The character, or fundamental values of a person, people, culture, or movement.

The most appropriate definition of open from Wiktionary is

Which is not closed; accessible

Therefore, for the purposes of this two-part post, I would define open ethos as an organization embracing accessibility as an fundamental value.

Interestingly, it seems like new entrants to the market with an open ethos have reinvented a number of industries. In the first part of this two-post series, I’ll focus in-depth on two examples where new entrants to the market have placed a higher value on being open. (I’ll also just link to a few other examples that I find illustrative.) In each case, you’ll see the organization has catalyzed significant change in their industries. In the second post, I’ll focus on a few generalizations that I think can be learned from the examples and point to a few industries that I believe are very vulnerable to being reinvented by embracing a more open ethos.

NOTE: This is more of an ‘think out loud’ series of posts, then one that I start knowing a specific conclusion I hope to reach. Therefore, I’d especially be interested in other people’s opinion on the topic - please leave comments below.

Open Source Software

I’ll start with reviewing the keystone example, open source software. The entire software business has been changed significantly because of business models that have sprung up around open source software. Interestingly, while some businesses have been effected negatively, there are a number of new business models that have emerged. There is an excellent book by O’Reilly that came out in 1999, “Open Source: Voices from the Open Source Revolution” it included an essay by Robert Young one of the founders of Red Hat.

Robert states:

You can’t compete with a monopoly by playing the game by the monopolist’s rules. The monopoly has the resources, the distribution channels, the R&D resources; in short, they just have too many strengths. You compete with a monopoly by changing the rules of the game into a set that favors your strengths…

The benefit an open-source OS offers over the proprietary binary-only OSes is the control the users gain over the technology they are using. The proprietary OS vendors, with their huge investment in the proprietary software that their products consist of, would be crazy to try and match the benefit we are offering their customers, as we generate a fraction of the revenue per user that the current proprietary OS vendors rely on.

In 1999 when Robert’s essay was written, Linux was just emerging in the operating system market. At the time there were about 10 million users compared to 230M Dos/Windows users. Looking back it is interesting to see how insightful this essay was. Today Linux is an established player, a recent Information Week article stated “a third of respondents to InformationWeek’s most recent IT priorities survey have Linux servers on their 2007 project lists–and it’s generating increasing interest as a PC operating system, partly as an alternative to Windows Vista.”

There are obviously a number of other very succesful open source project, but that is outside the scope of this essay. If you need help figuring out what those projects are - go to SourceForge.

Open Publishing

The entire idea of collaboratively developing material in wiki pages is an excellent example of a publisher (in the broadest sense of the term ‘publisher’) embracing an open ethos. The largest example of this is obviously Wikipedia, which describes itself as:

Wikipedia is an encyclopedia collaboratively written by many of its readers. It is a special type of website, called a wiki, that makes collaboration easy. Many people are constantly improving Wikipedia, making thousands of changes an hour, all of which are recorded on article histories and recent changes. Inappropriate changes are usually removed quickly, and repeat offenders can be blocked from editing.

In a debate in the Wall Street Journal Online about a year ago between Jimmy Wales (founder of Wikipedia) and Dale Hoiberg (editor-in-chief of Britannica), Jimmy was quoted as saying:

The main thrust of our evolution has been to become more open, because we have found time and time again that increased openness, increased dialog and debate, leads to higher quality. I think it is a misunderstanding to think of “openness” as antithetical to quality. “Openness” is going to be necessary in order to reach the highest levels of quality.

Britannica has long been a standard bearer, and they have done a fine job within their model. But it is time to work in a different model, with different techniques made possible by new technologies but the same goals, to reach ever higher standards.

While Wikipedia is a non-profit, interestingly Jimmy Wales recently started a new for-profit venture called “Wikia.” You can learn more about the project by reading it’s home-page - constructed by the community. Another recent interesting example is being led by Jay Rosen called “Assignment Zero” which is putting together a new very interesting twist on this now. Check out a description by Jay in Wired there is also a good summary by Jeff Jarvis.

This is a model that is clearly beginning to disrupting the way content is produced - similar to how open source disrupted the software industry.

A Few Other Examples

The following are a few other examples that I find pertinent:

• Online Classified Advertising - Craiglist
• Scientific Publishing - Science Commons
• Tech Events - Bar Camp
• Online Identity Management - OpenID (hat tip to my colleague John for thinking of this one.)

Next Post

Wow, so this was certainly a LONG first post! In the second (hopefully shorter!) half, I’ll explore the unique characteristics that open ethos projects have and some other industries that my be vulnerable.