The True Cost of 'Free': How Open Source Sustains Itself

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No subscription fees. No usage limits. Full source code access.

Your finance team asks: "If it's free, who maintains it? What happens if development stops? Are we building on quicksand?"

Valid questions. Understanding how open source sustains itself helps you evaluate tool reliability and make better infrastructure decisions.

The Open Source Sustainability Crisis

The Problem: Uncompensated Labor

XKCD Comic #2347 (Dependency): A diagram showing modern digital infrastructure balanced precariously on a tiny block labeled "a project some random person in Nebraska has been thanklessly maintaining since 2003."

This isn't hyperbole. Real examples:

Heartbleed (2014):

• Bug in OpenSSL (used by 60% of web servers)
• OpenSSL maintained by 1 full-time developer + volunteers
• Annual budget: $2,000 (from donations)
• Bug exposed 500 million users to attack

Post-incident: OpenSSL received $3.9M in corporate funding. After the crisis, not before.

Log4Shell (December 2021):

• Critical vulnerability in Log4j (Apache logging library)
• Used by millions of applications globally
• Maintained by unpaid volunteers
• Response required: Emergency patches during holidays

colors.js and faker.js (January 2022):

• Developer intentionally broke popular npm packages
• Reason: Burned out from maintaining free software used by Fortune 500 companies
• Quote: "Respectfully, I am no longer going to support Fortune 500s with my free work."

The Numbers: Who Pays for Open Source?

Linux Kernel Foundation (2020 report):

• 70% of kernel contributors are paid by corporations
• Top contributors: Intel, Red Hat, Huawei, Google
• But: 30% still volunteer (unpaid)

Core Infrastructure Initiative study (2019):

• Analyzed thousands of critical open-source projects
• Finding: 60% have no commercial funding
• Median number of active maintainers: 2
• Median time since last commit: 12 months

The paradox:

• Global economy depends on open source
• Yet most maintainers are unpaid or underpaid

How Open Source Projects Sustain (7 Models)

Model 1: Open Core (Freemium)

How it works:

• Core product is open source (free)
• Advanced features require paid license
• Revenue funds development of both tiers

Examples:

GitLab:

• GitLab Community Edition (CE): Free, open source
• GitLab Enterprise Edition (EE): Paid, proprietary features
• EE features: Advanced security, compliance tools, premium support
• Pricing: $29-99/user/month (EE)

Mattermost:

• Mattermost Team Edition: Free, open source
• Mattermost Enterprise: Paid features (AD/LDAP, compliance exports)
• Pricing: $10/user/month (Enterprise)

Nextcloud:

• Nextcloud Community: Free
• Nextcloud Enterprise: Support + enterprise features
• Pricing: €1,900/year (50 users)

Sustainability: ✅ Strong (proven profitable model)

User concern: Feature split can feel exploitative if core product is crippled.

Model 2: Hosted SaaS (Convenience Model)

How it works:

• Software is 100% open source
• Company offers hosted version for convenience
• Self-hosting remains free
• Revenue from SaaS customers funds development

Examples:

Plausible Analytics:

• Plausible Community Edition: Free, self-host
• Plausible Cloud: Paid hosting
• Pricing: $9-149/month (based on traffic)
• Both versions use same codebase (no feature differences)

Ghost (blogging platform):

• Ghost open source: Free
• Ghost Pro: Hosted version
• Pricing: $25-199/month
• Same features in both versions

Discourse (forum software):

• Discourse open source: Free
• Discourse hosting: Paid managed service
• Pricing: $100-300/month

Sustainability: ✅ Strong (customers pay for convenience, not features)

User benefit: Can self-host to save money, or pay for managed service. Choice is yours.

Model 3: Dual Licensing

How it works:

• Software available under two licenses:
  1. Open source (GPL, AGPL) - free but copyleft
  2. Commercial license - paid but without copyleft restrictions

Example: MariaDB, MySQL:

• GPL license: Free, but derivative works must be GPL
• Commercial license: Paid, can embed in proprietary software without GPL requirements

Who pays:

• SaaS companies building on the software
• Enterprises wanting to avoid GPL obligations

Sustainability: ✅ Moderate (niche market, but lucrative)

Model 4: Support and Consulting

How it works:

• Software is 100% free and open source
• Company sells support contracts, training, consulting
• Professional services fund development

Examples:

Red Hat Enterprise Linux (RHEL):

• Based on open-source CentOS/Fedora
• Revenue: Support subscriptions ($349-2,999/year per server)
• 2021 revenue: $3.4 billion

Odoo (ERP system):

• Odoo Community: Free
• Odoo Enterprise: Paid (includes support)
• Also sells implementation consulting

Sustainability: ✅ Strong (for complex software requiring expertise)

Limitation: Only works for enterprise-focused tools. Consumer apps can't use this model.

Model 5: Donations and Sponsorships

How it works:

• Software is free
• Maintainers ask for donations (GitHub Sponsors, Patreon, Open Collective)
• No guaranteed revenue

Examples:

Mastodon (Twitter alternative):

• 100% open source and free
• Funded via Patreon: $30,000/month (2023)
• Lead developer works full-time on donations

curl (command-line tool):

• Maintained by Daniel Stenberg since 1998
• Used by billions of devices
• Funding: GitHub Sponsors (~$2,000/month)
• This is criminally underfunded for impact.

Sustainability: ⚠️ Weak (unreliable, depends on goodwill)

Reality: Most donation-funded projects barely pay maintainers minimum wage.

Model 6: Corporate Sponsorship

How it works:

• Corporation employs maintainers to work on open source
• Corp benefits from ecosystem around the software
• No direct revenue from project itself

Examples:

React, TypeScript, VS Code (Microsoft):

• 100% open source and free
• Microsoft pays core team
• Benefit to Microsoft: Developer ecosystem loyalty, Azure adoption

Kubernetes (Google):

• Developed and released by Google
• Google Cloud benefits from Kubernetes adoption
• Now governed by Cloud Native Computing Foundation (vendor-neutral)

Sustainability: ✅ Strong (while corporate interest remains)

Risk: If corporate sponsor loses interest, project can be abandoned.

Model 7: Volunteer Labor (Hobby Projects)

How it works:

• Maintainers work on project in spare time
• No monetization strategy
• Labor of love

Examples:

• Thousands of small utilities, libraries, scripts
• Often critical dependencies (see Heartbleed, Log4Shell)

Sustainability: ❌ Weakest (burnout inevitable)

The tragedy: Most critical infrastructure relies partly on this model.

Evaluating Open Source Project Health

Red Flags (Avoid These Projects)

1. Single maintainer + no funding

• Risk: Maintainer burnout or life changes → project abandoned
• Example: left-pad incident (2016) - developer removed 11-line package, broke thousands of projects

2. No commits in 12+ months

• Risk: Project likely abandoned
• Check: GitHub repository commit history

3. Unanswered issues and PRs

• Risk: Maintainers overwhelmed or disengaged
• Check: Issues tab, response times

4. Corporate ownership with declining interest

• Risk: Company may sunset project
• Example: Google graveyard (Reader, Inbox, etc.)

5. Complex dependencies with no funding

• Risk: Critical component maintained by volunteers
• Check: Dependency tree, funding sources

Green Flags (Healthy Projects)

1. Clear funding model

• Open core with paying customers
• SaaS revenue
• Corporate sponsorship from multiple companies

2. Active development

• Regular commits (weekly or monthly)
• Recent releases (quarterly or more frequent)
• Security patches applied quickly

3. Multiple core maintainers

• Bus factor > 1 (project survives if one person leaves)
• Diverse contributor base

4. Transparent governance

• Clear decision-making process
• Foundation or neutral governing body (Apache, CNCF, Linux Foundation)

5. Commercial ecosystem

• Companies offering support/hosting
• Proof: Market validates project's value

Case Studies: Success and Failure

Success: Discourse

Model: Open core + SaaS hosting

Journey:

• 2013: Launched as open source forum software
• Funded by: Investors + SaaS revenue
• Self-hosting: Free (Docker deployment)
• Hosting: $100-300/month
• 2023 revenue: Estimated $10-15M/year

Why it works:

• Product is genuinely useful (replaces phpBB, vBulletins)
• Self-hosting option builds community and trust
• SaaS tier provides reliable revenue
• Active development (weekly updates)

Outcome: Sustainable, profitable, growing

Mixed: WordPress

Model: Open source + commercial ecosystem

The complexity:

• WordPress core: 100% free, maintained by Automattic + community
• Automattic (company): Revenue from WordPress.com (hosted version)
• Ecosystem: Thousands of paid themes, plugins, hosting companies
• Controversy: Automattic controls .org (nonprofit) AND .com (for-profit)

Sustainability: ✅ Strong (complex but working)

Concerns: Power concentration in Automattic creates tension

Failure: CentOS

What happened:

• CentOS: Free rebuild of Red Hat Enterprise Linux (RHEL)
• 2014: Red Hat acquired CentOS
• 2020: Red Hat announced CentOS would become "CentOS Stream" (upstream of RHEL, not downstream)
• Impact: Millions of users lost stable, free RHEL clone

Why it failed users:

• Corporate owner changed project direction
• Community felt betrayed
• Alternative (Rocky Linux) emerged from community

Lesson: Corporate-controlled open source can shift against users.

How to Support Open Source Sustainability

As a User

1. Pay for what you use (even if free)

• Use hosted SaaS version if available (funds development)
• Buy support contracts if offered
• Sponsor on GitHub Sponsors, Open Collective

2. Contribute non-financially

• Report bugs with detailed reproduction steps
• Submit documentation improvements
• Answer questions in forums/Discord

3. Avoid "tragedy of the commons"

• Don't treat free software as a right
• Recognize it's a gift that requires reciprocity

As a Company

1. Budget for open source

• Allocate 1-5% of software budget to OSS sponsorship
• Sponsor projects you depend on
• Example: Facebook sponsors React, Webpack, Babel

2. Contribute developer time

• Allow employees to contribute to OSS during work hours
• Hire maintainers of critical dependencies
• Example: Microsoft employs TypeScript core team

3. Pay for Enterprise tiers

• Don't use Community Edition when you can afford Enterprise
• Enterprise revenue funds free tier development

The Future of Open Source Sustainability

Emerging Models

1. Open Source Foundations

• Projects join foundations (Apache, CNCF, Linux Foundation)
• Foundation provides: Legal protection, funding, governance
• Examples: Kubernetes, Prometheus, Node.js

2. Tidelift (Managed Open Source)

• Company pays Tidelift subscription
• Tidelift distributes funds to maintainers of dependencies
• Also provides security audits, compliance support

3. GitHub Sponsors

• Direct funding from users to maintainers
• Lower barrier than traditional donation platforms
• Integrated into developer workflow

4. Open Source SaaS Hybrid

• 100% open source
• Company offers managed hosting
• Self-hosting remains free (no feature split)
• This is most user-friendly model

Predictions (2026-2030)

More corporate funding:

• Companies realize OSS is critical infrastructure
• More will employ maintainers directly
• Alternative: Risk catastrophic failures (Log4Shell-scale)

Consolidation:

• Successful OSS projects get acquired
• Some will be killed (Google pattern)
• Others will thrive with resources (GitHub/Microsoft pattern)

Professionalization:

• Volunteer-only projects decline
• Paid maintainers become norm for critical software
• Higher quality, better security

The Exit-Saas Perspective

"Free" open source isn't free. Someone pays:

1. Volunteer maintainers (with their time)
2. Companies (via salaries, sponsorships)
3. SaaS customers (who fund development)

When you self-host open source, you benefit from:

• Decades of collective engineering effort
• Security reviews by thousands of eyes
• Features built by community needs (not profit motives)

Ethical self-hosting:

• Recognize the gift you're receiving
• Support projects financially when possible
• Contribute back (code, docs, sponsorship)
• Choose projects with sustainable funding models

The bargain: Self-hosting saves you money. Reinvest 10% of savings into the ecosystem that makes it possible.

Browse our tools directory with funding transparency for each project listed.

The future of open source depends on users who understand: Free software has a cost. Let's share it fairly.