• Employee Development
  • Digital Workplace
  • January 08, 2015

Open Source - the Generic Drug of the Software Industry

Generic drugs have similar effects as original drugs and pharmacies have the obligation to offer the cheaper generic drug option to the customers. Then why are the generic drugs cheaper than the original drugs? The answer is competition.

Due to the high development investments, it is justified to allow patent protection to new medicines. After the patent protections expire, it is possible to develop biologically equivalent drugs, i.e. generic drugs, in addition to the original drugs. This kind of openness equals competition, which again leads to a lower price.

Software development does not require similar investments as drug development. The software is protected only by copyrights. Closed development work is usually done by a single facet and the license fees are justified by the redemption of the development work. The code is protected by all the ways possible and the resources are spent for making sure that the outsiders cannot get their hands on the code structure.

The principle of the open-source is that the development work and the development tools are open, or even public in the best-case scenario. It is possible to develop and circulate the open-source code freely. Thus, open-source software is continuously developed in order to meet the users' needs. There is also a large community behind the development work, which ensures that the development costs are being shared.

There are still myths, for example about the information security and the legality of the procurements, around the open-source. Also, generic drugs have had their own difficulties. They used to be judged as unsafe copies. However, together with the legislation also the myths of generic drugs have changed. The same is about to happen to the open-source.

According to the law in Finland, it has been possible to substitute the recipe drugs with generic drugs since 2003. This has given the customers a chance to enjoy the lower price of the drugs. When it comes to competitive tendering, it seems that the competition legislation of the software industry still seems to be stuck somewhere in the '90s. Therefore, it can be extremely challenging to understand in a wider picture of what actually is the most cost-effective option. Unfortunately, the cheapest purchase price does not yet guarantee anything.  

Italy is working as a vanguard when it comes to the public sector software procurements and tenders. A guideline published at the beginning of 2014 obligates all the state organizations to favor open-source software. Also, in Finland, we have gradually started to understand the significant advantages and savings of using open-source in public governance.

Whenever acquiring new software, the similar purchase principle as when purchasing generic drugs should be applied: it should always be examined whether an open-source alternative is on offer. If possible, the option to acquire a cheaper option should be taken advantage of. When it comes to open-source solutions it is possible to enjoy the advantages developed by a wider audience. Moreover, it is possible to develop the solution further based on particular needs. Also, the usage of open-source is not restricted. Thus, it is possible to change the supplier or to take advantage of integration and expand to external programs.

Do you think a law initiative regarding the open source usage in the public sector should be placed? Join the discussion in Twitter @valamis

Janne Hietala, CCO, Valamis

Martin von Willebrand, Chairman, COSS (Centre for Open Systems and Solutions) and a partner, HH Partners Attorneys-at-law.