Software Business Models

According to Microsoft (2003) three broad business models are adopted by software developer firms. These are: Open Source Software Model; Commercial Software Model and Hybrid Software Model. Each of these models has many sub-types which are based on the different influencing factors. Most of the software developers have traditionally adopted the commercial software model. In recent times due to the influence of open source initiatives both from governments and large firms the trend is shifting towards adoption of the hybrid software model. In the hybrid software model, software that has a higher intellectual involvement is offered under a commercial agreement while that with lesser intellectual involvement is offered under an open source agreement.