The penguin has entered the building: the commercialization of open source software products

Abstract

Previous literature on open source software (OSS) mostly analyzes organizational issues within communities of developers and users. This paper focuses on for-profit organizations that release software products under OSS licenses, and argues that variations in their endowments of intellectual property rights, namely patents and trademarks, help to determine which firms will tend to incorporate OSS into commercial products. We explain whether and under what conditions preexisting stocks of intellectual property rights can be useful complementary assets that allow firms to benefit directly or indirectly from commercializing OSS products, and test our hypotheses on a novel data set built on firms’ announcements of OSS product releases in the specialized press between 1995 and 2003. We find three robust results: (a) firms with large stocks of software patents are more likely to release OSS products; (b) firms with large stocks of software trademarks are less likely to release OSS products; (c) firms with large stocks of hardware trademarks are more likely to release OSS products.