Empirical analysis of hybrid open source software model: Determination of efficiency and governance

Over the past decade, open source software (OSS) projects underwent significant changes and restructuring, symbolizing venture from the original approach of producing open source code by volunteer contributors. The latest trend, which is fueled by commercial organizations, systems integrators, and IT vendors' interest in OSS, involves the joint collaboration between open and proprietary concerns. This study investigates the implications of a collaborative hybrid OSS development model from the perspective of the OSS project. By extending transaction cost economics and interorganizational cooperation frameworks to the OSS domain, the research investigates factors affecting network governance structure of this hybrid alliance. Theory predicts that efficient forms of collaborative transaction leads to perceived satisfaction with an alliance. The study examines factors that contribute to satisfactory institutional governance and underlying principles that influence OSS projects to engage in hybrid relationships with commercial partners. Moreover, the research identifies the necessary dimensions of interorganizational cooperation and safeguards, which minimize project's vulnerability to detrimental behavior by commercial partners. Data was collected across OSS projects to analyze the impact of commercial partners' involvement on project efficiency and governance. Results demonstrate that OSS projects seek to establish arrangements that give rise to atypical structure for efficient management of the development process. Results reveal that the formation of institutional establishment based on streamlined information flow, flexible non-formal relationship, collective collaboration responsibility, and moderation of influence effect give rise to a favorable form for governing transactions. The study also found that trust and branding play significant roles in reinforcing a thriving governance structure. Findings support the notion that hybrid projects achieve gains in product distinctiveness, yet collaboration is fragile to commercial parties' behavior of seeking self-interest. The emerging structure yields a perceived meritorious outcome for the OSS project; strongly suggesting that transaction cost efficiencies are realized. Practical implications for the study include identifying significant factors that contribute to OSS project efficiency and optimal governance, in addition to, establishing brand identity as a mutual benefit that binds the alliance. Hybrid OSS project success is largely dependent upon how well these factors are managed. The research fills a gap in empirical analysis of both OSS hybrid development model and OSS business model research.