Open Source IS a business model
Analyst group 451 Group has a non-public report out titled, "Open Source is Not a Business Model." To put my views front and center - this report title is clearly an attempt to generate interest with what some might think of as a controversial view. I have somewhat different views than 451.
In a blog post by 451 Group analyst Matt Asslett he wrote that:
Open source is a business tactic, not a business model.
Open source is not a market in and of itself, nor is it a vertical
segment of the market. Open source is a software development and/or
distribution model that is enabled by a licensing tactic.
There is very little money being made out of open source software that
doesn't involve proprietary software and services.
There is also a move by some (governments and others) to specify open source software as part of the procurement process. I'd say that qualifies as a category.
Saying that open source is not a business model is sort of like saying that search is not a business model. Search itself (Google or otherwise) is of course a vehicle on which a business model can be built (in Google's case a very good one). The same is true for open source - it is the medium/methodology - on top of which money is made.
The fact that many open source vendors have a dual-licensing model should not be seen as a failure of open source to be a business model in and of itself which is kinda/sorta what 451 Group is implying. Every time I've ever spoken to any open source vendor with a dual license strategy the reason why they have one always has to do with choice and policies at the end user enterprises. Open source can co-habitate with proprietary solutions and the fact that the two can co-exist is a sign of strength not weakness and doesn't mean that open source is not the basis for a business model.
Understanding how to make money from open source software is an important thing and that's what I see as the key issue that needs to be understood. Understanding that it's a balance of open/closed and free/paid is critical to success. But that's nothing new is it? Hasn't Red Hat been grappling with that issue since its creation? Isn't Red Hat an Open Source vendor?