Open Source Business Strategies Had A Bubble Too

Matt Asay points us to a fascinating paper (pdf) by Oliver Alexy of Technische Universitat Munchen (TUM) Business School, that looks at how the stock market reacts to companies that announce open-source software releases.

The paper looks at how stock prices move the day the news is released in an effort to gauge how Wall Street evaluates open-source-oriented business strategies. The study found a couple of interesting things. First Wall Street reacted positively to open-source announcements in 1999 and 2000, negatively in 2002-2004, and then positively again in the last couple of years. This suggests an open source bubble that coincided with the broader tech bubble. That was followed by a period of open source pessimism while the technology industry was in the doldrums. More recently, as open-source-related business strategies have matured, investor attitudes have become positive once again, and source code releases are rapidly becoming standard in some parts of the software industry.

http://www.techdirt.com/articles/20071023/154759.shtml