Eller Research Examines How Acquisitions Impact Open-Source Software Contributions

Open-source software (OSS), which allows anyone to use and edit a program’s code, has grown in popularity and is now part of our daily lives. For instance, when you use Mozilla Firefox, you’re using OSS.

While much of the existing research on OSS focused on people’s incentive to contribute, a new paper by Assistant Professor of Management Information Systems Wei Chen explores the tie between companies and OSS.

“Now it’s not individuals that maintain a huge amount of open-source software. It’s companies,” says Chen.

Using data from Github, the SDC Platinum database and Crunchbase, the research digs deeper into what happens to OSS contributions when a larger company—like IBM—acquires a target firm that oversees many OSS projects—like Red Hat.

After a target firm is acquired, its internal employees decreased their contributions to its OSS projects; however, they increased their contributions to the acquirer’s OSS projects. The researchers found that such an acquisition results in more OSS contributions from external developers.

What’s more, the findings note that said acquisitions can encourage internal and external developers to contribute to other OSS projects, thereby benefitting the larger OSS community.

Chen highlighted a few large-scale implications from the research. First, acquirers will gain value from their own new employees as well as external contributors. Additionally, he had some advice for large companies: “If you want to maximize the value [of the acquisition], you may want to get some internal experience yourself in OSS.” They should properly prepare their internal infrastructure and processes, as well as the onboarding of new employees, Chen said.

Titled “Flourish or Perish? The Impact of Technological Acquisitions on Contributions to Open-Source Software,” the paper is forthcoming in Information Systems Research. It was co-authored by Fujie Jin at Indiana University and Ling Xue at Georgia State University.