# Our Open Source offering is a tier, not our competition

> Gain insight into FlowFuse's approach to its open-source tier versus paid offerings, and why it's a tier, not competition.

More than once we’ve been in discussion with prospective customers on what tier
is the right tier for their current Node-RED adoption. The question is likely to
come up "Why wouldn't we just use the open source version of FlowFuse?". The
implicit discussion created is one that is alike the question:
“Why wouldn’t we go with your competition?”. For FlowFuse, and most other open-core
companies like us, the open licensed and free to use core is tier, not competition.

In the traditional sense, the prospective customer is right. By the definition,
a customer **buys** goods or services by exchanging it for **money**. For
FlowFuse’s open-source edition, which is free as in beer and free as in speech,
no money changes hands. It can be installed and run by anyone. Once the software
is being installed and used, we consider we've gained a new customer.
There’s an agreement in place, the Apache 2.0 license, and value is obtained by
the customer. The only missing component compared to an ‘ordinary’ sale is the lack
of money from the customer to FlowFuse. The fact that no monetary value is exchanged,
like the situation where a customer picks the competitor, doesn’t make the open
source tier competition. It is just a free tier.

Another reason it's really a tier is that the core of the product is the same. In
many open-core products, the path to upgrade from the open source license product to
the paid tier is much alike customers are used to on SaaS models. In the reals of
self-managed software that's mostly uploading a license and  at times a few configuration
steps.

Furthermore, the open tier is a tier as the customer choses to not adopt all
capabilities. They're leaving value on the table. Either this is because it's not
quite clear what the value is or if  the higher tiers provides
enough business value to warrant the expense. Or the adoption journey for the
customer doesn't yet require the full featured tiers.

What’s unique about open source software, is that customers can exchange value
towards the company and community building the software in other forms: by
opening issues, updating documentation, advocating for the OSS variant, among
other ways. While this is not **money**, it is significant for a young company
like FlowFuse.

## Challenges with a open core free tier

That's not to say that an open source tier is a silver bullet for a company. For
one, it's hard to track how many users a software package has, and who these users
are. For example; FlowFuse has [Telemetry](/docs/admin/telemetry/#usage-telemetry),
though it can be turned off. Nor do we know who hosts this software.

Another challenge is around product and feature packaging. At FlowFuse and other open core companies it's
uncommon to move features from the open tier to paid tier only. If this choice has
been made it's a done deal, even when the product team got it wrong. Usually the
initial thoughts are therefor to move all features into the paid tiers. However,
this hampers long term growth as adoption of paid features are adopted later or
not at all. We follow the
[Open-Core buyer based model](https://opencoreventures.com/blog/2023-01-open-core-standard-pricing-model)
to segregate the value, about which I'll write a post next time.

Photo by [Matt Hardy](https://unsplash.com/@matthardy).