Last month, my colleague, Zac Cherin, covered Tesla Motors CEO Elon Musk’s decision to share Tesla’s technology patents with its competitors. His analysis of the long-term benefits to Tesla — a new market for its batteries, potential allies in lobbying the government, and a chance to share the cost of expanding its supercharger network — over the short-term losses of an exclusive rights to technology was superb. But by far the most interesting aspect of Musk’s decision, which Mr. Cherin only briefly mentioned, is its implication for the technology sector and Silicon Valley.
Over the past several years, a number of analysts have described Tesla not as an automobile company, but as a technology company. This is due to the behavior of its share price — the dizzying roller coaster of TSLA, which accelerated last summer, more closely resembles the boom and bust cycle of Silicon Valley firms, rather than the slower, steadier movement of auto companies (like Ford (F) and Toyota (TM)). But this comparison is also due to the nature of Tesla’s product. Part of what has made the Model S one of the most popular electric cars in the country is its extensive use of technology, including cutting edge battery and charging equipment. As a spiritual descendant of the Silicon Valley, rather than Detroit, Tesla is building on a strong tradition in technology: free software.
Tesla’s decision to share its patents bears a striking similarity to the ideas behind the free software movement. The free and open-source software (FOSS) movements are dedicated to the idea that software should be “free” for users to modify and share. This does not necessarily mean that software costs nothing; the famous phrase by one founder of the free software movement, Richard Stallman, is software should be “free as in speech, not as in beer.” The focus on this definition of freedom, known as “libre” (as compared to free as in a “price of zero,” or “gratis”) has allowed for incredible achievements and advances in technology as developers—whether individuals working on personal projects, or huge corporations developing cutting edge technology — are able to build on the works of others.
While the free and open-source software movement has by no means ended copyright protection, of technology patents and proprietary (“closed-source”) software, it has led to great accomplishments by developers “standing on the shoulders of giants.” Free and open source software offers immense market penetration and is used globally. Such examples stem from programs, applications, and operating systems: web browsers Mozilla Firefox and Google (GOOG) Chrome, operating systems GNU and Linux, office software suites LibreOffice and OpenOffice, and media programs VLC Player and Foobar2000. Perhaps the most publicly well-known example of FOSS, created, maintained, and expanded through collaborative development and worldwide coding efforts, is the Android operating system.
Some free software purists might recoil in horror from the idea that Android is a truly “libre” platform, but the fact remains that much of the OS is derived from open-source software, including the Linux-based kernel. Consequently, Android is a relatively open platform, and allows everyone from phone manufacturers to members of the user community to modify the system to suit their needs. It also allows developers of applications more leeway.
While Tesla’s decision is unlikely to lead to this level of adaptation — for no other reason than that it is far simpler for end-users to make programming changes, or code additions, than to modify complex battery technology — it will allow professional automakers to experiment with, and build upon, Tesla’s work. And, as Cherin mentioned, it frees Tesla and its competitors from the bottomless pit that is intellectual property litigation.
Elon Musk cannot change the culture of the Silicon Valley on his own. But his willingness to release Tesla’s patents is a step in the right direction, and one that can only benefit his company, shareholders, and consumers in the long-run.