However, an important concept associated with the open innovation paradigm is the significance of business model. Shafer defines business model as a “representation of a firm’s underlying core logic and strategic choices for creating and capturing value within a value network”. Specifically, the functions of the business model are to articulate the value proposition, identify market segment, define the structure of the firm’s value chain, specify revenue generating mechanism, define cost structure and formulate a competitive strategy. The importance of business model is that it serves as an intermediate link between the technical and economic domains....
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... GPL and use it without fees. However, they would have to pay a fee if they wanted a commercial version of the MySQL. Commercial MySQL software could be distributed with non-open source software, included a warranty from MySQL and came with a development support. MySQL used its open source status as a viral marketing vehicle to penetrate markets. It used the booming Internet successfully for marketing purposes. Also, it identified other players in the value chain and took part in the creation of the LAMP (Linux, Apache, MySQL, PHP) protocol, which soon became an acronym for coherent OSS building blocks. This is a how a successful business model enabled MySQL to derive profit from open innovation and enabled it to create value in the chain as well as to derive value for itself.
1. “My SQL Open Source Database in 2004” – Stanford Graduate School of Business
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