Daniel Carrera posted the following email as a response to a new and interested user on an OpenOffice mailing list. It’s a succinct introduction and bears archiving here.
OpenOffice.org is free and will always be free. I’ll try to explain.
OpenOffice.org is “open source” software. Roughly speaking, this means that anyone can contribute to the software, not just one company. By sharing the workload among several companies and several volunteers, the cost of development is lowered significantly. This is the first step towards being able to provide it for free.
Sun Microsystems is the primary sponsor of OpenOffice.org. But there are others (Novell, Red Hat, etc) and a large group of volunteers. Each one gains something or another from contributing to this software. For example:
1) Sun Microsystems sells Solaris computers. OpenOffice.org makes those easier to sell. Sun also sells a commercial product called StarOffice which is based on OpenOffice.org.
2) Novell and Red Hat sell Linux distributions, as well as a suite of services for Linux. OpenOffice.org is a crucial component in making Linux desktops a high-value offer.
3) Some companies provide training services. For example, for companies that want to migrate to OpenOffice.org.
4) Some individuals are writers who sell books on OpenOffice.org.
Here you have 4 categories of people who financially gain from OpenOffice.org without actually selling it. You can see how these groups have much to gain from collaborating on a free office suite.
There are other reasons why one might contribute to an open source project:
1) Say you are a competitor of Microsoft. Half of Microsoft’s money comes from MS Office. By providing a lower-cost alternative, you make it harder for MS to charge its exorbitant prices. This is not a rare form of “competition.” Provide a cheap alternative to your competitor’s most lucrative line.
2) A lot of us are simply volunteers. For example, I am. OpenOffice.org is not simply a software product, it is a community. A lot of us work here on our spare time simply because the project is interesting.