jimiyash:

There are lots of different business models for open source. Sometimes there is a free version and then a paid version such as sugarCRM. Other times, if the company is small, they may be able to survive on just donations. They might also have corporate sponsors that keep them in business. Other times, they offer the product for free and then just charge for support. Also if the product is open source, they don’t have to pay as much for developers because the community will upgrade and patch their products for a lot cheaper. Open source doesn’t always mean the software is free.

sanjay:

open source software is probably the most fulfilling way of earning a livelihood. Open source software philosophy thinks that the whole world is a big brotherhood, that every human being is a part of a big family therefore one brother does something for the family does it not for the sake of monitory benefit, as his needs are already taken care of by the family, so he does it out of his sheer joy of sharing with the family his skills, to show them what he is capable of and to make them smile, make them happy.

Rawlyn:

Mostly by donations or advertising, but a huge number of programmers working on open source programs are doing it for the fun of it, and do it in their spare time, not as their job.

Rawlyn.