If Company X gains $1,000,000 savings due to investing $700,000 in developing a piece of software, they have earned $300,000. Then, they open source the software, and improvements to it by outside contributors result in them saving another $500,000.

Then, Company Y adopts the software and uses it to save $2,000,000. They improve it as well, which results in them saving another $500,000 and Company X saving another $300,000.

Total profit: $3.8m

Compare this to the alternative:

Company X gains $1,000,000 savings due to investing $700,000 in developing a piece of software, they have earned $300,000. Then, they keep the software closed. No contributions are made by outside users.

Then, Company Y writes their own version of the software for $700,000 and uses it to save $1,500,000, less because they don't have the improvements made by outside contributors. They don't have the logic from Company X to combine with theirs, so they don't improve it, and they don't save any extra money. Company X doesn't save money either, since they don't get anything back.

Total profit: $1.1m

Everyone involved made more money in the first situation than the second, despite Company X giving up their source code to be used by other companies as well. This works completely fine under existing systems and requires nobody to arbitrarily throw money at open source for no potential gain.

Open source is the free-market solution to the problem of inefficiency due to competition--everyone implementing their own versions of software and in the end generating a worse result than if they had worked together.