Adding to what k00b said, the open-source model is suitable for economically sustainable business if you use it essentially to make your product a standard and to make it easier to be tailored by the consumer. Then it can be so convenient that entire companies can develop around it. My golden example is Prusa, the 3D printer manufacturer, who made every single aspect of the product 100% open-source: both hardware and software. In doing so their designs became so ubiquitous that it became the de-facto standard, with all of the convenience that that brings with it in the technical world: abundance of both high quality documentation, experienced operators and higly knowledgeable communities. Calibration profiles are mercilessly battle tested so you can profit from infinite previous experience. And in any case, you're never locked to the vendor on anything: neither what you buy nor what you learn are vendor-specific. That did not but to allow a first niche to grow from tech-savvy people that in turn encouraged non-technical people to buy the machine directly from Prusa out of trust. The result has been a model to follow.

Now, it's not really an unexpected result. For example, the industry of flow-meter manufacturing is 100% standardized. It's not a law by any means, yet people do it anyways so to be fully compatible within the specific technical field. The standard is "open-source" in the sense that's freely available for everyone to be able to manufacture devices according to standard. Yet in despite of no intellectual property being possible there, the industry thrives. That's because, as k00b pointed out, profit is not in the standard itself (or "the code" if you will) but in the added value around it: manufacturing, calibration, assistance, etc.

If you think about your code as an ISO standard you can download from the web to use for a product, then you will always see if you're heading towards profit or not. If your project ends with the development of the standard (i.e. the code in itself), then you don't have a business model and will depend on charity.