Many of his designs were leaders in reducing costs of computer technologies for the purpose of making them available to large markets.

The Community Memory project, begun as a project of Resource One, Inc. in 1972 and later incorporated in 1977 by Felsenstein with Efrem Lipkin, Ken Colstad, Jude Milhon, and Mark Szpakowski, was one of the earliest attempts to place networked computer terminals in such places as Berkeley supermarkets to attract casual use by persons from all walks of life passing through and facilitate social interactions among non-technical individuals, in the era before the Internet.

These existed in a market space with early generation hobbyist microcomputers from Altair, IMSAI, Morrow Designs, Cromemco, and other vendors.

In 1998, Felsenstein founded the Free Speech Movement Archives as an online repository of historical information relating to that event, its antecedents and successors.

In 2003, while working with the Jhai Foundation of San Francisco, he designed an open-source telecommunications and computer system for installation in remote villages in the developing world.

This system was dubbed "the Pedal-Powered Internet" by The New York Times Magazine due to its reliance on pedal power generation.

Installation of the first system in Laos was unsuccessful, but the design has been tested on an Indian reservation in the US and continues in development in India.

Felsenstein is the Founding Sensei of the Hacker Dojo in Mountain View, California, and was featured on a Fox News segment in late 2009 covering the non-profit facility.