10 tips on how to prevent business value risk
One category of risk that project teams need to ensure they address is business value failure – delivering a product that fails to provide value for the business investor.
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Open Source Business Models Debate: Create & Support vs. Pure-Support
Posted by Abhay Bakshi & Floyd Marinescu on Jun 20, 2007
Stormy Peters started off asserting that "Developers that work on open source software typically have day jobs that pay pretty well. So they work on open source software for free and write code during the day for big bucks." Ms. Peter's remark was in support of OpenLogic's Expert Community which compensates its participants roughly $100 per incident solved.
Rod Johnson called the idea that open source developers are evening volunteers a "years ago" notion, that citing JBoss, Interface21, Hibernate and Linux as examples:
"... [For Linux'] most code is generated by programmers punching the corporate time clock. About 1,000 developers contribute changes to Linux on a regular basis, Morton said. Of those 1,000 developers, about 100 are paid to work on Linux by their employersRod cites some Gartner stats that open source software sales will quintuple that of commercial license sales by 2011 to make the point that "unless there's a sustainable model behind open source for the long term, that's an awful lot of potential flaky software." Sustainability to Rod means not relying on volunteerism. Rod throws a number of other criticicms at OpenLogic's model, but the largest of which stemming from the key difference between their business models that Interface21 both develops and supports Spring, whereas OpenLogic just supports it. According to Rod:
We're talking about a rapidly growing part of the software industry that is mission critical. And [OpenLogics] model does not give anyone the ability to make a living from developing great software... You can't divorce the process of maintaining software from the process of creating software...That's not the future of enterprise open source - unless open source has no futureFor many of their customer incidents, OpenLogic claims that they get responses back from the developers (who signed up to troubleshoot and resolve customer problems) in 30-60 minutes; netting to $100-$200 per hour. Kim Weins from OpenLogic makes a comment that:
"... the model is already working. Open source developers have chosen to be members of the OpenLogic Expert Community. They have resolved issues and gotten paid. And customers have been happy with the results.Stormy Peters also challenged the idea that open source requires sponsors:
it sounds like you don't think open source will be successful if it stays in the "free" space. I would challenge that - many successful open source software projects don't have large corporate sponsors - take some of the Apache projects for example!Rod concludes the blog thread with the assertion that "enterprise open source requires the same quality of support as closed source products or it will not deliver real benefit to customers.
The number of companies doing the two models of professional open source in this debate are growing. On the 'creator' side we have companies like Mulesource (Mule), LogicBlaze (ActiveMQ/ServiceMix, recently bought by IONA), Mergere (Maven), and of course JBoss. On the pure certification/support side, enterprise demand for support is causing increasing VC investment in companies such as pioneers SourceLabs, SpikeSource, OpenLogic and others.
Is any one side really better than the other? What do you think? See also past related coverage by InfoQ "Marc Fleury on what makes open source business models tick".
ServiceMix a different model
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Bill Burke
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Re: ServiceMix a different model
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Przemyslaw Rudzki
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Re: ServiceMix a different model
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James Strachan
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Re: ServiceMix a different model
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Michael Neale
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Re: ServiceMix a different model
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Bill Burke
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Re: ServiceMix a different model
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Rod Johnson
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Re: ServiceMix a different model
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Steve Loughran
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ServiceMix is a different model than JBoss and Interface21. ServiceMix tries to monetize an Apache hosted project where JBoss and Interface21 host their projects themsleves. Huge difference. From what I heard, ServiceMix wasn't very successful as a business venture. Its obvious to me why this was the case. Brand is a cornerstone of OSS business, or for any business. When your project is hosted at Apache, Apache owns the brand.
I agree with Rod. Large customers that spend the big bucks want you to support a stable platform for 5 years. This just isn't going to happen with an OpenLogic model where they are relying on the community to support their platform. Communities have very short attention spans. An answer of "upgrade from version 1.x to 2.x" just won't cut for large corporate users.
Bill -
Currently, open source software is still gaining acceptance and understanding in the industry. People paying for the support (for example Linux distros) still tend to think in terms of license fees and they think in the "old way" that forced them to pay in order to get newer versions of the software that they have been using.
Once they will realize that this is not the case, they will ask themselves if they really need those 7 years of "certified" updates. Imagine: "Now everything is so agile. The companies that make software for us tend to deliver everything in short iterations. It is much easier to update platforms and libraries that we are using. Do we really need those x years of updates? What is the oldest system that we are using in the production? Can't we just take the newest version of the framework that is available for free anyway and pay skilled people to help us focus on the functionality?"
What I am trying to say is that I am not that convinced about the need to have such long attention spans.
/Przemek -
ServiceMix is a different model than JBoss and Interface21. ServiceMix tries to monetize an Apache hosted project where JBoss and Interface21 host their projects themsleves.
I don't really understand what you mean. e.g. drools is hosted at codehaus, hibernate & spring are hosted at sourceforge.
I think what you're trying to say is JBoss owns the trademarks of the open source projects? If so, yes sure you're right.
Huge difference. From what I heard, ServiceMix wasn't very successful as a business venture.
You heard wrong Bill!Its obvious to me why this was the case. Brand is a cornerstone of OSS business, or for any business. When your project is hosted at Apache, Apache owns the brand.
RedHat for example doesn't own the trademarks of all the open source projects it supports, nor does it host all the projects. Yet it still manages to make some money, from what I hear.
There are way more important things that whether or not a compnay owns the open source project trademark - like how good is a company at providing kick ass support for the customer? How open and active is the community behind the project etc?
I agree with Rod. Large customers that spend the big bucks want you to support a stable platform for 5 years. This just isn't going to happen with an OpenLogic model where they are relying on the community to support their platform. Communities have very short attention spans. An answer of "upgrade from version 1.x to 2.x" just won't cut for large corporate users.
Totally agreed. Though I don't see how this is related to which SVN repo the code lives :)
Incidentally quite a few of our customers have mentioned that to them one of the big reasons for going with an Apache based open source project is purely because they are not owned by a single commerical vendor, who may not be around in 5 years - or might all of a sudden change the license to some dodgy commercial restrictive or viral license.
James
Iona
Open Source the Enterprise Way -
Bill and I may not always agree, but we both represent companies who create a lot of software, and we're on the same page with this one. I should also point out that I think Marc Fleury was fundamentally right about this issue, and right about the fact that successful open source companies must be able to offer careers to open source developers.
Rgds
Rod -
Small point James, but Drools moved off codehaus along with the trademark when JBoss came along (so its SVN, website etc are all on Red Hat online properties now). I think similar happened with jBPM before it (but not hibernate, as you correctly point out).
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There are way more important things that whether or not a compnay owns the open source project trademark - like how good is a company at providing kick ass support for the customer?
Sure, kick ass support allows you to *keep* your customers. Doesn't do much to help you *find* your customers. -
I too agree that the openlogic plan is flawed. one of the big assumptions is that OSS developers will want to sign NDAs and field bugreps at $100/shot.
There is no way I could have a separate NDA for out of hours work, and although I do work on Ant as hobby, I reserve the right not to touch the codebase for weeks at a time. It's a spare time activity, and things like work deadlines, vacations, good mountain biking weather, family activities take priority. do I really want some customer sending me vmail for a $100 worth of support, especially once I convert to UK money and delete tax its down to 30 pounds.
At the same time, the jboss/redhat model, "own the contributors" doesn't scale. It doesn't work for those projects under not their direct banner (I know, you have a lot of the tomcat team, but there's enough oversight there that you cant always push it in the direction you want). It doesn't work for all those obscure little linux drivers a laptop needs, which are exactly the kind of thing that raise support calls in the enterprise. If redhat tried to fund development of all these little projects, they'd have the same R&D spend as microsoft, but with more competitive pressure on the pricing.
the challenge for bill and redhat is 'how to get those developers caring for redhat's problems'. I'm not convinced fedora is the solution, as its too unstable for me to use at work (and things like vmware aren't supported on it). And even though I can get RHEL5 at work, I dont want to have different home vs work desktops. Every developer who uses ubuntu is someone not aligned with Redhat's goals or release schedule, but they are at least not using windows....
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