Archive for May 2009
This coming Friday I will be on the Frugal Friday Show – http://www.frugalfridayshow.com talking about open source-related stuff.
The show starts at 6:30 Eastern and I’ll be on at 7pm. I am looking forward to it, should be fun.
You can listen online – http://www.blogtalkradio.com/frugalfriday
Jay Lyman at the 451 Group put out a post yesterday – Microsoft realigning closer to open source
I usually agree with Jay’s take on thing but not this time.
You can read my full take on Microsoft’s strategy in this post – Microsoft’s open source strategy
Microsoft and the Linux Foundation are aligned against a common enemy in the American Law Institute, it does not change anything between Microsoft and Linux or open source.
Microsoft learned 10 years ago that it is counter-productive to market against open source. Jay is correct that Microsoft is not targeting open source, instead they are targeting the users of open source (like TomTom). They can’t scare open source (code) into paying Microsoft, but they can scare users into doing that.
Microsoft’s ideal situation is for us to either pay to use their software, or pay to use a licensed open source product that pays royalties to Microsoft. The Novell deal is a good example of the latter, and now TomTom. I don’t think Microsoft is trying to ‘hurt’ open source. I think they are trying to find ways to get open source users to pay license fees to Microsoft (by asserting IP violations). That way Microsoft gets paid either way – revenue goes up but sales/marketing expenses stay the same.
Jay says that Microsoft has not made any IP accusations for ‘quite some time’. The TomTom suit only started 4 months ago and ended in March. That is a very short time in legal circles. I think it is very premature to say that Microsoft has abandoned a strategy they spent 10 years building up.
Codeplex does contain some Microsoft code, but nothing core that I could find. For example, from the wording, the Silverlight Toolkit seems to be developed by Microsoft but – ‘CodePlex is hosted by Microsoft. Microsoft does not control, review, revise, endorse or distribute the third party projects on this site.’
What’s worse Microsoft’s ‘shared source’ is for reference only. If you happen to copy any code fragments from it you could be facing a legal battle – ‘You are warned that when you build a run-time image based on an OS design that contains shared source code, your run-time image might contain private code that cannot be released in a product under the terms of the Microsoft EULA’
Microsoft is certainly changing. A few years ago they did not have a discernible open source strategy (but I think they were working on it for years). Since then they have made their strategy known and they started to execute on it (Novell, TomTom). I see no evidence lately that they have given up that strategy. So I expect that we will see more IP-based legal cases against the users of open source.
ZDNet’s Dana Blankenhorn did a post recently about potential changes in the European Union’s procurement process for software – Will European rules impact open source business models? This is an interesting topic.
NOiV, the Dutch national resource center on open source has identified some of the issues in the current procurement process. Rishab Aiyer Ghosh from the United Nations University created a good presentation on the topic: OSOR Guideline on Public Procurement and Open Source Software In it he lists several problems with the current processes including tenders requesting a specific vendor’s technology.
One problem not listed is the cost of tendering. The tendering process is long and expensive for a vendor, in many cases it involves filling out huge RFPs and flying people in to sell and ‘hand-hold’. If you tender for a government project and don’t get the deal, you have to recoup the money you wasted from somewhere else. What governments don’t realize is that when they buy proprietary software the money is recouped from them. All proprietary software companies build the cost of these failed sales attempts into their license fee. As a consumer you are not only paying for the cost of selling to you, you are also paying for a percentage of the cost of failed sales.
Governments are interested in using more open source and commercial open source software because they are expecting a cost reduction. The problem is that they do not seem to understand where this cost reduction comes from.
When you compare proprietary and open source software:
- Proprietary software has an up-front license fee. The revenue from new licenses is mainly used for sales and marketing expenses. Typically sales and marketing expenses are about 70-100% of the license revenue. In other words the license fee pays for the cost of selling software to the consumers.
- Commercial open source (whether pure-services, open-core, or gatherer model) does not have an up-front license fee. With these models the openness, transparency, and distribution mechanisms enable a mass-marketing or no-marketing approach to be used. The basis for this is that the consumer is able to prove to their satisfaction that the software does what they need – they don’t need anyone to sell the software to them.
According to the European Union procurement directives, any paid services related to software need to go through their tender processes. So any commercial open source company tendering is expected to undergo this expensive process. But open source and commercial open source software has no license fee, so there is nowhere to bury this cost.
This creates a illogical system. Governments want a cheaper product but have a process that is still expensive to participate in. It’s like asking for a cheap 5-star hotel. Either:
- You want the vendors to hand-hold and nurse you through the tendering process and will accept that they are going to charge you for this.
- You want a lower priced product and are willing to participate in a process where you prove that the software does what you need.
You cannot have it both ways.
Over the past few months I have been mentoring two students, Zueber Juma and Tej Amin, from Lake Highland Preparatory School. They have been working on a science fair project related to OpenMRS and the PEPFAR aids relief program using Pentaho’s technology. They set out to prove that medical record data from OpenMRS can be transformed using open source software into data structures that can be used to create PEPFAR reports. This system would allow AIDS treatment centers to create their own reports, instead of sending their data to the USA for report preparation.
They placed second at the country and state level and are now in Reno for the Intel International Science and Engineering Fair.
Good luck guys.
Every once in a while I get a feeling that one of the things holding open source / free software back is the people who believe in it the most. Today is one of those days.
I love open source. I think open source is the best and most efficient way to create software. I believe that in the future the majority of software will be open source. I believe that future is getting closer little by little. But it is still a long way off. I cannot envision a future where all software is open source, at least not in any time-frame that makes it worth thinking about. If you want a future where all or most software is open source you need to accept that businesses large and small must be able participate – and by participate I mean use, create, and make money from open source. Not only should businesses be able to participate, they should be more successful when they do. There is no possible future where open source is predominant and, at the same time, businesses cannot participate.
Open source is very well established in some software domains today. But the roots of the open source movement go back 20-30 years. The rise and adoption of open source has been unstoppable in numerous markets, but it has also been slow and gradual. The adoption of open source operating systems has been slow and gradual. The adoption of open source databases and middleware has been slow and gradual. The adoption of open source applications has been slow and gradual. Look at the adoption of Linux, or Firefox, or OpenOffice, or MySQL – steady and unstoppable, but gradual in every case. Open source has been around a long time, and adoption is ever increasing – we are in a world that is more receptive to open source every day. This is clearly an evolution – any revolution that takes over 20 years is pedestrian by any measure.
Given that we are evolving gradually and that businesses must be able to participate, here is my issue today. We are at a point where one of the world’s largest software vendors (Oracle) is suddenly going to hold some major open source cards (MySQL, OpenSolaris, Java etc). Is this part of the forward evolution? Or is this a set back? Here are two extreme outcomes:
Extreme Outcome #1: Oracle has a great experience with its new open source portfolio. Oracle becomes a true believer. Oracle starts to build new open source software or open source its existing applications one by one. Everyone sees the success Oracle is having with open source. This forces their competitors to create open source offerings. It encourages other companies to create or acquire open source software. It encourages the VCs to fund more open source startups. It encourages more startups to use an open source model. The amount of open source software increases and the percentage of proprietary software in the world decreases. The rate of open source adoption increases.
Extreme Outcome #2: Oracle has a really bad experience with its new open source portfolio. All the projects get forked, even before the deal is formally signed. The employees are actively lured away from Oracle. Everyone that can, clusters around the forks. Oracle gets zero revenue and no community traction. The open source pieces of the Sun deal turn out to be worthless. Everyone sees this. All big software companies assume that acquiring open source companies is really hard. Oracle is one of the best when it comes to buying companies: if Oracle can’t make it work, no-one can. Big companies stop acquiring open source companies. Big companies don’t consider open sourcing their products. Without the possibility of an acquisition,VCs are hesitant to invest in open source startups. Without funding startups choose the safer option – proprietary software. The amount of proprietary software rises, the rate of open source adoption lowers.
I am not a great fan of Oracle. My initial reaction to the news of the Sun acquisition was negative. But if you are a fan of open source Extreme Outcome #1 has to be the better one.
Look at the groups and individuals that are creating alliances, and forks, and protesting against Oracle. Ask yourself what their motivation is. Is it for the long term benefit of open source – or the short term benefit of themselves? Many of the companies involved are MySQL or Sun partners who think they won’t be able to compete with Oracle’s existing partners. They are just looking after the interests of their shareholders. Their actions have nothing to do with open source, nor should they be. They are entitled to act in their own interest. I believe they are not acting in the best interests of open source, but many people seem to assume that they are.
Are you are an open source advocate who has no direct involvement with MySQL or Sun? I encourage you to step back and look at the big picture. Think about the future you want and how we can get there. Make up your own mind. Before you cheer for the alliances and the forks, ask yourself if you are acting in the best interests of open source.
The Software & Information Industry Association has given SugarCRM Professional an award for ‘Best Open Source Solution’ in their 2009 CODie Awards. Either the name of the award or the criteria for it are wrong.
I could see SugarCRM Professional getting ‘Best Commercial Open Source Solution’ or ‘Best Product Based on an Open Source Core’. I could also see their community edition getting an open source award. But the professional edition getting an open source award is off the mark. My guess is that the SIIA are a little new to the whole open source / commercial open source thing.
Nice to see Adaptive Planning get an award, I’ve met those guys a few times. They got an award for ‘Best Business Intelligence or Knowledge Management Solution’, which is odd for a budgeting and planning application, but well done anyway.
As I mentioned in the forking protocol post there are different reasons why forks occur. One way to categorize forks is by looking at who is/are the main drivers of the fork.
In general there are two groups of people who might drive a fork: the community (external) and the core developers (internal). They have different reasons and motivations.
A fork driven by the community often occurs because of a lack of transparency or openness. The community, unable to get patches or new features or information (like the roadmap), create a fork to protect their interests.
Since this is an external fork, in the world of place settings, this would be the ‘Salad Fork‘.
A fork driven by core developers or project founders often happens for architectural or political reasons. These motivations for an internal fork make a big difference.
Architecture or Features
A fork based on architecture is a fork that is based on sound motivation. If the core developers do not agree on the direction that the architecture or feature set should go in, the software in the new fork will be different from the original. Community members will decide, based on which architecture or set of features meets their needs, which code line to follow: the original or the fork. If one code line is significantly better than the other, one will fade away. This is competition based on the value of the software and the needs of the communities.
Since this is an internal fork of substance this is the ‘Dinner Fork‘.
A fork for purely political purposes might not be beneficial. It has all of the negative possibilities of a fork (diluting the community etc) with less potential for benefits (choice etc). It has the potential to be nothing more than a popularity contest based on personalities, not on technologies.
Since this internal fork has a certain stench to it, this would be the ‘Fish Fork‘.
Looks like the Oracle acquisition of Sun is helping MySQL – according to Zack Urlocker (MySQL Marketing VP) via Twitter
Set a new record in lead gen last week. More than 15x what we were doing 3 months ago. Quantity and quality are both improving.
Maybe the threats of forks and rebellions are premature, particularly if the leads increase sales, and sales increases engineering resources. Whether the recent increase in transparency and openness continues at MySQL might be the bigger question.
I don’t know a whole lot about the publishing industry (other than the fact that it is not adjusting well to advances in technology and media). Based on my experience in commercial open source here are my thoughts on how to open source a book:
Lower Your Marketing Costs
If your business model includes spending a large percentage of your income on sales and marketing efforts, you need a huge shift. You need to get to a model where potential consumers are able, on their own, to prove to their satisfaction, that the book meets their needs. Severely cut back on advertising and marketing tasks that do not scale with little or no incremental expenses.
There is still value in printed content. I have bookmarks in my browser for the contents of Eric Raymond’s ‘The Cathedral and the Bazaar’. However last week, when I wanted to re-read a whole chapter, I hunted around the office until I found a paperback copy.
Lower Your Sales Costs
Ignore Tough Customers.
Some customer segments are hard to sell to. Ironically, government departments are one of these segments. The State of California is apparently very hard to sell textbooks to, they put lots of barriers into the process.
It is the same way with software. Open source and commercial open source software has a low-cost distribution system. The idea is that the consumer proves to their satisfaction that the software does what they need. This is what enables the up-front license fee to go away. This only works if the supplier does not have to spend time and money on RFPs and pre-sales activities. If a high-effort procurement processes is used, the process will favor high-cost proprietary providers.
The problem for state and federal government is that, at the same time they are expressing a desire to increase the adoption of open source, they remain fixed on a procurement process that is high-touch, high-cost, and favors proprietary vendors.
Lower Your Prices
Last year the music industry made over 1 billion dollars selling ring-tones. Meanwhile some musicians still insist that we can only buy an entire album, not individual tracks. The average selling price of commercial open source software in the enterprise market is about 80% lower than that of proprietary companies.
Publishers need to find ways to sell and license content in smaller packages. Publishers need to create a system where consumers can license content from multiple publishers to create a new book.
Lower Your Development Costs
Find ways to enable authors to create content without as much hand-holding. Enable crowd-authoring. Enable collaborative and competitive authoring. Let the community provide the feedback and the editing.
Summary: Change Your Business Model
Flatworld Knowledge is a company that is trying this. You can create customized works, they have per-chapter pricing etc. You can combine content from multiple sources and add case studies to make a new book. The one thing they don’t have is any crowd-authoring capabilities.
My advice to the State of California is this. If you want to save money by changing the way textbooks are produced, you are also going to have to change the way that you consume them. You will fail if you do not. Good luck, we’re all cheering for you.
I have just added a few more ideas to the open projects page in the Pentaho community wiki – http://wiki.pentaho.com/display/COM/Open+Project+Ideas
If you are interested in trying any of them just let us know.