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James Dixon’s thoughts on commercial open source and open source business intelligence

Misunderstanding open source #3: applying ‘Free Software’ religion to open source business models

with 21 comments

Applying the philosophies of the Free Software movement to the world of open source business models is a pointless exercise.

To the participants in the open source movement, open source is a great way of creating software – the transparency, openness, and participation/contribution mechanisms enable better software to be created more quickly. This is a practical, pragmatic viewpoint. This is the viewpoint of the commercial open source companies. Open source advocates want a future where great, customizable software is available for every task or domain.

The participants in the Free Software movement see things differently. They have a purist viewpoint of  intellectual property rights, and apply their viewpoint religiously. Free Software advocates want a future where intellectual property and intellectual property laws are a thing of the past.

When Free Software advocates give opinions about commercial open source companies and business models, its like sending vegans to a  steak-house – there isn’t much on the menu to their liking.

Open Core Business Model

A particularly contentious issue for Free Software advocates is the ‘open core’ business model. In this model a company creates an open source code-base in a particular domain (business intelligence in our case), and provides additional features, support, services as commercial offerings. The idea is that the community around the open source code will help lower the development costs so that the commercial offerings can be at a price point that is disruptive in that domain.

The open core model only works if the open source software is full-featured and valuable. If it is not there will be no community, and no community contributions. Without this the development costs will be the same as with a proprietary development model and the company will fail. In most cases the ratio of installations of the open source software vs the commercial version is 99:1 or higher.

The Free Software advocates, however, claim that the ‘open core’ software is hobbled, restrictive, or so feature depleted, that everyone needs the commercial version. This is utter nonsense. Take Pentaho, we offer in open source:

  • An Extract/Transform/Load (ETL) tool – Kettle.
  • A metadata editor and OLAP schema editor
  • A report designer
  • A Business Intelligence server complete with ad-hoc reporting, pivoting slice/dice UI, dashboard framework, and scheduling.

I see the open core model as vital in this phase of the growth of open source. Imagine a future where the majority (or all) of the software used by individuals and businesses is in open source. How do we get there? By creating an environment where innovators and investors are discouraged from creating any open source? That does not help. I see the open core model as something that provides new software start-ups and established software vendors a viable option to use an open source model. If there is any significant up-front development or investment needed, a support/services only model is rarely seen as a viable model. For an ‘open source future’ the usage of the open core model is much more preferable to the proprietary option.

When it comes to start-ups the options considered viable (by most investors) are
1) produce 80-90% open source code with an open core model
or
2) produce 100% closed code under a proprietary model

Given these choices the first option is clearly preferable to open source advocates. To Free Software advocates, using an ‘exclusively 100% free’ viewpoint, the open core model is flawed and so they argue and petition against it – regardless of the practical consequences, which is more proprietary software.

If you reject the open core model you are, in effect, asking start-ups to stick to proprietary development. This is a step backwards and delays the creation and adoption of open source software over the long term

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Written by James

October 5, 2009 at 2:55 pm

21 Responses

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  3. I think the point that’s missed is that there are plenty of folks who don’t necessarily think “the open core model is flawed,” only that it’s not fully open-source, and thus shouldn’t get to ride the coattails of the buzz for open-source by touting itself as such. Open-source advocates understandably get a bit incensed when they put thousands of hours of sweat-equity into getting open source software into the public eye, only for it to be used as a marketing gimmick from a company that makes money licensing proprietary software with an open source core, while giving the impression they’re a part of that movement.

    There is nothing wrong with a hybrid open/proprietary business model per se, but it is just that: a hybrid. If you’re sensitive to that and send the right message, it doesn’t have to become a battle.

    I suspect that if open core companies’ web sites said “we’re open core!” on the front page instead of “we’re open source!” many detractors would go silent. (Pentaho, I see, does it right at least by not splashing “open source!!!1! OMG!” all over their web site and instead focuses on touting features of the enterprise version…)

    As for claiming that “the ‘open core’ software is hobbled, restrictive, or so feature depleted,” well, it depends on the company. I know of at least one open core network monitoring tool that sends “node down” events in the open source version, but only sends “node up” in the enterprise edition (unless they’ve changed that recently). Not every open core company restricts themselves to business-focused value-adds on top of a widely-useful core platform. :)

    Benjamin Reed

    October 6, 2009 at 12:44 pm

    • Hi Benjamin,

      I agree with most of your points.

      But to take your first point to a higher degree you seem to be saying that someone who puts a million lines of code into open source but keeps a single line for himself cannot use the term open source, but someone who puts 100 lines of code into open source and holds non back can. This makes no sense to me. This kind of ‘100% exclusively open’ thinking indicates a free software advocate, not an open source one.

      Also, in the mainstream market today there are still a huge population that have not heard of open source. Using terms like open core to appease an extremely small but frustrated minority won’t help anyone.

      When it comes to the open core codebase – a pragmatic open source practitioner will look at the open source code available and consider its value. If it is of value, they will use it, if it is not they won’t. Why worry about code you don’t need or how the producers of the code make money?

      In reality most of the detractors of the open core model are not open source practitioners at all, they are free software advocates writing on behalf of an open source community they don’t belong to, about ideals that the community does not share.

      James

      October 6, 2009 at 9:01 pm

      • I am all for pragmatism, and using the best tool for the job. If open core products are forthright about what is and isn’t closed, and don’t create a product that is missing important features (like a network management tool that doesn’t tell you when something’s back up) I have no qualms with people touting the openness of the open source part of their product. Apple, for example, is clearly a proprietary company, and they do open source their software when it suits them, but they don’t pretend to be an “open source company.”

        If the open core projects who plaster “open source” all over their web sites had a million lines of open code, and 1 of closed, I don’t think we’d be having this discussion, because no one would care. The issue only comes up at all because of tools claiming to be an open source product which are instead an open source platform upon which the (actually marketable) closed source product is built. They are the ones ruining it for the other open core software companies that /do/ try to balance community and private development in a reasonable manner. I do feel that in the long run, most open core companies will not have the discipline to manage the dichotomy between a vibrant community that can implement new features (including features in the proprietary portion of the code) and a desire to control revenue streams — but that’s a business issue, not directly related to misuse of the phrase “open source.”

        As for the “free software advocates writing on behalf of an open source community”: having been involved in open source software since before the phrase was coined, I remember the origins differently. “Open Source,” as a phrase, was not so much coined to remove the emphasis of freedom from Free Software, but instead to make the point that “Free Software” had inherent value that could compete in the marketplace on it’s own and wasn’t just for purists. While it was about expanding the inclusiveness of Free Software, the open source definition is still very much about preserving that freedom. The only real functional difference was fixing the word “free” that is ambiguous in the English language.

        I am very happy to be a member of *both* communities, because in my case, they are one and the same. If some people have chosen to focus less on the freedom part of Open Source because open source software is *also* a good value proposition, they are welcome to. However, the freedom is still there, and open source is still about freedom whether or not it’s a feature of open source software that you care about. The idea that believing in free software and open source are automatically at odds is clearly the root of why this argument keeps coming up.

        I think it is possible to care about free software completely, or not at all, and open source covers a bit of both, but it is still important to note that open source *is* still about openness, regardless of which part of the open source spectrum a given person may wish to focus on.

        Benjamin Reed

        October 7, 2009 at 3:18 am

  4. I’ve contributed code to open-source projects, and I offer as much support as I can to Pentaho.

    The thing that irks me though, is that all the marketing says “Open Source” (eg. “Open Source Business Intelligence”) and “Yes, the open source software does that” only to discover that no… to do that, you need to buy the enterprise version.

    I work for a company that is willing to spend the dollars on a support contract… once the value of the product is shown. And we have spent a lot of money on Open Source products.

    Clearly saying ‘This is what you can do in the “Free” version’ and ‘This is what you can do in the “Supported” version’ is really important. If you want people to support the community, you cannot give even a hint of mis-leading them.

    Pentaho suffers from this. They say “Yes, we can do that” when what they really mean is “Yes, there is that feature in the supported version”

    FLOSS Contributor

    October 8, 2009 at 4:05 am

    • Thanks for the reply.

      Can you give me any examples of things you cannot do with the open source software? The enterprise edition features reduce your cost of ownership by making things easier – not make the impossible, possible.

      James

      October 8, 2009 at 1:21 pm

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    October 21, 2009 at 7:41 pm

  7. If open core products are forthright about what is and isn’t closed, and don’t create a product that is missing important features (like a network management tool that doesn’t tell you when something’s back up) I have no qualms with people touting the openness of the open source part of their product.

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    John Caldwell

    October 22, 2009 at 6:01 am

  8. I think the point that’s missed is that there are plenty of folks who don’t necessarily think “the open core model is flawed,”

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    john caldwell

    October 22, 2009 at 6:13 am

  9. Hello from Russia!
    Can I quote a post in your blog with the link to you?

    Polprav

    October 23, 2009 at 2:33 am

  10. nice posting. Thank’s for referece ^_^

    hanum

    October 24, 2009 at 9:29 am

  11. Nice posting… I like it.

    Tantono

    June 9, 2010 at 4:52 am

  12. In the end the money made with the proprietary part of the product will be invested in producing more proprietary software. If the only reason for paying was the proprietary parts. You don’t sell the open source part, do you?
    It doesn’t make sense invest in something that doesn’t make any money.

    Jack

    July 24, 2010 at 7:56 pm

    • For the model to work a large amount of adoption is necessary. Therefore investment in the open source part is very important.

      It is also important that the open source part is fully functionality and useful – otherwise you get no adoption. So the term ‘open core’ is not very accurate.

      James

      October 14, 2010 at 4:16 pm

  13. You use the word “religious” and derivatives as depreciative term. And you equate the Free Software principles to a “religion”. The Free Software principles are practical and realistic. You also oppose Free Software to Open Source. This is clearly wrong since their objectives and principles are the same even if worded differently.

    Your rebuttal of the critics of “open core” is entirely based on insults. Seems to be a common strategy of the few people trying to sell “open core” as the new “open source”. You don’t debate on the merits, you insult!

    Jack

    July 24, 2010 at 8:08 pm

    • I disagree.

      The philosophy of the free software movement is that intellectual property is bad. The FSF even comments on IP topics that have nothing to do with software – like DRM of music and films.

      The open source viewpoint is that proprietary software development practices are inefficient and that openness and transparency are better.

      I don’t believe that IP is bad. I do believe that proprietary software development is inefficient. Therefore, to me, free software and open source are not the same thing.

      James

      October 14, 2010 at 4:22 pm

  14. But your insults are misguided, since your biggest and loudest critics belong to the “open source” group not to the “Free Software” group.

    Jack

    July 24, 2010 at 8:11 pm


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