James Dixon’s Blog

Bradley M. Kuhn posted recently that “Open Core” Is the New Shareware

In it he trots out all of the usual misconceptions that the free software advocates frequently do about the open core model. But I give him credit for being direct about his Free Software allegiance (not purporting an open source one), and for describing what he imagines to be an ideal Free Software company.

The first move we have to make is simply give up the idea that the best technology companies are created by VC money. This may be true if your goal is to create proprietary companies, but the best Free Software companies are the small ones, 5-10 employees, that do consulting work and license all their improvements back to a shared codebase. From low-level technology like Linux and GCC to higher-level technology like Joomla all show that this project structure yields popular and vibrant codebases.

This identifies something that, to me, is the biggest flaw in the ideology of the Free Software movement – an end game that is unsustainable and unattainable.

As I have written before (in this post Misunderstanding open source #3: applying ‘Free Software’ religion to open source business models). I think it is important to imagine a future where the majority of software is free/open source software (FOSS). If that is something you think is desirable (and there are a lot of people who don’t), I think it is important to also imagine how we get there.

I assume that if Kuhn thinks that 5-10 person companies are the ideal ones to represent free software, then his ‘future’ for free software is a collection of 5-10 person companies stewarding all of the planet’s software. This implies little or no involvement from large software vendors or services companies like IBM, Oracle/Sun, and Microsoft. Not even medium sized or small companies can participate, only microscopic companies. Ask yourself this: in this future, can the software and support needs of most organizations and governments of the world be handled by this group of 5-10 person companies? Clearly not, this is ridiculous. Large organizations and companies require the products and support of much larger software providers. They require things like pre-sales support, RFPs, and service level agreements. They require 24×7 support worldwide. In this version of the future the open source vendors that exist cannot meet the needs of the mainstream markets. As a result the large proprietary software vendors survive happily, because the open source vendors do not provide a viable alternative. This is clearly at odds with the desires of the free software movement. They want to eliminate proprietary software and proprietary software companies, yet their behaviour ensures the survival of those things.

Aha! (you might exclaim) what about the example of Linux that Kuhn provides. Ok, lets examine that. Firstly you cannot use the original creator of Linux, Linus Torvalds, as a shining example of the virtue of free software because he frequently is critical of the free software ideology, he is not a free software advocate. Certainly you can point out that Linux is steered by a foundation and not by a corporation. But look at the board of directors of the Linux Foundation. As of today they are Larry Augustin CEO of SugarCRM (an dubious open core company, according to some), James Bottomley (Novell), Alan Clark (Novell), Wim Coekaerts (VP Engineering at Oracle), Masahiro Date (general manager of Fujitsu), Frank Fanzilli, Doug Fisher (VP Intel), Dan Frye (VP IBM), Bdale Garbee (Chief Technologist Hewlett-Packard), Tim Golden (Bank of America), Hisashi Hashimoto (Hitachi), Brian Pawlowski (NetApp), Chris Schlaeger (AMD), Tsugikazu Shibata (NEC), Eric Thomas (Texas Instruments), Christy Wyatt (VP Motorola). The mighty and free Linux is steered by a big software/hardware cartel – Novell (Microsoft’s Linux partner), Oracle, IBM, HP, Hitachi – and a chipset cartel – Intel/AM/TI/Motorola. I am not saying that this is a bad thing, in fact it is a good thing. What I’m saying is that using Linux as a ‘free software’ example is a big stretch.

The open core companies are trying to disrupt entrenched proprietary software markets. The free software movement dislikes proprietary software. They have a common enemy in proprietary software. The open core companies would welcome the free software movement as an ally, however the free software advocates choose open core as an enemy. What they don’t realize is that many potential open source companies are choosing between proprietary and open core – 100% open source is not an option. By inciting community members, as Kuhn does, to fork open core projects, he is creating an anti-open core environment that might persuade new start-ups to go proprietary rather than open core. The open core model is preferable to proprietary, but listening to the opinions of the free software advocates you don’t hear that message at all.

The path from a proprietary world to an open source one is a long one. It started over 20 years ago, and it will take another 20 years to get to the end. Maybe at the end the open core model will be a historical footnote. But along the road the open core model is a useful stepping stone that allows otherwise proprietary software companies to become at least partially open, on the way to full openness.

Many people are confused about the free software vs open source debate because they don’t know (or they hide) their own alignment. Take this quiz to help you identify where your inner compass lies:

Poll #1

Poll #2

Poll #3

Poll #4

Poll #5

You Are…

Mostly ‘1’s: You are a free software junkie. Own it, celebrate it, enjoy it. Just don’t pretend you are an open source advocate, you are not.

Mostly ‘2’s: You are a true open source hacker. As long as the source code is available (should you ever need it), and the license is OSI approved, you are all about getting the job done and moving on to the next problem.

Mostly ‘3’s: You are still trying to convince yourself that this open source thing is a temporary fad. You do this because it is much easier to do this than accept the truth – which is that your line of work, your company, your business model, and/or your past vendor choices are starting to seem badly wrong.

* Yes, actually.

The recent release of some drivers under a GPL V2  license has got some people jumping up and down with excitement that Microsoft is changing its open source strategy.

Given that Microsoft was violating the GPL by not putting the drivers into open source the truth seems a little rosy.

http://www.theregister.co.uk/2009/07/23/microsoft_hyperv_gpl_violation/

My guess is that, when faced with the situation, they only had a few choices:

1) Withdraw the drivers – and withdraw from that market.

2) Fight the GPL in court. This would directly contradict Microsoft’s stated position and generate a huge amount of negative press.

3) Put the drivers out under GPL V2, and turn it into a PR win. There is probably not much code, and no patented code in the drivers, but they would have checked this first.

Given these three options I think they chose the one that was the least painful. Hardly a change in strategy.

This coming Friday I will be on the Frugal Friday Show – http://www.frugalfridayshow.com talking about open source-related stuff.

The show is hosted by Ken Hess (an author and consultant and Linux blogger on DaniWeb) and Jason Perlow who is a blogger on ZDNet

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.

Maybe this isn’t news to anyone but I think I finally understand Microsoft’s strategy when it comes to open source. If I’m right, I’m quite impressed (with them, not me). The net of this is that Microsoft would like you to (in order of preference):

1. Pay for and use Microsoft software
2. Use open source software and have a Microsoft licensing agreement (e.g. Linux under the Novell deal)
3. Use open source software that violates Microsoft patents so they can force you to make license payments (e.g. TomTom)
4. Use their competitor’s software
5. Use open source that does not violate their patents

For #4 and #5, I think they would prefer you pay for competitor software than use unencumbered open source because you are still in the world of vendor lock-in, where traditional marketing and sales tactics are effective. If you are using unencumbered open source software you are below their radar and you are difficult for them to reach.

I patched this together from these isolated facts and incidents:

Halloween Emails – 1998

In 1998 a series of internal emails were leaked from Microsoft (the Halloween emails). It is clear from these emails that Microsoft understood how open source worked, that it was a threat, and that attempts to market against it were counter-productive. In the next few years Microsoft does little or nothing to fight against open source.

Source – The Halloween Documents (Eric Raymond, catb.org)

Lack of Patents < 2001

Microsoft did not make a lot of patent applications prior to 2001. It ended up making a lot of payments to other software companies to resolve IP claims because of this. Bill Gates resolves to remedy this.

Source: Gates wants patent power (Ina Fried, CNET)

Strategy Revealed – 2002

From an internal memo at HP:

“Basically, Microsoft is going to use the legal system to shut down open-source software. Microsoft could attack open-source software for patent infringements against (computer makers), Linux distributors, and, least likely, open-source developers,” Gary Campbell, vice president of strategic architecture.

At that time the open source projects specifically mentioned were: Samba, Apache HTTP, and Sendmail.

Source – HP memo: Microsoft planned open-source patent fight (Stephen Shankland, CNET)

Cross Licensing Initiative – 2004

In order to meet its patent portfolio goals Microsoft embarks on a cross-licensing initiative.

“If we are able to strike cross-licensing deals with the top 30 technology companies, that alone would provide us access to a vast majority of the patents in areas we care about”, David Kaefer, Microsoft’s director of intellectual property licensing.

This was done to protect Microsoft from IP claims made against it by proprietary companies, but it plays into their open source strategy.

Source – Microsoft–License To Deal (Ina Fried, CNET)

Microsoft Shared Source – 2005

Around 2005 Microsoft started to make some of it’s source code available under a ’shared source’ program. Jason Matusow (director of the program) claimed this was to try to replicate the advantages of open source. It sounds good but under this program you are allowed to view their source, but you are not allowed to use the source. This text is from Microsoft’s Developer Center is rather ominous:

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

So by making their source code available they make it very tempting for developers to use it as a source of code samples. But doing so leaves you open to legal problems that are best resolved by making license payments to Microsoft.

Codeplex – 2006

In order to encourage developers to inadvertently full into the shared source trap, Microsoft launches Codeplex.

Source – Microsoft to Launch Code-Sharing Site (Martin LaMonica, CNET)

Microsoft Novell Partnership – 2006

This agreement is particularly interesting. The deal protects Novell’s customers from legal action by Microsoft for any IP infringements that exist in Linux. Effectively Novell customers are pay Microsoft (through Novell) for the right to use software that includes functionality covered by Microsoft’s patents.

Source – Microsoft Statement on Novell Agreement (Microsoft.com)

The Linux Attack – 2007

Microsoft claims that Linux violates 235 of its patents. However Microsoft won’t reveal which of it’s thousands of patents at the problematic ones.

Many open source participants ask Microsoft for the list, saying that they will re-write the offending code so that the violate is removed. They miss the point. Microsoft wants the violations to remain in place. Microsoft wants users of Linux to pay a license fee to Microsoft to cover the use of their patents. That is, everyone except Novell’s customers, who have pre-paid for that same license (they pay Novell, Novell pays Microsoft).

Source – Microsoft Takes on the Free World (Roger Parloff, Fortune)

The TomTom Takedown – 2009

The recent TomTom case is a good example of the patent attack. Microsoft revealed two of its patent cards – #5,579,517 and #5,758,352 around the FAT filesystem – and slapped it on TomTom for using a Linux distribution that includes FAT-based code. The result of this case is that TomTom now pays license fees to Microsoft for the use of that code.

Source – Microsoft and TomTom settle patent dispute (Ryan Paul, ars technica)

So now we know 2 of Microsoft’s alleged 235 Linux-related patents. Now that Microsoft has revealed these patent cards it would clearly be in the interests of the open source movement for all the code that could violate the FAT patents to be removed or re-written in such a way as to avoid the IP issue (if possible). Long-time open source advocate Larry Augustin takes this position also.

Source – Linux, Microsoft and Patents: It’s Time to Get the FAT Out (Larry Augustin’s Weblog)

Summary

Since identifying open source as a threat 10 years ago Microsoft has consistently done two things: increased its patent portfolio, and gained revenue from licensing that portfolio to others.

Microsoft has  clearly decided that it cannot directly fight or defeat open source. But it can further increase license revenue by attacking users of open source with claims of IP infringement.

Individual open source developers are too small to target with attacks such as this. But any large company using open source internally or in a product or service should be concerned by this. The open source movement as a whole needs to pay attention to IP issues.

There are many people in the open source movement who hold a “we don’t believe in intellectual property” stance. They may, one day, find themselves sending a monthly payment to Microsoft for privilege of continuing to hold that belief.