The disappearance of open source as a differentiator
As open source has become big to businesses, it has also become big business, with Gartner predicting that vendors will increasingly maintain the leading open-source projects. Vendors, and predominately "proprietary vendors," dominate open source today. Given this assimilation of open source into the proprietary software fabric, has open source won? Or lost?
It's likely to get even lonelier.
The 451 Group's Matt Aslett suggested 2009 was to be the year of open-source mergers and acquisitions. While that hasn't yet materialized, it's just a matter of time before the best open-source vendors are scooped up by proprietary vendors.
Take Zenoss, for example. The company recently registered its one-millionth download, with an active community and user base. If you're a proprietary network management vendor stuck in the old model of high-cost sales, why wouldn't you buy into Zenoss' success? Sure, you will generally pay a premium, as it's not cheap to build successful open-source companies, but I've yet to hear a company complain about an open-source acquisition.
But with all this past and projected merger of the open-source world into the proprietary world, should we be concerned that "open source" will lose its meaning?
I don't think so. Gartner's Brian Prentice is absolutely correct to suggest that "we are rapidly moving to the point where all software companies will, to some extent, be an open source company." It's simply a matter of degree (Red Hat sells more open source than Microsoft) and revenue model (Open core versus open complements versus...).
Unfortunately, for the next year or two, we'll remain in transition. I've called it "commercial open source's awkward teenage years," but it's awkward for more than just traditional open-source vendors.
Take Microsoft. Microsoft used to be able to conveniently label open source as "un-American" and "an intellectual-property destroyer." Now that open source is a core part of its strategy, however, Microsoft's soundbites on open source won't be nearly as potent or pithy.
Take Microsoft's announcement about a new bridge it built between open-source PHP and .Net. No talk of "the American way" or anything cool like that. All the talk was about technology working together.
How boring is that?
If you're an enterprise CIO, this is what you've been waiting for: the war between open source and proprietary software to end and simply work together. CIOs can't afford to be dogmatic. They like open source for its flexibility, low-risk evaluation, etc. They couldn't care less about open source as a religious coda.
Customers win in the process. IBM's Savio Rodrigues writes: "It was/is inevitable that any software vendor with a budget to worry about will choose to consume open-source components versus building from scratch when the customer value point is higher up the stack." This means less money spent reinventing the wheel, and more on customer value.
Indeed, I suspect that IBM is really the best model for an "open-source company" going forward. IBM has invested heavily in open source and uses it throughout its product line, but also competes aggressively with open source (Ask a member of IBM's Unix team whether a customer should use Linux or Unix).
IBM, in other words, understands that open source is not "one-size-fits-all" when it comes to meeting customer requirements and ensuring its business is sound (so that it can scale its ability to meet more customer requirements). IBM is an open-source advocate without being an open-source polemicist.
This is the model going forward. It doesn't fit into convenient taxonomies, but it's arguably the right way to think about an "open-source company."
Follow me on Twitter @mjasay.
Matt Asay brings a decade of in-the-trenches open-source business and legal experience to The Open Road, with an emphasis on emerging open-source business strategies and opportunities. Matt is vice president of business development at Alfresco, a company that develops open-source software for content management. He is a member of the CNET Blog Network and is not an employee of CNET. Disclosure. You can follow Matt on Twitter @mjasay. 
Matt Asay links to an article about possible Red Hat buy out that was itself inspired by the rumor Matt started on his twitter feed on the same subject. The circle is complete. Bravo....bravo.
-jef
Matt is like Cartman trying to prove something, he tells Butters his theory and then uses Butters as a source.
Small software companies are acquired by Big ones, independently of their licenses or business models.
Another recent example: the VMWare acquisition of SpringSource
Will Alfresco ever be acquired? What are your preferences?
Of course, he won't be entirely happy until no software (except for leisure/entertainment software, like games) has only one company working on the code and providing support for it. Whatever anyone might think about Stallman on a personal level this would theoretically be a winning result for customers, if not necessarily viable from a commercial perspective.
From an analytical point of view, so long as the software continues to be properly supported and remains open source there's certainly no loss and if funding and resources to the project increase as a result of acquisition then it's got to be a win.
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Cheers :)
- by mattflaschen August 26, 2009 11:49 AM PDT
- I think this article may be missing the point. It's possible that soon, all companies will be open source in some sense. But smart purchasers already demand more than buying from a vaguely defined "open source company". They will ask for quality open source software (satisfying the OSD) that meets their needs. As long as consumers remain smart, open source will continue to thrive.
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