January 31, 2006 4:00 AM PST
'Free' is the new 'cheap' for software tools
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"The whole notion is to develop the community and to grow the adoption. (Free databases) is one way to stop the open-source database adoption--it's not really going to generate revenue per se," Yuhanna said.
Forrester estimates that the open-source database market, which includes support, service and license revenue, was about $300 million last year and will grow to $1 billion by 2008. Demand is being driven in large part by lower costs and maturing products, said Yuhanna, who predicts that 20 percent of "mission-critical," or essential, corporate applications will run on open-source databases by the end of the year.
Freely available software has been around for some time. But free products, which encourage developers to try out software, combined with open-source communities around those products, can be very compelling for a software company, noted RedMonk's O'Grady.
Open-source communities tend to spawn the creation of add-on products, such as plug-ins to a browser. They also foster the usage of open-source components in a certain combination, such as LAMP (Linux, Apache, MySQL and Perl, Python or PHP), he said.
"The real battle here isn't revenue, it's developer mindshare," O'Grady said. "By leveraging open source, (open-source database provider) MySQL and others have been phenomenally successful at capturing developer mindshare."
The prices for development tools, which are often used in tandem with databases, have shrunk down toward zero, as well. The popularity of Eclipse, an open-source framework, has made it difficult to charge for a basic integrated development environment (IDE), analysts have said.
Last November, Sun Microsystems made all of its development tools free to programmers who sign up for a yearly subscription to the company's developer network. And Borland Software, which traditionally focused on selling IDEs, has revamped its strategy over the past three years to selling suites of lifecycle tools that address testing, modeling and coding.
In another example, Adobe Systems on Wednesday is expected to revamp the pricing for its Flex Flash development tools.
The first version of its Flex tool set was about $15,000, but the price was throttling its adoption, said Jeff Whatcott, senior director of product marketing at Adobe's enterprise and developer business unit.
"The goal is to get to a million developers building rich Internet applications," said Whatcott. "To do that, you need a good product line. But you also need a licensing model that supports viral, development-to-development marketing. That doesn't happen with a $15,000 product."
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