In the cloud, no one cares about your software license. That is one of the most liberating--and frustrating--things about cloud computing.
Depending on your perspective, it either opens up computing or closes it off. Customers don't seem to care one way or another, happily shoveling data into cloud services like Google, Facebook, and others without (yet) wondering what will happen when they want to leave.
Cloud computing may just be the Hotel California of technology.
Google Trader
(Credit: Google)I say this because even for companies, like Google, that articulate open-data policies, the cloud is still largely a one-way road into Web services, with closed data networks making it difficult to impossible to move data into competing services. Ever tried getting your Facebook data into, say, MySpace? Good luck with that. Social networks aren't very social with one other, as recently noted on the Autonomo.us mailing list.
For the freedom-inclined among us, this is cause for concern. For the capitalists, it's just like Software 1.0 all over again, with fat profits waiting to be had.
The great irony, of course, is that it's all built with open source.
In this cloud computing/Web 2.0 world, infrastructure needs to be cheap, flexible, and plentiful. Open source delivers all three.
Hence, we've seen companies like MySpace tripping all over themselves to open up parts of their platforms in order to make themselves more appealing to developers. As ReadWriteWeb wrote of Facebook back in 2007, however, such developer outreach has not opened up these Web platforms in the sense of providing useful off-ramps to services like Twitter, Digg, Facebook, etc. It has simply created more on-ramps.
Cue the nefarious Microsoft theme song.
Rather than wringing our hands over this, I think there's an opportunity to create amazing amounts of good (and wealth) in this open/closed Web. Frankly, the longer we're in this, the less it's going to matter whether the code is open or closed because, as Tim O'Reilly has been saying for years, data is the heart of the Web, and even open data isn't going to hurt a successful vendor's network effects.
Take Google Trader, an interesting new SMS application that helps people buy and sell goods through text messaging. As The Economist notes, however, one of Google Trader's most interesting applications is in helping to foster free markets in emerging economies:
Lastly there is Google Trader, a text-based system that matches buyers and sellers of agricultural produce and commodities. Sellers send a message to say where they are and what they have to offer, which will be available to potential buyers within 30km for seven days. Mr Makawa says his father used the service to look for a buyer for some pigs, which he sold to pay school fees. These services cost 110 shillings ($0.05) a time, the same as a standard text message, except for Google Trader, which costs double that. In their first five weeks the services received a total of more than 1m queries.
I'm not familiar with the economics of SMS, but I'm guessing that Google gets a cut of the messages its application generates. The more useful Google Trader becomes, the more SMS it generates, the more commissions Google collects.
For the entrepreneurs using Google's service, they could possibly care less whether Google Trader is open source, but Google might. Open the source (and the API to the service), and let a thousand add-on development projects bloom. The more useful and feature-rich the Trader application, the more SMS, the more...you get the picture.
Take me to Google, Earthling.
The key is to create an open Web platform, one into which a diverse array of mobile software services can tie. This is one reason Google is such an advocate for open source. Android and other projects bring more people to the Web, a Web that Google monetizes through proprietary services like AdWords.
The community is critical to building upon the platform, but the money is in control of the platform and provisioning of services therefrom.
Just ask Amazon.com. According to ZDNet, Amazon's Elastic Compute Cloud (EC2) service makes roughly $220 million per year. That's a lot of cash, and is a function of EC2 sitting at the heart of a growing developer community, one that builds upon Amazon's open APIs to the service.
Some companies like Cloudera and Red Hat will make piles of cash providing the infrastructure for this cloud-computing gold rush. But the biggest money of all will be those that can build platforms in the cloud, platforms that depend upon open source but which aren't open in the traditional open-source license sense of the word.
That traditional licensing world is dead. Open-source licensing has become an on-ramp to closed data services, hardly what its creators envisaged. In fact, proprietary cloud vendors are almost certainly going to become the biggest cheerleaders for open source, because it means more developers creating more on-ramps to the cloud.
Even if such providers create effective exits, it's unlikely that consumers and businesses will actively use them...
...just like in the Software 1.0 world.
Follow me on Twitter @mjasay.
I admit that I nearly got caught up in my former colleague James Urquhart's excellent analysis of Canonical's Ubuntu 9.10 release, code-named Karmic Koala. I saw the word "open" laced heavily through the post, and given Canonical's commitment to fully open-source Ubuntu experience, I played along.
But something doesn't quite fit in Canonical's story.
It's called Amazon.com. Yes, Ubuntu 9.10 will give users an option to build its own Elastic Compute Cloud-style service, using open-source Eucalyptus (or another cloud provider), but the intent certainly seems to seamlessly plug users into Amazon's closed cloud:
Ubuntu aims to keep free software at the forefront of cloud computing by embracing the APIs of Amazon EC2, and making it easy for anybody to set up their own cloud using entirely open tools...During the Karmic cycle, we want to make it easy to deploy applications into the cloud, with ready-to-run appliances or by quickly assembling a custom image...Wouldn't it be apt for Ubuntu to make the Amazon jungle as easy to navigate as, say, APT?
Or is Ubuntu simply making it easier to navigate one's way into the Amazon jungle but not to get out of that jungle?
This isn't meant as a criticism. After all, I've increasingly seen that the best way to monetize open-source software is with the careful inclusion of proprietary software. I told The New York Times' Ashlee Vance that Mark Shuttleworth would eventually have to grapple with this same strategy, basing it on my own conversations with Shuttleworth about how to effectively monetize Ubuntu.
That strategy increasingly points to tethering an open server (and desktop) with closed cloud services. That's not a critique. It's a fact.
Unfortunately, it's also a fact that once Ubuntu hands off its customers to a closed cloud, it depends on that cloud vendor to offer open data policies. The delivery of such policies is out of its hands. It won't have much say in the matter.
It's ironic, in many ways, that the key to Canonical monetizing Ubuntu will be proprietary software. There's a very good reason that Canonical isn't leading with a link into open-source software like Eucalyptus: just as Red Hat depended on proprietary Oracle to drive its early business, Canonical's best chance of driving open-source revenue from Ubuntu is likely to be closed-source Amazon.
Amazon's service is popular. It's also proprietary. Depending on an open but weak cloud service would be futile; building bridges to proprietary Amazon will likely not.
Canonical, just as Google has done in search, is helping its users build habits. I am sure that there will be positive financial remuneration to Canonical, the more that Ubuntu users indulge their Amazon EC2 habit--a habit that Canonical therefore will have an interest in feeding.
Is this bad? No, it's business. Even Canonical needs to make money, and it's really, really hard to make a lot of money by giving everything away.
Some things need to be closed. In this case, it's the cloud that Ubuntu will feed.
Follow me on Twitter at mjasay.
Episode 5 of Open Sources, the podcast that fellow CNET blogger Dave Rosenberg and I perform somewhat sporadically, is now live.
Dave and I discuss open-source venture funding (We think it's going to do well now that companies actually have to make money again), as well as the importance of owning (or controlling in some way) the open-source or cloud components upon which you build your solutions. Against the grain of the common myths of open source? Maybe. But there are clear examples of why you wouldn't want to be Amazon'd out of business.
Enjoy.
Listen now: Download today's podcastCould Microsoft's proprietary licensing end up hurting it in the cloud?
That's the question asked on the Cloud Avenue blog, and the answer seems to be a clear "yes." Whatever the benefit to Microsoft in a desktop and server world, proprietary licensing stands to hobble its attempts to be widely relevant in the cloud or, at least, in Amazon.com's EC2 cloud.
Why? Because Microsoft's proprietary licensing ensures it can't be a viable player in Amazon's newly announced Paid AMI (Amazon Machine Image) Support marketplace. The program allows users to "share AMIs...with other users for a fee," but it turns out that this sharing only works with open-source operating systems:
This works well for open-source operating systems like Linux and OpenSolaris. Developers can set up the OS on local machines, build an application stack on top of it, optimize it, bundle it as AMI, and share them with other users. The freedom offered by open-source licensing allows them to be a player in this EC2 marketplace. Anyone sitting in any country in the world can offer personalized AMIs to anyone else in the world and make money out of it.
This is not the case with proprietary Windows-based AMIs. EC2 users can only take the bare-bones Windows AMIs offered by Amazon and install applications on the running EC2 instances. This is due to the proprietary nature of Windows OS licensing restricting the options for users. Under current licensing terms, there is no way for others to build an application stack on top of Windows OS, optimize and deliver it as ready made AMIs to other customers. In short, Windows based EC2 is not a player in the above-said marketplace due to its restrictive licensing policies.
Perhaps Microsoft doesn't care. Perhaps its cloud offerings will be of Microsoft, for Microsoft. But this isn't how Microsoft became the dominant desktop vendor that it is today. Microsoft dominates because it opened its technology enough to become the center of a vibrant ecosystem.
By cutting itself off from others' cloud-based offerings, Microsoft has chosen to go it alone. This could be a winning strategy, but my money is on the companies that can drive widely dispersed value from the cloud. With its proprietary licensing, Microsoft will not be among this group.
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