It's increasingly difficult to separate "open-source vendors" from "proprietary vendors," but Demandware, a proprietary software-as-a-service (SaaS) vendor, is attempting to do so in an effort to stem the rising tide of Magento, an open-source e-commerce project. Demandware's criticism of Magento largely falls flat, however, because it uses outdated descriptions of open source.
Demandware walks through a litany of complaints about open source--requires too many developers! forces you to upgrade your software all by yourself! forking and fragmentation!--but none hit the mark. Why? Because each is only somewhat accurate of the state of open source 10 years ago. As a critique of open source today, and specifically of Magento, Demandware's criticisms fall short.
There is a big difference between community open source and commercial open source, not to mention a diverse array of quality even within the "community" or "commercial" open-source areas. Some of Demandware's critiques might be true of certain community-led open-source projects, but they seem wildly off-base for any of the more popular projects, including Magento.
Unfortunately for Demandware, it turns out that open-source vendors care just as much about quality, stability, performance, etc. as proprietary vendors do. The difference is that open-source vendors shift the risk of deployment onto themselves rather than foisting it onto customers.
Equally unfortunate for Demandware, most of the leading open-source projects are increasingly under vendor guidance and control, as Gartner finds. This means that Demandware's complaints are relevant only to a dwindling population of open-source projects.
What's particularly ironic (and a bit galling) is that Demandware, after spending so much time criticizing open source, then goes on to describe its own software as...open source:
Much of our software stack--operating system, application servers, etc.--is open source. But we build a commercial SaaS platform on top of it and do all the heavy lifting for our customers.
How interesting. This sounds much like the model that Varien, the company behind Magento, uses. In fact, it describes the commercial open-source business model: give away a free and open-source version of the software but then charge customers for additional packaging, support, etc.
Fortunately, prospective customers of Demandware don't need to take the company's word for it on Magento. As open source, they can download it for free to see if it works for them. The same cannot be said for Demandware. If you're interested in evaluating Demandware, it appears that you've got just one choice: contact the company and let it start the sales machine:
Demandware sales model: Heavy on people
Apparently Magento is good enough to sell itself. But you won't hear that from the Demandware sales representative.
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Occasionally I get brilliant ideas about who should merge with whom in open source. OK, so it's very occasionally, but I think I'll start sharing them under a "mix and match" headline.
Forget fantasy football. It's time for "fantasy open source."
The first is OpenX, an open-source ad-server company that I've written about several times, and which I continue to believe offers a disruptive way to shake up the online advertising business, especially for smaller Web publishers. While Drupal is used by plenty of marquee brands like Intel and FedEx, it has a strong base of support within these smaller Web publishers.
While we're at it, why not also provide the e-commerce engine to turn ad-related interest into paying customers? Magento, which I've also covered several times, is a natural fit.
Yes, Magento, like Drupal and OpenX, has its share of big customers, including Germany's equivalent of REI, Globetrotter. But Magento already has a lot of traction within the mid-market segment that Drupal and OpenX also serve.
Disagree? Which companies (at least one of which must be open source) do you think should get together?
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Open source continues to move beyond its original confines of infrastructure software. Open-source application adoption is booming, while even the curmudgeonly router market is getting some open-source polish from Vyatta.
One area, in particular, that is getting an open-source makeover is e-commerce, with Magento apparently leading the pack with more than 750,000 downloads and a roster of great customers, albeit with strong competition from Oxid and Apache's OFBiz project.
Roy Rubin, CEO of Varien
(Credit: Varien)I've written about Magento before but wanted to dive in a bit deeper, so I contacted Roy Rubin, CEO and founder of Varien, the company behind Magento, for an update on the open-source e-commerce platform.
Q: Tell me about Magento. Where do you make your money and who is your typical customer? Can you give any data or statistics on how the company is doing?
Rubin: Magento is an open-source e-commerce platform that provides merchants with a sophisticated software platform to manage their online sales. Magento enables online businesses to develop and rapidly deploy multiple types of e-commerce sites from a single instance of the platform--globally.
Magento is available in two editions: Community and Enterprise. The business model is focused on our Enterprise Edition Subscription which provides additional set of features as well as product support, SLA (service level agreement), PA-DSS certification (soon) and warranties.
Magento is currently used by tens of thousands of merchants conducting billions of dollars in online transactions. We'll be reaching 1 million downloads by the end June 2009. In the first eight weeks since launching the Enterprise Edition Subscription, we've had over 7,000 merchants get in touch to learn more about our new product. We have closed a double-digit number of deals and now have a strong pipeline of merchants and solution providers that we are talking to.
A typical customer for us is an organization that recognizes the mission-critical nature of an e-commerce platform and expects a strong support/warranty/SLA as well as access to advanced enterprise features. Our customers today include Fortune 500s, midmarket brick and mortar retailers, pure-play Internet focused merchants, and smaller organizations.
What is your business/licensing model? Pure support (plus open source) or do you use an "open core" model, or something else? If so, how do you draw the line between open-source components and proprietary components? What determines whether something will be open or closed?
Rubin: We recently launched an "open core" model with the release of our Enterprise Edition Subscription. We've transitioned to this model after the first 12 months of business under a support model. With the Enterprise release, we've targeted the product towards a different market segment and the decision regarding the components available is primarily driven by our customers and partners. Our Community Edition road map and feature development will be determined by our Community Advisory Board, which we've recently formed to lead such initiatives.
Does Magento do particularly well in certain industries/geographies? If so, which ones?
Rubin: Our product today is primarily focused on the business-to-consumer (B2C) market. In terms of geography, we are doing exceptionally well in the North American and European markets, with the United States, France, and Germany being the most active and strategically important.
How has the recession affected your business?
Rubin: The economic climate has had a hugely positive impact on our business as medium and large-sized companies start to focus more on cost, flexibility, and time-to-market. Magento offers the same functionality as leading enterprise-class proprietary software providers in the e-commerce market but at 10 percent to 20 percent of the cost and much faster time to market. For online retailers, this is very important as every day offline is lost revenue.
Who are your top competitors, both open source and proprietary? Why should a prospect choose you over them?
Rubin: In the proprietary market, we compete against IBM, Microsoft, and a number of other players. In the open-source world, the competition is very limited, especially in the commercial open source market. There are some great open-source projects such as Apache's OFBiz.
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Magento, the leading open-source e-commerce platform, has just notched a new honor: Forrester Research has named it an "Emerging Player to Watch" in its Forrester Wave: B2C eCommerce Platforms, Q1 2009 report.
This is an exceptional testament to the growing momentum of Magento. Varien's Magento is the only open-source e-commerce platform named in the report, alongside industry leaders IBM and ATG.
But it's not what Varien has done with Magento that Forrester deems exciting. Rather, it is Magento's momentum, and implicit room to grow, that Forrester calls this out in its report:
Magento is a very exciting open-source e-commerce solution and...is typically delivered at the enterprise level through the professional services of the company that developed and launched the product, Varien....Enterprise-level e-commerce organizations should view Magento as an opportunity to launch small-scale side projects and experiments, but for larger companies with limited e-commerce needs, it may prove to be a very attractive solution.
Product maturity, proof of the product's scalability, and further development of SIs and Varien's own professional services may place Magento as an enterprise-class solution in the future.
This is precisely where most successful open-source products start: departmental deployments in the enterprise with more extensive applicability in the small-to-midsize enterprise market. However, as with Hyperic, MindTouch, and other open-source offerings, Magento is unlikely to reserve itself for these more limited deployments.
Forrester forecasts online retailers to upgrade their platforms over the next two years, and I suspect that Magento will increasingly get the nod as online retailers seek the flexibility, cost profile, and embeddability that an open-source solution like Magento can provide.
Follow me on Twitter at mjasay.
Installing an open-source enterprise application has never been easier. No hardware? No sophisticated IT department? No problem. At least, not if you use one of 38 JumpBox-enabled open-source applications, as it announced recently.
A rising number of companies offer virtualized instances of popular open-source applications, but JumpBox takes it a step further, deploying to the Amazon Elastic Compute Cloud (EC2) service, almost completely obviating hardware and setup quandaries.
JumpBox offers small to midsize organizations a library of open-source applications packaged as pre-built, pre-configured virtual appliances through JumpBox Open, its annual subscription service. Public Amazon Machine Images (AMI) for 12 JumpBox applications, including Ruby on Rails, (Alfresco, Movable Type, Magento), Drupal, SugarCRM and more have been made available for free. AMIs for the full suite of 38 applications are available to plus and premium subscribers to JumpBox Open.
Pricing of JumpBox Open starts at $299 per year (for one persistently running JumpBox instance of each application), rising to $999 per year to run up to 15 simultaneous production instances of any JumpBox-enabled application. In other words, it's dirt-cheap.
Powerful software, low price, and no fuss. What's not to like? If you're an SMB customer, probably not much.
But if you're an open-source application vendor, I suppose it's still an open question how JumpBox will work with you to share revenue. In my conversations with the JumpBox founders, this potential conflict has come up, and I know the JumpBox team is working on it. How well it gets resolved may well determine how much emphasis open-source vendors will put on the JumpBox sales channel which, in turn, could decide the fate of JumpBox.
With or without the vendors, however, this is a great service and suggests a bright future for enterprise software.
Disclosure: I work for Alfresco and advise several of the companies whose open-source applications JumpBox distributes.
A friend pointed me to news that Magento, a leading open-source commerce platform, has cracked 500,000 downloads, not to mention its 44,000 community members that have translated the project into over 60 languages. That is progress that money can't buy, or at least not cheaply.
But that's only half the story. It has been said that "imitation is the sincerest form of flattery," and the real story behind Magento's success is that it's breeding copycats. Several proprietary competitors, like Oxid eShop, are throwing in the towel and open sourcing their code, too.
The Magento project, founded by Varien in 2001, hasn't been around long, but it's already disrupting the e-commerce market. It's also getting attention from The Wall Street Journal, among others.
Earlier this year I talked up Varien/Magento as a company and project to watch. I was speculating at that time, but today its success seems relatively sure. It's now a question of "how big?" for Magento, not "will it take off?"
Want to sell online? Not Your Average Geeks blog has reviewed nine of the best, including Magento which I reviewed last year.
On Magento, the review notes:
...[M]y what a fantastic job they have done on this product. It's by far one of the more exciting e-commerce platforms available for free on the market today. Dripping with features, they really have thought of everything. Wishlists, shop by price and category, item comparison - all the things we've come to expect from professional web stores. It's software as good as this that really keeps licensed software on their toes...
Indeed. Take a look at the other reviews. A good collection of great software.
Jack Aboutboul at Red Hat clued me into an interesting open-source ecommerce platform today. Called Magento, it's built by Varien and is "a feature-rich, professional open-source eCommerce solution offering merchants complete flexibility and control over the look, content, and functionality of their online store."
Put in English, Magento is an open-source solution for setting up and managing an online store. The product appears to be pretty robust already, but the roadmap looks even better.
If you need to set up an online store, why pay the six- to seven-figures to do so when you can use Magento for free and then pay when you want support going into production?
Those open sourcerors. Why won't they stay in the limited boxes/categories where the 20th-century proprietary vendors want them to remain? Marketcetera, OpenAds, etc. Darned pesky open source kids!
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