In May, I reported on the rising fortunes of Funambol, Mozilla, and other open-source companies. Signs of "green shoots" notwithstanding, the economy doesn't seem to be getting any better, but open-source companies continue to log impressive growth as open source pervades the enterprise, as Forrester analyst Jeffrey Hammond (@jhammond) recently noted.
Importantly, according to Hammond, while open source starts as a cost-saving exercise, it often morphs into something far more strategic:
[O]rganizations tend to start [with the goal of saving money with open source]. And then what tends to happen is the more that they become comfortable with using open source, and the more that they apply it successfully, the more they start to realize that there are benefits other than cost savings that they can take advantage of. And that's when you start to see them turn from open source opportunists into open source advocates.
Those "advocates" are funding the payrolls of a range of open-source companies. Here are just a few examples of those benefiting from this enterprise shift to open source:
- The VAR Guy (@thevarguy) reports that both xTuple and Sopera are profitable. While he doesn't comment on how much they're doing in sales, profitability is, in itself, a significant achievement. (Alfresco, my company, is also profitable, and I'm sure there are others. Please let me know.)
- Likewise, an open-source authentication and identity management company, announced that it is on track to record 100-percent sales growth in 2009. We'll call that a "pre-announcement."
- MuleSource, an open-source Service Oriented Architecture (SOA) company, reported "another record for the company, with a 140 percent year-over-year increase in quarterly bookings and over 100 percent growth for the year-to-date period."
- MindTouch, not to be outdone, also issued a release highlighting its revenue growth (without giving any gee-whiz statistics but did us the favor of providing a pretty graph). More interesting, however, is MindTouch CEO Aaron Fulkerson's (@roebot) review of the various things the company has done right and wrong in commercializing its open-source collaboration project (Spoiler: favoring an enterprise build over a "community build" via stability and support is a bad idea).
(Credit:
MindTouch)
- Meanwhile, though not financial reports, it's encouraging to see Kuali adoption take off in earnest within higher education. "The colleges involved say they have the potential to achieve millions in savings while gaining more control over technology systems that are essential to the smooth functioning of their institutions." Nice.
- Also, a member of the Perl community looks to Canonical's Ubuntu in search of a solid revenue model for Perl. Interesting read, though I'd probably look to foundations that have proved their financial mettle like Mozilla and Eclipse before I'd emulate Ubuntu, however much I may respect what Canonical is doing with Ubuntu.
Unfortunately, most open-source companies are private so the "earnings" reports are somewhat self-serving and mostly unverifiable. Still, it's good to hear of growth in the midst of a weak economic climate.
Disclosure: I am an adviser to MindTouch and MuleSource. I'll gladly report on other financial successes in the open-source world if you care to send them to me....
Follow me on Twitter @mjasay.
MuleSource, the company behind the top open-source enterprise service bus (ESB) and a leading open-source service-oriented architecture (SOA) vendor, has been without a chief executive for some time, having lost the services of CNET blogger Dave Rosenberg in September. On Monday, the company announced the appointment of Greg Schott as its new CEO.
Schott may familiar to those who follow the sometimes-incestuous open-source talent pool. That's because Schott joins MuleSource from SpringSource, where he was senior vice president of marketing.
Prior to joining SpringSource, Schott had served as senior vice president of marketing and vice president of corporate development at Agile Software, which Oracle acquired in 2007.
At SpringSource, Schott led the company's rebranding efforts from Interface21 to SpringSource, as well as the complete overhaul of the company's marketing, a difficult feat in a start-up with such impressive engineering chops as SpringSource has.
Schott joins MuleSource at a good time. The company has delivered 100 percent year-over-year revenue growth and now counts more than 2,000 enterprise deployments at major enterprises like Wal-Mart Stores. The company just completed its best quarter ever, and it named MySQL sales executive Mark Burton to its board of directors.
Schott is a good fit for engineering-heavy MuleSource. He has technical chops, and a wealth of marketing and operations experience. I'm biased, as I'm an adviser to the company, but I'm also a good friend of Rosenberg, MuleSource's former CEO and co-founder.
Disclosure: As noted above, I am an adviser to MuleSource.
Follow me on Twitter at mjasay.
Nestle's Nespresso division, a Switzerland-based global leader in coffee, with more than 1,700 employees and sales into 50 countries, had the kind of problem most companies would love to have: growth. As its traditional retail channels moved online, it found it difficult to scale its systems to be able to manage its online growth.
Enter MuleSource, with its open-source Enterprise Service Bus (ESB) technology, Mule. In conjunction with a leading open-source system integrator, Optaros, the two put together a highly scalable services-oriented architecture for Nespresso that makes the coffee drip on time:
Nespresso engaged Optaros and MuleSource to help its corporate architecture team define and implement a new middleware architecture called Nespresso Open Architecture, or NesOA. This new modern architecture is based on service-oriented architecture (SOA) principles, including fully decoupled systems that support both synchronous and asynchronous integration.
With these capabilities, Nespresso's IT infrastructure can now enable new distribution channels, improve business agility, cope with increased transaction volumes, and more easily introduce new applications and services, as needed.
Sounds great, but it's especially telling that the initial implementation took only six months, a testament to the lightweight, open approach that open-source projects like Mule offer enterprises.
But open source isn't just a short-term time saver. In fact, its biggest benefits may come from increased flexibility down the road, as Nespresso's Joel Schmitt, an enterprise architect, declares in a case study describing Nespresso's deployment:
We are committed to an open-source approach, including MuleSource's Mule ESB, because complying with open standards is key for future extensibility and growth...With our new architecture, we have been able to add flexibility and agility to our system landscape.
In this case, Optaros and MuleSource delivered cost and flexibility benefits, but the same types of benefits are being discovered for a wide variety of applications by enterprise IT.
Disclosure: I am an adviser to MuleSource, and my employer, Alfresco, partners with Optaros. I do not, however, drink coffee, so theoretically, I'm biased against Nespresso. :-)
I was confused when Dave Rosenberg told me that he was leaving MuleSource to pursue a game startup. "But you are already the CEO of a startup," I remonstrated. Given his longstanding interest in video games, however, it was probably just a matter of time.
Of course, that was nothing next to my confusion when I kept reading about Digium-founder Mark Spencer hanging out with Marc Fleury, working on an open-source home automation project called OpenRemote. The OpenRemote blog suggests that Digium remains Spencer's primary home, but that he moonlights as the principal hardware designer for OpenRemote.
This morning Dries Buytaert of Drupal/Acquia fame confused me further by announcing Mollom, a "startup Benjamin Schrauwen and [Buytaert] began to help keep your website free of spam."
I asked Jeff Whatcott, vice president of Marketing for Acquia, the company that Dries co-founded, whether Dries was still fully engaged with Acquia, and he told me,
... Read moreThere are some notable omissions from Linux Magazine's list of the top-20 companies for 2008 (MuleSource, MySQL, etc.), but it's an interesting list because it doesn't read like a standard list of open-source companies. Or, rather, it takes a more expansive, "Long Tail" view of what an open source company is.
Hence, the list includes the usual suspects like Alfresco (correctly reading that Alfresco is a serious threat to Sharepoint's growing dominance), Mozilla, Ubuntu/Canonical, Red Hat, and rPath, but also Google, Yahoo!, and...Microsoft.
... Read more
Ever stay up late wondering what MuleSource does? Oh, come on! You know you do! Well, TechWeb TV has an interview with Dave Rosenberg, CEO of MuleSource (and a good friend that I'm hoping to humiliate through this), on MuleSource, its customer mix, company statistics (adoption rates, number of customers, etc.), and its licensing and business model. (You can also see a clip on Groundwork.)
The interview with Dave provides some interesting insight into IT buyer behavior relative to open source.
Must have been a bit disconcerting for Dave to record, but worthwhile to watch, even if you're not interested in an Enterprise Service Bus.
Disclosure: I am an advisor to MuleSource.
Network Appliance's latest earnings report is fascinating. Dan Warmenhoven, NetApp's CEO, reported that enterprise spending is on the wane, with the financial services industry allegedly battening down the hatches and sitting out a soft economy.
If true, I suppose this is bad news for NetApp and many other enterprise IT companies (though it doesn't seem to have made a dent in Microsoft or Oracle). For open-source companies? It's manna from heaven. $1 saved on proprietary, pricey IT may well convert into $.50 spent on open-source software...which goes a long way for the new breed of open-source vendors.
But first, Mr. Warmenhoven's commentary:
(The enterprise spending weakness) is led by the financial services sector as you might imagine and they're quite substantial. But other companies are still as well....It was a challenge this year.
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I wouldn't have believed it, but Matthew Aslett has the numbers to prove it:
Red Hat is a consolidating force in the open-source world, after all.
One trend that emerged very quickly is how much of a driving force... Red Hat has been [a driving force in] acquiring both open source and proprietary vendors.
There have been 72 mergers and acquisitions involving an open source software acquirer or target (or both) according to [The 451 Group's] figures.
... Read more
Whether you have any fun listening to this new podcast, I had a lot of fun recording it with two good friends, Ashlee Vance of The Register and Dave Rosenberg, CEO of MuleSource. Ashlee asked us a few weeks ago whether we'd want to do a podcast on open source. I normally wouldn't find this interesting, but given The Register's take on life, I thought it would be fun.
And it was, as Ashlee notes:
There's no shame in admitting that we've turned punditry into an art form with this first episode, which runs about an hour. We talk about Microsoft's attempts to live the open source lifestyle, the apocalyptic horrors of Web 2.0 and its effect on the open source lifestyle and Oracle's issues with open source eroticism or simply open source schisms. Take your pick.
We also have a look at the new CPA license, the Google backlash, Hadoop, SugarCRM and MySQL's IPO prospects, XenSource, VMware, Openads and Marketcetera. Who could ask for anything more?
Have a listen. I think you'll enjoy it. If you don't, let me know and tell us what we should be chatting about. I think we're going to have Mark Shuttleworth with us on the next one, so at least some intelligence will crop up on the meat cast from time to time.
We answer to a higher authority
(Credit: ConAgra)My good friend, Dave Rosenberg (CEO of MuleSource), has finally capitulated to the open-source gods and has licensed MuleSource's software under the nearly the exact same license as before (CPAL instead of MPL+attribution), only this time it's blessed by the Open Source Initiative (OSI).
It's like the hot dogs we buy in the Asay home: Hebrew National. I don't know that they're any different from any other hot dogs, but I like the fact that a rabbi blesses them and guarantees there aren't any non-kosher things in them (like rat hair and excrement).
Anyway, MuleSource ("Our open-source ESB answers to the OSI") is now blessed as open source, and Dave does a fine Q&A with himself to discuss the move, and why MuleSource didn't capitulate to my GPL (GNU General Public License) fetish. In the self-interview, Dave captures a fair amount of the good and bad in open-source business today, and manages to be a lot more interesting than most interviews.
... Read more
