Last week I attended the Open Source Think Tank event hosted by The Olliance Group and DLA Piper. There were 100+ invited guests including approx. 40 CEOs from companies with open source offerings and strategies. The companies represented, ranged from startups such as SpringSource and Hyperic to names we all know and love -- Microsoft, IBM, HP, Oracle and Adobe.
Some observations and take aways from the 2 days of conversations:
- Community is king! Open Source Software is about the community, and this doesn't only mean contributors...it means consumers of OSS projects as well -- in fact, the community of "consumers" is arguably the most valuable asset to an OSS project
- License education
- Viable vendor support and productization
- Clear value proposition
- Project and Product maturity
- There really is no such thing as an open source business model
This last "take away" may be a bit controversial so let me explain. It occurred to me half way through the event that most of the issues and concerns I was hearing were no different than what I heard when the internet hit our industry up the side of the head. Today it would be silly to call yourself and "internet" company if you were a vendor -- and you certainly wouldn't tell anyone that you have and "internet" business model. The internet changed our industry but not by creating a new category and new business model -- but rather by changing the way we go-to-market, acquire, retain, and service customers...across all industries. A retailer is still a retailer before and after the internet, same for manufacturers, and service companies. The companies slow to react to the internet lost an opportunity to use this great new tool called the internet for their businesses. The other thing the internet did is create a new tool for new entrants in existing industries -- Amazon, eBay, Google...
I think Open Source Software is exactly the same as the Internet when talking about the impact on our businesses, as software companies. Open Source Software is a great new tool to go-to-market, acquire new customers, and create a loyal and vibrant user community for our products...but a new business model? The companies at Think Tank were not really Open Source companies with new business models they were CRM, Database, Reporting Tools, and Integration Infrastructure software companies. Each of these companies needs to understand their domain, know the difference between users, champions, and buyers of their products, and have a good plan to meet the expectations of these different constituents before, during and after the sale. Some of these companies receive revenue from consulting and training, and some from subscription support, and others are really media companies (SourceForge) that get their revenue via advertising -- are these really new business models in our industry?
What IS different is how this new tool called Open Source Software is used to achieve our ultimate goals of being a successful software companies. How a community is built and kept vibrant, how we acquire customers, our vehicles for revenue (consulting, training, support and no license), and how we approach product development are all different and can be a very powerful differentiator in the markets we all compete in. The most exciting thing about Open Source Software for me is the very real possibility of new entrants and dominant players emerging in existing industries because of their strategic use of
2 comments:
Good points. Your analogy to "internet companies" reminds me of the long-anticipated "client server revolution." There were scads of companies that thought "client server" was an actual market, when in fact it was just a shift in the industry. The companies that capitalized on the change weren't the new "client server" companies, but the established hardware and software vendors that embraced the change and used it to their advantage. A development like open source definitely requires new thinking, but new business models don't always require new companies.
The idea of being your own boss and running your own business is exciting but how many people are successful in actually bringing this dream to realty, tough today internet provides an easy platform to be your own boss. All you need is a good ecommerce solution. http://www.infyecommercesolution.com/ my convenienced.
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