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  1. #1
    WHT-BR Top Member
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    Dec 2010
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    [EN] There's no money in open source

    Rail against profiteering and raise the timeworn example of Red Hat all you like, but building a viable business around 'real' open source is as dicey as it's ever been

    Matt Asay
    Feb 12, 2016

    Former MongoDB CEO Max Schireson wants to point you to “the money in open source software.” The problem, however, is that there isn’t money in open source software.

    Oh, sure, there’s Red Hat. But name a single other example. You can’t, because there isn’t one.

    To the extent that “open source companies” strike it rich, they’re not doing it with open source. They’re selling the opposite of open which, it turns out, may be the best open source business model of all.

    Getting open source wrong

    Not that everyone believes this. Open Source Initiative director Simon Phipps execrates Schireson’s perspective, accusing him of “a worldview that refuses to recognize the real value of open source.” Phipps also (rightly) uncovers a number of factual errors in the article.

    But what Phipps doesn’t do, at least not persuasively, is uncover any countervailing truths about open source as a viable business model. This isn’t, of course, his primary concern: Phipps cares about coders, not capitalists. But his argument is still fundamentally wrong when he suggests, “Red Hat clearly proves you don’t have to ... monetiz[e] open source software … [by] creat[ing] artificial scarcity to ape the models of legacy corporations.”

    Because, let’s face it, that’s precisely what is required, even for Red Hat.

    While today all of Red Hat’s code is open source, that wasn’t always the case. Red Hat Satellite, which for years was the foundation for its revenue model, was purely proprietary until 2008. It took Red Hat well over a decade to get around to open-sourcing that key technology. By then, every competing Linux vendor was toast, and Red Hat’s (trademarked) brand offered all the intellectual property it needed.

    That and the ability to de-risk otherwise complex open source software. As then-Red Hat CTO Brian Stevens once told me:

    Red Hat's model works because of the complexity of the technology we work with. An operating platform has a lot of moving parts, and customers are willing to pay to be insulated from that complexity. I don't think you can take one finite element - like Apache - and make a business out of it [using our model]. You need product complexity.

    This has worked great for Red Hat. It has not worked at all for anyone else -- which brings us to proprietary value, the foundation for every so-called open source company.

    Faking open for fun and profit

    The most successful open source companies today, like Cloudera or DataStax, don’t actually sell open source software. They sell proprietary value around it. Sure, you can buy a support subscription, but this is generally conflated with enterprise features and other hold-backs that prod customers to pay.

    This isn’t evil. It makes sense. Otherwise these same open source companies that do the vast majority of development on a project are forced to spend all their resources competing with themselves. I’ve done it for 15 years. It’s hard.

    Where the model starts to resemble “evil” is when it pretends to an openness that simply isn’t there. Apprenda CEO Sinclair Schuller nails this when he derides “open-source projects and foundations controlled by a single company [that use] a less than genuine ‘openness’ to advance the goals of a single organization.” Schuller calls out a few that range from highly controlled to weakly controlled:


    This table from the Web publication The New Stack reveals that the lion's share of open source contributions typically come from a software companies.

    As he rhetorically asks, “How open can software be when a single organization drives the majority of the contributions?”

    The other mechanism -- one that Schireson calls out -- is to impose a heavily restrictive open source license that is effectively radioactive to would-be contributors to the code, though generally safe for downstream users of the code. Such licenses, like the AGPL, serve as the equivalent of a proprietary license.

    Which brings us back to Phipps: He argues, “VCs who miss the point of open source shouldn't fund it,” but I’d argue something more fundamental. Entrepreneurs shouldn’t try to monetize open source ... ever.

    The companies that make the most money from open source software don’t sell it: Think Google, Facebook, and other giants that heartily embrace open source without having to sell a single line of it. Instead they sell services based on open source.

    Nor are they alone. Dig into the code base for any proprietary product today, from any software or hardware vendor on the planet, and I guarantee it’s riddled with open source. These companies are selling open source. They’re using (and often contributing to) it, but then selling something completely different.

    That’s where the real money is: proprietary value built on top of open source. There are lots of different ways to do it, but that’s the fundamental principle.
    http://www.infoworld.com/article/303...en-source.html

  2. #2
    WHT-BR Top Member
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    Dec 2010
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    Hortonworks seeks salvation in proprietary software

    Once Hortonworks seemed bound and determined to pursue the 'pure' open source model. Now reality is finally setting in

    Matt Asay
    Feb 29, 2016

    Three years ago Hortonworks led a chorus of open source Kumbaya as it sought to differentiate itself in the rapidly growing Hadoop market. Today, Hortonworks has significantly changed its tune, embracing proprietary software as a way to improve its financials.

    The only shocker here is that it took so long.

    Last month I declared that "there's no money in open source." While open source has become essential for every business, selling open source software is an exercise in self-hurt and business-model gymnastics. Hence, the most successful open source companies aren't open source companies at all: They're companies like Facebook that liberally embrace and contribute open source code, but don't sell it.

    Hortonworks tried to beat these odds and follow Red Hat, the one company that has managed to build a profitable, ever-growing open source software business. Though the company has delivered impressive top-line revenue growth, it remains far from profitability in a fiscal environment that increasingly demands sustainability. With Hadoop adoption nearing 100 percent, according to Forrester, Hortonworks needs to find a better model for getting paid for all that adoption it has helped to foster.

    Enter proprietary software

    As reported by The Wall Street Journal, Hortonworks "will [soon] offer proprietary software, built by other companies or in partnership with Hortonworks, that would run on an open source platform." While the company appears to be trying to keep its hands unsullied from that proprietary software by having others develop the code that it sells, it's definitely a big shift in strategy.

    After all, this is the company that fretted about proprietary software fragmenting the Hadoop ecosystem and chided those that adopted an "open core" model. But this is before the company got spanked for having to raise another $100 million to cover its continued losses on a give-it-away-and-pray-they-pay business model.

    More than a year ago I insisted this model wasn't sustainable for any but Red Hat. Hortonworks seems to agree and paves the way for the company to further accelerate its path to profitabilty.

    ... kind of, sort of proprietary

    Not surprisingly, Hortonworks isn't waving the proprietary banner too high yet. Shaun Connolly, vice president of Strategy for Hortonworks, stresses that this shift is very much still being defined: "It could evolve to enable us to be a marketplace for partners to sell their value-add, and it could be commercial," meaning Hortonworks could end up bundling the proprietary software with its Hadoop distribution.

    Connolly was quick to add that this wasn't a land-grab by Hortonworks: "As we evolve our model, we want to make sure there's something in it for our ecosystem. That's our DNA."

    But the same could be said of Cloudera, MapR, and other Hadoop competitors that haven't eschewed proprietary software. Each is trying to grow the overall Hadoop pie, even as it claims as much of the revenue as possible for itself.

    No, what's at stake is Hortonworks' ability to profitably grow that pie, and this move positions it much better to do exactly that. This is a good move by Hortonworks for the company and its shareholders, but also for the broader big data ecosystem.

    The world's biggest contributors to open source, Facebook and Google, make their money selling proprietary services that run on top of open source software. Their contributions depend upon that proprietary cash. Now Hortonworks will have a proprietary revenue stream, too. That ultimately means more great open source code -- and that's a very good thing.
    http://www.infoworld.com/article/303...-software.html

  3. #3
    WHT-BR Top Member
    Data de Ingresso
    Dec 2010
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    14,981
    As then-Red Hat CTO Brian Stevens once told me:

    Red Hat's model works because of the complexity of the technology we work with. An operating platform has a lot of moving parts, and customers are willing to pay to be insulated from that complexity. I don't think you can take one finite element - like Apache - and make a business out of it [using our model]. You need product complexity.

    This has worked great for Red Hat. It has not worked at all for anyone else -- which brings us to proprietary value, the foundation for every so-called open source company.
    Como assim?


  4. #4
    WHT-BR Top Member
    Data de Ingresso
    Dec 2010
    Posts
    14,981

    Solution Brief: The Easiest Way to Build and Manage an OpenStack Cloud

    Surprise, surprise!

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    Download this solution brief to learn about:

    • The challenge of building an OpenStack cloud
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    • BootStack, a service provided by Canonical to build and manage an OpenStack cloud


    http://connect.softlayer.com/Web-SB-...kCloud-TY.html

    BootStack — your managed cloud

    The BootStack service gives you an OpenStack private cloud, running on your hardware, in your choice of datacentre with Canonical responsible for design, deployment and availability. We’ll even train your team and, when it suits you, hand over operational control.

    ...

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    http://www.ubuntu.com/cloud/openstack/managed-cloud


    How Ubuntu OpenStack helps Service Providers succeed

    Canonical has eyes on 65% of the largest OpenStack deployment in the world, as per the latest OpenStack Foundation survey. This is the reason we are able to build OpenStacks that are resilient and reliable, distilled experience of the hundreds of production clouds we have been involved in and still support.

    OpenStack evolves as fast as Ubuntu, with a matching release cadence, allowing us to deliver the latest of OpenStack development at production level faster than anyone else. These new versions of OpenStack, and its open nature, will guarantee your range of choices. Our OpenStacks are also resilient and upgradeable thanks to our unique reference architecture.



    Última edição por 5ms; 06-03-2016 às 09:00.

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