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Open Source Doesn't Need More Support. It Needs Better Business Models

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Jamie Allen, Typesafe‘s Director of Global Services published an interesting point of view on Twitter:

And he’s right of course. We are constantly reminded of the fact that we should support FOSS projects on which we depend. Just recently, Wikipedia had this huge banner on top of it, asking for money, and we probably should. But do we really depend on them, and can we really make a difference? Let us look at the problem from a business perspective.

There isn’t a second Red Hat

About a year ago, there was an extremely interesting article on Tech Crunch by Peter Levine, partner at Andreessen Horowitz who have just invested $40M in Stack Exchange. The article was about Why There Will Never Be Another RedHat: The Economics Of Open Source. It compared Red Hat’s and VMWare’s market capitalisation and revenue with that of Microsoft, Oracle, or Amazon, showing that even Red Hat is a rather insignificant competitor in terms of these size metrics.

Why is this so?

Let’s go back to Groovy: There are probably tens of thousands of Groovy developers out there who have simply downloaded Groovy and then never again interacted with the vendor. It probably wouldn’t even be wrong to say that many developers weren’t aware of Pivotal having been the main sponsor behind Groovy. Sure, Groovy is a strong brand, but it is really “everybody’s brand”, and thus: nobody’s brand. Not being a strong brand, it attracted only techies with language interests (and it is a beautiful language to work with, indeed!)

Now, Pivotal has withdrawn their engagement from Groovy, for completely understandable reasons. Let’s review Jamie’s point of view:

Pivotal’s move to end support of Groovy is a stark reminder that enterprises who depend on FOSS projects should help support them.

Would it have mattered if “we” had supported Groovy?

Perhaps. A Groovy Foundation (similar to the Apache Foundation, or the Eclipse Foundation) might have made Groovy a bit less dependent on Pivotal, and this can still happen. Possibly, a couple of larger companies who depend on Groovy, or Gradle might chime in and become Silver or Gold or Platinum Sponsors, or something like that. Perhaps, Gradleware will seize the opportunity and “buy” Groovy to become THE Groovy company.

But will it work? Does the same work for Typesafe? Can monetising an Open Source language and platform work in times when even C# is now given away for free?

Red Hat can make money off Linux, because Linux is a very complex ecosystem that just requires a support subscription when you’re running it in production. No bank on this planet will ever run a server farm without the vendor promising 24h support with under 1h reaction time. But is the same true for Scala, Groovy? The “critical” work has long been done by the developers. The binaries are built and shipped onto production where operations takes over. Operations couldn’t care less if that binary is built with Groovy, Scala, Java, Ceylon, Kotlin, Fantom, or any of the other gazillion Java alternatives. All operations will ever care about is the JVM, or Weblogic – and the database, of course. And operations is where the long-term subscription money is, not development.

This doesn’t mean that no one should make money from developers. Companies like JetBrainsZeroTurnaround, or also ourselves, Data Geekeryshow that it works, on a much smaller scale. But if a company is “selling” a programming language that doesn’t immediately help them upsell their customers to buy their significant other subscriptions, you should be wary as the vendor motivation to produce the programming language product is very unclear – and in the case of Pivotal, “unclear” is not even close to describe the vendor motivation.

Good examples of holistic platform strategies are these, because operations and the end user can immediately drive the decision chain that justifies the language lock-in for the developers:

  • C# -> Visual Studio -> SQL Server -> Azure, etc.
  • Java -> JVM / Weblogic -> Oracle Database -> Oracle Commerce, etc.

OK examples are these, although the upselling potential might not be viable enough to maintain a whole ecosystem. We’ll see how it works:

  • Kotlin -> IntelliJ

Less good examples are these, because the value proposition chain is really not obvious. There is no justification for the language lock-in:

  • Groovy -> Cloud Platform ??
  • Scala -> Reactive Programming ??
  • Ceylon -> RHEL ??

The Business Model

Jamie Allen’s Tweet shows a lot about what’s wrong with many Open Source vendors. While he claims that end users depend on OSS products from their vendors, the opposite is true. The end user can simply fork the OSS product and lead it to a graceful end of life before replacing it. But the vendor really depends on the goodwill and the benevolence of their FOSS communities. The vendor then tries to leverage goodwill to make a weird-sounding upselling between completely unrelated products. This cannot work.

So join us in our endeavours. Make Open Source a business. A viable business, a business driven by the vendor (and by the market, of course). A business that makes sense. A business that involves dual-licensing and reasonable upselling. A business that uses Open Source mainly as a freemium entry point for the actual business.

You can be romantic about F(L)OSS in your heart, that’s OK. But please don’t depend on it. It would be too bad if you don’t succeed, just because you ran out of money from your “sponsors”, because you didn’t care about the business aspect of your product.

Read also 5 lessons for any open source business transitioning to a revenue-based model

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Published at DZone with permission of Lukas Eder, DZone MVB. See the original article here.

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