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Further thoughts on the decline of ‘open source’ as a competitive differentiatorMatthew Aslett, June 30, 2011 @ 1:12 pm ET
This week’s post on the decreased use of the term ‘open source’ as an identifying differentiator in some companies’ marketing material generated a lot of attention and comment, with numerous industry watchers pitching in their perspectives on the reasons for the decline.
If you haven’t read the original post it might be worth doing so for context before continuing with this post.
Various explanations were offered, any and all of which I agree are partly responsible for the observed decline in our sample. Here’s a selection:
* These vendors are trying to drive the focus of potential users to the commercial version.
* It is happening because companies are focusing on functional value rather than licensing.
* For come companies open source is just a means to an end, while for others it is part of their DNA.
* The proliferation of open source software means that open source licensing is no longer a differentiator.
* Open source is not a business model, and never has been. It remains a differentiating development model.
* These companies are increasingly targeting business decision makers, rather than developers/users, and open source does not resonate as well with that audience.
* Open source remains a differentiator if a product is functionally competitive, but will not overcome a lack of functionality.
* The increased acceptance of open source means these vendors are in a better position to focus on other competitive differentiators.
* The vendors now have ambitions beyond “just” being the leading open source player in their sector.
* Some of these vendors are effectively admitting that their primary products are not aligned with open source/software freedom.
* Some of these companies were never truly open source companies in the first place. They tried to re-brand ‘open source’ and they failed.
While I agree with all of these to some extent, I also believe that the focus on the vendors in my admittedly small and unscientific sample has distracted attention away from the wider trend.
For instance, if we accept that the nine vendors changing their use of ‘open source’ did so because they in particular have matured/learned from experience/failed then we would expect most of the more recent market entrants to be going through the same learning curve/repeating the same mistake.
Let’s take a look at another small and unscientific sample of more recent commercial open source-related vendors (which means we are now dealing with a slightly larger unscientific sample)#:
While all of the vendors in our previous sample had, at some point used ‘open source’ as an identifying differentiator, only eight of this more recent sample have ever done so, and three of those quickly stopped doing so.
This suggests that the trend is not specific to the experiences of the companies in our first sample, but has more to do with the wider industry perception of open source as a competitive differentiator and the changing business strategies around open source software.
Macneil Shonle put it very nicely with his comment that “OSS was once “hot” and appeared to be taking over the world. Companies joined the bandwagon. Cooler heads prevail now.”
This is fundamentally what I have been saying since early 2009, such as this post, which included the first ever mention of Open Source 4.0 and this graphic illustration of the four ages of open source-related business strategies:
The concept of Open Source 4.0 was picked up again late last year in the run up to our Control and Community report, which included an update to the language used to describe the four ages, as well as the opportunity to group the 300 vendors assessed in that report into three groups representing the three vendor-related ages.
Updating the graphic above to include the new language and remove Open Source 1.0 – Traditional Open Source, developed by communities of individuals – we get the following:
Which explains, in theory, why we might be seeing a decline in ‘open source’ as a competitive differentiator: the growth of vendor-dominated open source projects has slowed while the growth of multi-vendor open source and proprietary distributors is accelerating. We have moved beyond the era of the ‘open source vendor’.
That’s the theory anyway. Having recently updated the results of our analysis to the end of 2010 and 321 vendors, we can also see what is happening in practice:
So I wasn’t far off…
#Of course there is still an inherent bias in our sample. The only way to avoid that would be to look at all 320+ companies we cover but – believe it or not – I have better things to do.
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