CAOS Theory Podcast 2011.09.30

Topics for this podcast:

*Cloud M&A potential around OpenStack
*Oracle’s commercial extensions for MySQL
*Puppet Labs rolls out Enterprise 2.0, hosts PuppetConf
*Basho bolsters Riak distributed data store in NoSQL race
*Our latest special CAOS report, ‘The Changing Linux Landscape’

iTunes or direct download (25:59, 4.4MB)

MySQL at the core of commercial open source

Oracle last week quietely announced the addition of new extended capabilities in MySQL Enterprise Edition, confirming the adoption of the open core licensing strategy, as we reported last November.

The news was both welcomed and derided. Rather than re-hashing previous arguments about open core licensing, what interests me more about the move is how it illustrates the different strategies adopted by Sun and Oracle for driving revenue from MySQL, and how a single project can be used to describe most of the major strategies from generating revenue from open source software.

Like most open source-related software vendors, MySQL started out life offering support, training and consulting around the open source database. The company also saw success in offering a closed source variant of the database for embedding in closed source systems, and it was this dual licensing strategy that drove much of the company’s early revenue. That began to change with the arrival of MySQL Enterprise (initially ‘MySQL Network’) – a subscription offering that delivered monitoring and (later) backup capabilities to paying customers only. While some people see this as an example of the open core licensing strategy, as we have previously explained, it is not. While open core is an extension of the dual licensing strategy with additional extensions, MySQL AB’s MySQL Enterprise, as the graphic above illustrates, actually paired the extensions with the open source MySQL Community – a subtle difference from the MySQL Enterprise licensing strategy adopted by Oracle (more of which later).

MySQL flirted with the open core licensing model in early 2008 with plans to introduce new features into Enterprise Edition that would not be available under an open source license. Those plans were ultimately reversed at the behest of new owner Sun Microsystems. To understand why Sun did this one must consider the company’s wider strategy for open source at the time. While a software freedom philosophy played a part, Jonathan Schwartz’s map of open source downloads, each representing ‘a potential customer that cost Sun nothing to acquire’, explains how Sun was less interested in driving direct revenue from MySQL (and other open source software) as it was in helping open source users to become customers for Sun’s commodity hardware and other products and services. (Although as Henrik notes in the comments, Sun did also increase MySQL direct revenue as well).

Sun never got the chance to prove whether this model would have worked (I’m being polite), but in any case contrast Sun’s approach with Oracle’s strategy for open source. While the majority of Oracle’s revenue clearly comes from other products, it is not looking to drive revenue for those products via open source downloads. Witness Larry Ellison’s recent proclamation that he doesn’t care if Oracle x86 server business (typically used to run MySQL) goes to zero. Instead (for better or worse) the company is focused on driving revenue directly from each individual product, whether that is a high margin server, or closed or open source software. That has resulted in an increased investment in embedded opportunities for MySQL, as well as traditional software license agreements. While customers might choose to use MySQL Community and purchase additional support subscriptions, as of November 2010 Oracle prefers that Standard Edition and Enterprise Edition customers enter into a commercial license agreement with the company. That was a strategy that was in place in advance of last week’s addition of high availability, scalability and security features, but one that clearly looks set to continue.

Whether this is a good or a bad thing depends on your perspective. Monty Widenius does a good job of outlining the down sides to an open core licensing strategy, while Giuseppe Maxia focuses on the positives. Certainly Oracle will have to be mindful to balance the control and community aspects, but as we have previously covered (451 Group clients) there are a number of new capabilities in development for the core MySQL database itself. It is also worth noting, incidentally, that MySQL Enterprise Edition remains priced at $5,000 per server per year.

Economy up or down, can open source come out on top?

We’ve written about how a bad economy is indeed good for open source software. We’ve also recognized that with open source software’s maturity and place at the enterprise software table, a bad economy can be a double-edged sword for open source since the failure or fade of large enterprise customers, say big banks, hurts open source vendors right alongside traditional software providers.

What is interesting is that after a couple of years of economic rebuilding, we’ve seen recently how open source is being driven by innovation, particularly in cloud computing, where open source is prevalent and disruptive, and also mobile computing, which continues to be impacted by openness.

Given recent economic developments around the globe, I’m wondering whether we may see a return of cost as the main driver and benefit of open source software in the enterprise. Recent conversations with vendors and customers illustrates the fact that the motivation for adopting open source is not always the main benefit from open source. For example, open source users and customers identified cost as the main reason for adopting open source when we asked more than 1,700 of them two years ago. However, when the same group was asked what was the main benefit from open source, the top pick was flexibility. We also saw dramatic increases in factors such as performance and reliability when comparing drivers for adoption and benefits from adoption. Still, just as we’ve seen unpaid community Linux lead to paid subscription Linux and also paid Linux lead to more unpaid community Linux use, it can go both ways with open source advantages, as well. One recent conversation with an up-and-coming, open source-centered vendor in the NoSQL space highlighted how many large enterprise customers are deploying open source in divisional, departmental, pilot and other limited form to replace traditional databases primarily for flexibility, performance and similar reasons, but finding the cost savings to be significant and worthy of wider deployment.

This begs the question whether open source software, driven by its myriad of advantages for different contexts, finds a way to win regardless of whether economic conditions are good or bad? There’s no question open source has displayed staying power throughout both. We should also point out that these advantages and factors end up putting a lot of pressure on open source software development and projects, given there are inherent expectations of cost-savings, flexibility, speed, performance, scalability, etc. As we’ve highlighted recently, open source is not always the correct route for enterprise ogranizations. However, we do believe that if done properly, open source projects and communities can and do deliver benefits that enable both providers and consumers of technology.

Similar to sales and marketing, longevity, economic and developer opportunity, open core, etc., it all boils down to the community, which in a good economy tends to drive innovation and value or in a bad economy serves as a source of cost efficiency, savings and survival. That is, of course, if the community is properly supported in code, cash, contributions and stewardship that still allows open source to do its thing.

The rise, fall and reality of commercial open source

We’ve been writing ourselves about the move toward more permissive licensing in commercial open source, as well as a lessening of the use of ‘open source’ as an identifier or differentiator. We’ve also seen others comment on a perceived loss of significance and importance of free and open source software and open standards. Combine this all with some typical observation on the lack of contribution back to open source software projects, and it might appear that open source software is a once-mighty empire in the midst of decline. However, from my perspective it seems despite all of this, open source software has never before been as pervasive, disruptive and innovative as it is right now. While we have yet to reach open nirvana, open source software is playing a pivotal role in the two most significant software markets currently: cloud computing and mobile computing.

Much of the gloom and doom in open source software the last couple of years has centered on the evil that is ‘open core,’ yet I have been among those contending that open core and the mixing of open source and proprietary models is often something that customers want. In addition, rather than just a matter of converting much or all that open source community goodness to cold hard cash, I believe all of these trends and perspectives support the idea that open source software is actually gaining in significance. Whether it is viewed as an effective marketing mechanism may be another thing, but the fact that open source is prevalent in the two hottest categories of IT today: cloud computing and mobile devices.

We’ve written extensively about open source software’s prevelance in cloud computing. We’ve also covered how the many, critical open source pieces of cloud computing stacks, whether SaaS, IaaS or PaaS, are also having an impact on openness and discussions of it, something we also see when considering recent partnerships and a changing landscape for Linux and open source software.

We’ve also covered the significance and prevalence of open source software in mobile computing. At the same time, we recognized that while open source software was a key ingredient to most if not all mobile software platforms and application ecosystems, there was a lack of open source software reaching end products and users.

In both cases, there are reasons and incentives for ‘going closed,’ so to speak, but it is the true open source efforts that elicit true community benefits: collaboration, transparency, speed, flexibility, security and more. So while open source as a term or identifier may not be what matters most to vendors or customers, there is no question open source is key to the business and future of many, if not most vendors in cloud and mobile computing. Ask Puppet Labs or Chef sponsor Opscode whether open source matters to their customers and their business. Ask Google whether openness is something they consider as they move forward on Android and Chrome. Ask Rackspace whether open source is critical in its open source cloud computing stack, OpenStack. Ask HP whether it is meaningful that WebOS is open source. I have. It is. So the next time we hear about the surrender, retreat, fade or decline of open source software or its importance in today’s computing landscape, just remember that today’s key markets tell a different story.

451 CAOS Links 2011.04.15

VMware launches Cloud Foundry. Red Hat heads for Ceylon. And more.

Follow 451 CAOS Links live @caostheory on Twitter and, and daily at
“Tracking the open source news wires, so you don’t have to.”

# VMware launched Cloud Foundry Platform-as-a-service and open source project.

# Red Hat’s Gavin King revealed details of the company’s Ceylon project.

# Red Hat submitted a number of specification requests for Java EE 7.

# Terracotta accused Red Hat of “trying to pull a fast one” with its data cache JSR.

# Zencoder, the company behind the open source VideoJS viewer, raised $2m in funding.

# OpenStack distribution provider Midokura raised $1.3m in seed funding.

# 10gen’s MongoDB is a core data service in VMware’s Cloud Foundry (along with MySQL and Redis).

# Tuxera has merged the NTFS-3G and ntfsprogs projects, creating its new Tuxera NTFS Community Edition.

# Nuxeo released a Google Search Appliance plugin.

# Opsview updated its Opsview Enterprise open source IT monitoring software.

# Joe Brockmeier presented six public relations lessons for open source projects.

# Couchbase spun off its CouchDB hosting business as Iris Couch.

# Neo Technology explained why Neo4j Community (now at version 1.3) is now GPLv3.

# SkySQL introduced a reference architecture for deploying MySQL or MariaDB databases.

# Jive Software acquired Proximal Labs.

# Gluster Virtual Storage Appliances now support KVM and Xen.

# Talend’s Ross Turk shared his perspective on balancing open core and community.

# Percona announced its roadmap for Percona Server and XtraBackup.

# Support for Flock browsers will be discontinued as of April 26th, 2011.

CAOS Theory Podcast 2010.11.12

Topics for this podcast:

*Our latest CAOS Special Report – Control and Community
*Red Hat releases RHEL 6
*Symbian and Oracle highlight community challenges
*The latest on government adoption of OSS from GOSCON
*Open core issue continues, now with Linux and evil twins

iTunes or direct download (31:02, 8.5MB)

Is MySQL open core?

Or, how we evaluate a company’s open source-related business strategy.

Godwin’s law states: “As an online discussion grows longer, the probability of a comparison involving Nazis or Hitler approaches”.

An online discussion about open source-related business strategies is no exception. However, long before the Nazi comparison it is inevitable that someone will ask “is MySQL open core?”.

I updated our 2009 post “what is open core, and what isn’t” recently, and received some criticism of my statement that the MySQL strategy was not open core.

Since we have recently published a report including the results of our analysis of the open source-related business strategies of 300 vendors and subsidiaries it seems appropriate that we use this opportunity to explain how we evaluate a company’s open source-related business strategy, and specifically how our analysis led us to conclude at the time of our analysis (August/September) that the open core licensing strategy did not apply to MySQL.

Given the recent changes to MySQL pricing and licensing we have also revisited our analysis, see below.

Looking at MySQL Enterprise it is easy to see why so many people conclude that the product licensing strategy being applied to MySQL is open core, since MySQL Enterprise contains extensions for which source code is not available that are not available with MySQL Community.

However, it is important to remember that products are not open core – and companies are not open core – but that open core is a product licensing strategy applied by companies to products. Therefore the question “is MySQL open core?” is inappropriate. A more appropriate question would be, “is the product licensing being used with MySQL open core?”

It is also worth noting that a product licensing strategy is just one of five elements that we at The 451 Group use to evaluate an open source-related business strategy.

The five elements we consider are: the software license for the open source software; the development model for the open source software; copyright ownership for the open source software code; the product licensing strategy; and the revenue generator. Specifically, with regards to MySQL, our evaluation went as follows:

Software license/development model/copyright ownership:
This was a relatively straightforward process for the MySQL business. The MySQL Database software is available under the GNU GPLv2, a strong copyleft license, and although the code is available at Launchpad, clearly the software continues to be developed in the cathedral model by a core group of developers, mostly employees of a vendor: Oracle. The same vendor also owns the copyright.

Product licensing strategy:
This is where things started to get a little bit difficult. Historically MySQL AB used the dual licensing strategy, making a version of MySQL Server available under a closed source license (aka selling exceptions) for enterprises. That strategy remains in use today to enable the use of MySQL embedded in closed source software. However, the version of MySQL Server in MySQL Enterprise was not closed source, and was the same GNU GPL version as MySQL Community. This provides a good example of why it is important to assess the licensing strategy, rather than the product: the open core licensing strategy uses dual licensing and adds closed source extensions to create a closed source version that is a superset of open source software (or from another perspective, an open source version that is a subset of closed source software). Since this description did not apply to MySQL Enterprise, which saw the open source MySQL Server delivered along with closed source extensions, we concluded that Oracle did not use an open core licensing strategy with regards to MySQL.

Revenue generator
The description of MySQL Enterprise, used above (open source software with additionally capabilities delivered via subscription) is exactly what we consider a value-added subscription revenue generator. There are often many ways in which a vendor generates revenue from open source software. MySQL is just such a case: Oracle generates revenue from closed source licenses embedded in closed source software, but the largest generator is the MySQL Enterprise value-added subscription.

The MySQL strategy includes a strong copyleft software license, vendor-developed software using the cathedral model, and vendor-owned copyright. That much was easy. It was also easy to identify the dominant revenue generator, which was value-added subscription. That left the product licensing strategy, for which the choices were single open source (in MySQL Enterprise) and dual licensing (for embedded usage). To select single open source would be inaccurate since we could not ignore the fact that the MySQL business uses a dual licensing strategy.

MySQL Reconsidered:
In the light of the recent licensing and pricing changes for MySQL we took the opportunity to talk to Oracle about the licensing of MySQL. What we discovered was that whereas the MySQL Database previously accompanied by the MySQL Enterprise subscription was licensed using the GNU GPL, Oracle now prefers that Standard Edition and Enterprise Edition customers enter into a commercial license agreement with the company (although they will apparently be able to negotiate subscription usage with MySQL Community). This is a licensing agreement that does not impact the functionality or code of the MySQL Database itself, although clearly there continues to be additional functionality delivered with the MySQL Standard and Enterprise subscriptions, such as MySQL Enterprise Monitor and MySQL Enterprise Backup.

This changes our perspective of the MySQL-related strategy on two levels, Firstly, with regard to the revenue generator, we can now conclude that going forward the biggest revenue generator for Oracle from MySQL will be closed source licenses. While this closed source software will still be delivered via a subscription agreement, our support subscription and value-added subscription categories are reserved for products that use an open source license. It also changes our perspective on the product licensing strategy. Specifically in that our description of open core used above, (dual licensing + closed source extensions to create a closed source version that is a superset of open source software) does now apply to MySQL Standard and MySQL Enterprise.

Open core licensing is free software’s evil twin

Or, why free software advocates love to hate open core

I’ve been trying to figure out why it is that free software advocates are so fixated on the open core licensing strategy and recently came to the conclusion that there is only one explanation: open core is free software’s evil twin.

To clarify I do not believe that open core is evil, but that the relationship between free software and open core is the equivalent of the literary device where two protagonists share certain characteristics (such as general appearance) but have inverted moralities and visual differentiators (usually a goatee beard).

Spock and Evil Spock, image courtesy of Dave Friedel. See also Evil David Hasselhoff, aka Garthe Knight.

If we look at the relationship between open core licensing and free software we also see common characteristics along with diverging moralities.

With regards to the common characteristics witness the fact that the two strategies are united by a dependence on strong copyleft licensing.

According to our recent research on open-source-related business strategies 67% of vendors utilizing the open core licensing strategy are associated with a project that uses a strong copyleft license. We have also found that 52% of vendors taking a single open source licensing approach to open source use a strong copyleft license.

Looking at it another way we see that 30% of vendors associated with strong copyleft licenses are using open core licensing, while a very similar number – 29% – of vendors associated with strong copyleft licenses are using single open source licensing.

That is where the similar character traits end and the differences begin.

While free software projects utilize strong copyleft to ensure that the software in question remains open, vendors using the open core licensing strategy use strong copyleft licenses, along with copyright ownership, to ensure that only they have the opportunity to take it closed.

While 83% of vendors utilizing the open core licensing strategy are associated with a project for which the vendor owns the copyright, 88% of vendors associated with foundation-owned copyright were using open source licensing.

Meanwhile 56% of vendors taking a single open source licensing approach were using the bazaar development model, compared to 61% of those taking an open core approach using the cathedral development model.

Similarly 43% of vendors taking a single open source licensing approach were using the community-led development model, compared to 80% of those taking an open core approach using the vendor-led development model.

Finally, while 96% of vendors utilizing the open core licensing strategy generate the largest proportion of their revenue from closed source software, 32% of those associated with single open source licensing generate revenue from support subscriptions, and the same proportion from ad hoc support/services.

The evil twin theory doesn’t explain why the debate is so enduring however, or why free software advocates seem to be so fixated on open core. That is unless you add in the theory that the twins are also symbiotically dependent on each other.

You don’t have to look hard for evidence that open core is dependent on free software – the statistics above demonstrate how open core related to the strong copyleft licensing strategy – but what of free software’s dependence on open core?

It seems to me that in a world where the line between proprietary and free and open source is increasingly blurred advocates of free software are becoming increasingly dependent on open core as the bogeyman to define the line and differentiate the free software approach. Where once ‘proprietary’ was considered the opposite of free, now it is open core that is considered the opposite of open source.

The dependence has gone so far, in fact, that we have seen examples of free software advocates labeling projects and vendors as open core, even when they are not, in order to highlight the benefits of a pure open source approach. Witness Bradley M Kuhn and Alexandre Oliva attempting to pin open core’s goatee beard on Canonical and the Linux kernel respectively.

If we look back at the creation of the term ‘open core’ it was coined in order to provide an alternative to terms such as ‘bait and switch’. In hindsight it was inevitable that the negative connotations would simply be applied to the new terminology.

What wasn’t obvious was how important open core would become to the software freedom movement in articulating the benefits of software freedom. That is why free software advocates love to hate open core, and that is why the open core debate will endure.

Open core by the numbers

Given the ongoing and recently increased interest in the open core licensing strategy there have been numerous statements made about its relative popularity, the reasons for its adoption, and the impact it has on collaborative development.

As part of our recently released report on the evolution of open source-related business strategies we evaluated the strategies of 300 companies that are engaged in generating revenue from open source software.

This gives us an opportunity to provide some statistics to complement the numerous opinions about open core licensing. Since this is a topic that is difficult to discuss without being accused of bias, I will let the numbers speak for themselves:

• 22% of the 300 vendors assessed in the report are utilizing open core licensing

• 10% of the 286 open source users surveyed expressed a preference for open core

• The open core licensing strategy has a user friendliness rating of 34.7, and a vendor friendliness rating of 77.0 according to our analysis, meaning that it is over-utilized by 42.4 (all figures rounded)

• The formation of vendors using the open core licensing strategy peaked in 2005 and declined in 2006 and 2007, before leveling off in 2008 and increasing slightly in 2009 (2010 in chart below is for Q1-Q3)

• 67% of vendors utilizing the open core licensing strategy are associated with a project that uses a strong copyleft license

• 80% of vendors utilizing the open core licensing strategy are associated with a vendor-led development project, and just 12% with community-led projects.

• 61% of vendors utilizing the open core licensing strategy are using the cathedral development model, and 30% the bazaar development model

• 83% of vendors utilizing the open core licensing strategy are associated with a project for which the vendor owns the copyright

• 96% of vendors utilizing the open core licensing strategy generate the largest proportion of their revenue from closed source software

• 30% of vendors associated with strong copyleft licenses are using open core licensing, compared to 29% using a single open source licensing strategy

• 29% of vendors associated with weak copyleft licenses are using open core licensing, compared to 25% using a single open source licensing strategy

• 12% of vendors associated with non-copyleft licenses are using open core licensing, compared to 43% using a single open source licensing strategy

• 36% of vendors associated with cathedral-led development projects are using open core licensing, compared to 28% using a single open source licensing strategy

• 15% of vendors associated with bazaar-led development projects are using open core licensing, compared to 34% using a single open source licensing strategy

• 37% of vendors associated with vendor-led development projects are using open core licensing, compared to 28% using a single open source licensing strategy

• 8% of vendors associated with community-led development projects are using open core licensing, compared to 35% using a single open source licensing strategy

• 36% of vendors associated with vendor-owned copyright are using open core licensing, compared to 27% using a single open source licensing strategy

• 57% of vendors generating revenue from closed source software are using open core licensing

• 36% of venture-backed open source specialists are using the open core licensing strategy, compared with 28% of specialists that have not taken VC funding

• 34% of specialist open source vendors are using the open core licensing strategy, compared to 1% of complementary vendors

Make of that what you will. Discussion of what we think it all means, and the strengths and weaknesses of the open core licensing strategy can be found in Control and Community.

Governments want more commercial out of commercial open source

The theme of this year’s GOSCON, from my perspective, was that governments remain eager to embrace open source software, and are no doubt already doing so in many cases, but there is still a great demand for more commercial backing of more open source. Even though we continue to see more official adoption and procurement of open source among public organizations, it seems clear after GOSCON there is a need for more awareness, but also for more commercial support of open source.

Governments are already accustomed to collaboration and are less competitive when it comes to IT. And while open source is a natural fit for this type of IT market, open source remains a mismatch in many regards. For example, the try-before-you-buy approach typical for open source software is quite contrary to typical government adoption, requests for proposals (RFPs) and procurement practices. We’ve known for some time that in order to use open source software, many government organizations simply treat it as ‘commercial off the shelf’ (COTS) software. However, we continue to see immense opportunity for commercial supporters, backers and service providers centered on open source software — particularly in places, such as government and also healthcare, financial services, insurance and telecommunications — where there are certifications, requirements, approvals and specific processes and procedures for those wishing to sell software and services. These are the ideal tasks for a vendor, which has the structure and discipline to cut through the bureaucratic red tape, and less ideal for software developers, who rightfully should be focused on the code, rather than certifications for it.

We see an increasing awareness of this opportunity, particularly in government sales channels, where system integrators such as Autonomic Resources, Momentum SI and others are adopting, incorporating, supporting and providing open source software to customers. This is also the subject of a special 451 Group Spotlight report to be published soon.

Yet, based on my conversations and interactions at GOSCON and others in the public IT sector, there are still many government users that are ready and willing to use open source software, but need more commercial assurance behind it. At the same time, as indicated by our recent research on business models and the demands of customers and vendors, users and customers want multi-vendor and community open source software. I believe this highlights the desire for the continued assurance and option of a community version, but there is also demand for commercial backing, particularly in government. Just as this desire for flexibility ranging from a free, community version to an enhanced, more scalable, supported or feature-rich paid version can be a factor of customer demand for open core models, I believe government customers want the full range of options, particularly paid options so they can satisfy public agency adoption and procurement requirements.

CAOS Theory Podcast 2010.10.29

Topics for this podcast
*Latest release and support for OpenStack, Austin code release
*Development and devops consolidation continue with CollabNet-Codesion
*Funding for a number of open-source-focused players
*Open core, Canonical and the ongoing discussion
*OTRS provides open source helpdesk and service management

iTunes or direct download (27:08, 7.3MB)

What is open core licensing (and what isn’t) UPDATED

This is an updated version of a post that was originally published in July 2009. It has been updated in response to ongoing confusion about open core licensing.

There has been a significant amount of interest in the open core licensing strategy since Andrew Lampitt articulated it and its benefits for combining open source and closed source licensing.

There remains considerable confusion about exactly what the open core licensing strategy is, however, which is strange since the term arrived fully packaged with a specific definition, courtesy of Andrew. Recently I have begun to wonder whether many of the people that use the term open core regularly have even read Andrew’s post.

I feel somewhat responsible for this given that our Open Source is Not a Business Model report was partly responsible for the increased use of the term open core, and since I remembered that it was this post about commercial open source strategies that prompted Andrew to define open core in the first place.

Additionally, since business models related to open source are evolving constantly, I thought it was worth revisiting the definition of open core and putting it in some context.

What is open core?
According to Andrew’s original post it is a licensing strategy whereby a vendor combines proprietary code with open source code, where “the commercial license is a super-set of the open source product, i.e., it offers premium product features that you will not see in the GPL license”.

At first Andrew was very specific about the use of the GPL license and a development model dominated by a single vendor. However, it quickly became clear that a company like EnterpriseDB, which provides proprietary extensions on top of the community-developed, BSD-licensed PostgreSQL database, also fits the general model.

Therefore, Andrew clarified that there were Vendor Controlled (VC) and Community Controlled (CC) variants on open core.

Incidentally, Andrew did not create the open core strategy. As he himself admitted, he “invented nothing, just articulated it”. Credit goes to Barry Klawans and Paul Doscher (Jaspersoft co-founders), as Andrew noted.

In fact our research indicates that the formation of companies using the open core licensing strategy had already peaked by the time the term was coined – but more on that another day.

What isn’t open core
Sometimes it is easier to define what something is by explaining what it isn’t. Open core is a commercial open source strategy, but just as “all of Alma Cogan is dead, but only some of the class of dead people are Alma Cogan”, not all commercial open source strategies are open core (and more specifically, given recent statements, not all strategies that involve copyright agreements are open core – more on that another day as well).

So, to clear up some apparent confusion:

  • Red Hat’s strategy is not open core

Red Hat reserves support and features for paying customers, but it does not do so using closed source licensing (a prerequisite of open core). Instead Red Hat gives away the source code but withholds the compiled, binary version for paying customers.

(N.B. Beware companies claiming to be following “The Red Hat model” as they invariably aren’t – most often I find they mean that they use a subscription revenue model. Very few companies have copied Red Hat’s model for a variety of reasons – a subject I’ll leave for another post.)

  • Dual licensing is not open core

In fact, as Andrew Lampitt explained in his definition, open core is a variant of dual licensing (or proprietary relicesing, as some like to call it, or indeed “selling exceptions”). The important thing to note is that in the dual license strategy a single code base is available under an open source or closed license, while with open core the closed source licensed code is a superset of the open source code. Both result in closed source software, but only in the open core strategy is the closed source version functionally different from the open source version.

  • The MySQL strategy is not open core (yet)

One of the reasons for the confusion is that MySQL originally started out with a dual license model but changed over time to the subscription revenue model, and flirted with open core. At this point the strategy for MySQL remains dual licensing. It remains to be seen whether the MySQL Server code for Enterprise Edition 5.5 will be different from Community Edition with the inclusion of MySQL Enterprise Backup (which would make it open core) or if the new capabilities will be delivered as a subscription service.

  • Subscription strategies are not open core

Although they are a step in that direction. The subscription model provides vendors with a mechanism to distribute value-added features to paying customers. Until now the additional capabilities in MySQL Enterprise (such as Enterprise Monitor) have been delivered as a service via the MySQL Enterprise subscription. Although the code for Enterprise Monitor has not been made available, we would see this strategy as distinct from open core since open core results in a product with a different code base, where as the MySQL Server code in Enterprise and Community is the same. To differentiate from regular support subscriptions I have used the term value-added subscription to refer to this type of subscription. Other examples include Canonical’s Ubuntu Advantage and Nuxeo’s Connect. I would also put Red Hat Network and JBoss Operations Network in this category, although the source code for those value-added services was originally closed, it has now been made available as open source (as previously discussed).

  • Open foundation is not open core

Vendors such as IBM, Cisco, Oracle and SAP (in fact just about every software vendor) include open source code within larger closed source software packages and hardware products. There is a fine line between the two, but as I previously explained while open core involves offering proprietary extensions targeted at a segment of the open source project user base, open foundation involves using open source software to create entirely new products, targeted at a different user base.

  • Microsoft’s open source strategy is not open core

Microsoft is undoubtedly making use of more open source and encouraging open source development on its platforms, but its strategy is by definition not open core since it is extremely unlikely the core will ever be open source. In fact, as previously discussed, Microsoft’s strategy turns the open core strategy on its head by encouraging open source development around a commercial core, and has been described by Microsoft as open edge, and by Andrew Lampitt (more amusingly) as open crust. We have adopted the term open edge to describe this strategy and have seen it adopted by a small number of players beyond Microsoft.

Fear and loathing and open core

Bradley M Kuhn published an interest blog post at the weekend explaining why he believes Canonical is about to go down the open core licensing route and heavily criticising the company for doing so.

My take on the post is that it is the worst kind of Daily Mail-esque fear mongering and innuendo. Not only does Bradley lack any evidence for his claim, the evidence he presents completely undermines his argument and distracts attention from what could be a very important point about copyright assignment.

The premise? Mark Shuttleworth has admitted that he plans to follow the open core licensing strategy with Canonical.

The evidence? Mark praises the strategy Trolltech took of selling proprietary licenses.

The problem? Trolltech did not follow the open core licensing strategy. Neither did MySQL, which Bradley suggests inspired Trollech’s strategy.

Both MySQL and Trolltech utilised a dual licensing strategy, which means that the same code base is available under on open source license or a closed source license (also known as “selling exceptions”. This is not open core licensing, although it is related since open core sees vendors dual licensing and offering extensions only available in the closed license version.

A significant difference between dual licensing and open core is that Richard Stallman has explained why, in his opinion, it is okay to sell exceptions to GPL code via a dual licensing strategy. In fact one of the examples he uses is… Trolltech.

So Trolltech is not open core. Or is it? Perhaps it depends on how you define it. Bradley has claimed, at least twice, that there is no agreed definition of open core.

If that were true you could forgive his confusion, but it clearly not. In fact the term open core was delivered fully packaged with a specific definition, courtesy of Andrew Lampitt. As I previously noted, you have to wonder whether many of the people that use the term open core regularly have even read Andrew’s post.

Since Mark’s comments about Trolltech are the only evidence put forward that Canonical is going open core I’m not going to debate that any further.

It is worth considering a couple of other claims Bradley makes, however – such as the idea that Nokia abandoned Trolltech’s business model. It is pretty clear that a company like Nokia has very different motivations and business drivers compared to a company like Trolltech. A strategy that works for Nokia does not mean the strategy that worked for Trolltech was wrong.

However, it is worth noting that in fact Qt business continues to operate the dual licensing strategy. What has happened is that the company has added a new LGPL option and launched a public repository for the software and abandoned the previous requirement for copyright assignment.

This is not a change in business strategy – this is a change in the licensing, development and copyright strategies. Just because Nokia is in a position to open up the development project to encourage more collaborative development (which I agree is a beneficial arrangement for everyone) does not mean that Trolltech’s closed development strategy wasn’t successful.

Undoubtedly Trolltech’s insistence on copyright assignment limited its outside contributions, but copyright assignment does not equal open core, despite Bradley’s insistence that there is “no other plausible & logical conclusion”.

We saw a similar reaction last month in reaction to Diaspora’s copyright assignment policy. However, open core is by no means the only possibility. Dual licensing is another. And as we have seen that comes with RMS’s own seal of approval… except where it results in a version of the code that is only available as closed source (such as open core).

Richard Stallman’s advice on that issue is to “insist that the contribution agreement require that software versions including your contributions be available to the public under a free software license. This will allow the developer to sell exceptions, but prevent it from using your contributions in software that is only available under a proprietary license.”

This is good advice for any developer concerned about open core, and this is the message that gets lost amid Bradley’s anti-open core agenda.

It is absolutely fair to ask why Canonical demands copyright assignment, but to insists that the only reason that they do so is because they are going open core, especially on such flimsy and misleading evidence, is scaremongering and distracts attention from the real issue – which is copyright assignment.

It should be noted, incidentally, that Bradley and Mark have some previous when it comes to copyright assignment, which was also, I believe, caused by confusion rather than malice.

See also this poston the difference between copyright assignment and participation agreements.

451 CAOS Links 2010.10.05

Microsoft sues Motorola. Oracle says no to LibreOffice. Time to fork Java? And more.

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“Tracking the open source news wires, so you don’t have to.”

# Microsoft is suing Motorola over alleged Android patent infringements.

# Oracle confirmed to SJVN that it will not be working with the Document Foundation on LibreOffice.

# Sean Michael Kerner reported that Red Hat has settled an alleged patent infringement case with IP firm Acacia Research.

# Greg Luck asked if it is time to fork Java. As did Sacha Labourey.

# Black Duck Software acquired from Geeknet.

# Samsung confirmed that it is dropping support for Symbian.

# xTuple introduced email integration via Feature Mob sponsored feature offering.

# Dana Blankenhorn reported on the rise of business communities.

# Cloudera is building a two-way connector for high-speed data movement between CDH and Aster Data nCluster.

# Ascensio System announced an AMI of its open source project management and collaboration platform TeamLab.

# Percona launched worldwide 24×7 support for MySQL.

# The Software Freedom Conservancy appointed Bradley M. Kuhn as its full-time Executive Director.

# The Register reported that Canonical is adding OpenStack APIs to Ubuntu.

# An overview of the Linux Foundation’s open compliance program.

# Alfresco released Alfresco Community 3.4 with new tools and services for Spring developers.

# Bernard Golden discussed cloud computing, open source, and the next generation of applications.

# Kitware received an $11m contract from DARPA as part of its Video and Image Retrieval and Analysis Tool program.

# Citrix released XenClient version 1.0.

# Peter Ganten said open core is over.

# Dirk Riehle presented his thoughts on the current state of open source business research and future directions.

The future of open source licensing

There has been plenty of discussion around our recent post arguing that we have entered a new era of open source commercialisation strategies.

“Open source 4.0”, characterized by corporate-dominated development communities, is upon us with increased emphasis on collaborative development for non-differentiating code. In comparison the previous era was dominated by vendors that eschewed the potential advantages of collaborative development in favour of control over the future development of the project.

The shift has occurred, as Matt Asay notes, “because the world has sorted out where competitive advantage lies (e.g., data), and is therefore willing to collaborate on non-differentiating code while keeping everything else firmly proprietary”.

We noted in our previous post that the participants in these corporate-dominated development communities are not necessarily vendors and that we are seeing increased involvement of companies that we would traditionally think of as consumers of software, rather than contributors.

However, it is worth noting that a significant proportion of the vendors that we see involved in these communities (and certainly those that we expect to benefit most commercially from lowered R&D and indirect revenue opportunities) are traditional closed-source vendors.

The shift has also occurred at a time when we see a surge in opposition to open core strategies in which the dominant vendor makes closed-source extensions available to paying customers. As Matt explains, this has led to a somewhat surreal scenario in which opponents of open core are celebrating a shift towards a model that favours the traditional closed-source software vendors.

The situation has also given cause for concern, with Glyn Moody highlighting that the Apache licence is being widely adopted for new projects and that “anyone can take the code and turn it into a proprietary offering.”

Glyn argues that this “is worse than the GNU GPL with copyright assignment”, where a single copyright holder is able to provide a closed-source version. Is it really worse to have a situation in which everyone has an equal opportunity to go closed-source than one in which the control and power lies with a single vendor?

Either way, Glyn also notes that the ability of the copyright holder to act as a monopolist is “hardly what Richard Stallman had in mind when he drew up the GPL”. This is probably true, but it should be noted that Stallman has defended selling license exceptions (also known as dual licensing), which is the practice that enables vendor-controlled open core strategies (which Stallman opposes).

In fact, it is worth considering that the issues that seem to cause the most controversy around open source-related business strategies – vendor-controlled open source projects, open core licensing, copyright assignment, and dual licensing – are all perpetuated by copyleft and the GNU GPL.

It doesn’t have to be the case that the GNU GPL leads to a dominant open source vendor, of course. Glyn explains how assigning copyright to a non-commercial entity, such as the Free Software Foundation, avoid this problem. Another approach (although one that has problems of its own), is to ensure that individual contributors own the copyright to their own contributions.

Glyn makes a case for the GPL combined with copyright assignment to a non-commercial entity being the preferred option for corporate-dominated development communities, arguing that “it produces a completely level playing-field for companies. Anyone can take that GPL’d or LGPL’d code and use it as the basis of a commercial offering; however, no company can gain an advantage over any other by offering a closed-source version too.”

It is interesting that offering a closed-source version is seen as providing an advantage. I would argue that a situation in which everyone is able to offer a closed-source version creates the same level playing-field. While it is perfectly possible for a vendor to take without giving, doing so negates the benefit they would gain from being part of an ongoing collaborative development process.

From a commercial perspective, the incentive is to share non-differentiating code. In comparison there is little or no incentive for vendors to create non-commercial entities for copyright assignment. The ability to create closed-source versions, and/or offer complementary closed-source software and services, is one of the main commercial drivers for vendors taking the corporate-dominated development community approach.

Non-vendors may well have an incentive for preventing commercialisation of their efforts, but while we see increased involvement of non-vendors, it is still likely to be traditional closed-source vendors that dominate these communities.

The GPL is certainly not going away any time soon (any more than we have previously discussed) but commercial incentives mean that non- and weak-copyleft licenses are highly likely to be the licenses of choice for the projects that define open source 4.0.

UPDATE – I am, of course, generalizing here. Carlo Daffara provides an excellent analysis of the factors that influence license choice, including existing code requirements and intellectual property. – UPDATE

We explain more about our theory of the evolution of commercial open source in Control and Community, the follow-up to our Open Source is Not a Business Model report, which is now available. The report provides more context for the economic motivators and issues involved in the various models, as well as updated research on which vendors are following which strategies, and why, as well as a survey of 286 open source software users to uncover what they make of it all. The report will be freely available to CAOS subscribers. For more details of the CAOS research practice, and to apply for trial access, click here.

451 CAOS Links 2010.07.30

Adobe to acquire Day Software. Gnome contributors. Oracle bad, Oracle good. And more.

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“Tracking the open source news wires, so you don’t have to.”

# Adobe agreed to acquire Day Software for $240m.

# Dave Neary published Gnome census, including a list of the top company contributors. , which prompted the following…
# Greg DeKoenigsberg – Red Hat, 16%. Canonical, 1%
# Jeffrey Stedfast – Re:Red Hat, 16%. Canonical, 1%
# Jono Bacon: – Red Hat, Canonical and GNOME Contributions
# Carlo Daffara – About contributions, Canonical and adopters.

# Oracle rebrands Java, breaks Eclipse. Oracle demonstrates great community support and fixes Eclipse.

# Dell and HP will certify and resell Oracle Enterprise Linux, Solaris and Oracle VM on their respective x86 platforms.

# Oracle reportedly shut down servers Sun had contributed to the build farm for PostgreSQL.

# Whamcloud is a new venture-backed company formed around the Lustre distributed file system.

# Openbravo reported that new downloads of its open source ERP software have increased 320% in five months.

# Mitchell Baker provided an update on Mozilla’s search fro a new CEO.

# Nuxeo updated Nuxeo Digital Asset Management and released Nuxeo DAM – Cloud Edition.

# CodeWeavers released CrossOver 9.1 and CrossOver Games 9.1 for both Mac and Linux.

# Rapid7 is sponsoring and partnering with w3af, the open source Web application attack and audit framework.

# Brian Proffitt said don’t be too quick to dismiss open core.

# Tarus Balog explained why he thinks open core is dead.

# Nagios Enterprises gained more than 200 Nagios XI customers in the first half of 2010.

# Former Sun distinguished engineer Bryan Cantrill joined Joyent as VP of engineering.

# The Indonesian Ministry for Research and Technology estimated that migration to OSS could save state as much $400m.

# Novell said reports SuSE Linux losing share to Ubuntu are nonsense.

# The GNOME Release Team pushed the GNOME 3.0 release to March 2011.

# Convirture released version 2.0 of the Enterprise edition of its ConVirt virtualization management software.

# Sourcefire launched Razorback, a framework for multi-vendor threat detection and protection.

# Qualys released BlindElephant, an open source web application fingerprinting engine.

# Contegix agreed to sponsor the Clojure development language project.

# vtiger unveiled vtiger CRM On Demand, the cloud-based version of its open source CRM software.

# Jos Poortvliet joined Novell as openSUSE Community Manager.

# Funambol introduced DM Carrier Edition an open source device management offering for WiMAX.

# Sony Pictures Imageworks and Industrial Light & Magic developed Alembic, an open source exchange format.

# The Register reported that Canonical will integrate Hadoop and NoSQL database technologies with Ubuntu 10.10.

# The Open Invention Network experienced 35% growth in licensees during the second quarter.

# OpenSAF released version 4.0 of its high availability middleware platform.

Hybrid licensing strategies for open source monetization

One of the issues that has arisen from the ongoing debate about the open core licensing strategy is the continuing confusion about open core compared to the use of open source components in a larger proprietary product – such as IBM’s use of Apache within WebSphere.

To some people there is no difference between the two (since they both result in products that make use of open source but are not open source), however it is clear to me that while the end result might be the same these are very different strategies that involve different approaches to engaging with open source communities/projects.

While open core has a clear definition there is no agreed term or definition for the latter category.

Over the years we have used a variety of terms to describe it, including “open and closed”, “embedded open source”, “open inside” and “open complement”, while Jack Repenning has referred to it as “open infrastructure”.

Our next categorization of open source-related business strategies is still a work in progress but the current thinking is as follows:

  • There are a variety of complementary strategies employed by vendors to generate revenue from open source software indirectly.
  • The simplest of these is open complement which is selling other products and services that are related to but separate from, and not reliant upon, the open source project.
  • Then there is encouraging open source development on top of proprietary products to retain develop interest in that product. This is known as open edge.
  • Then there is using open source software to create a platform for the provision of SaaS or cloud or social networking services (for example), which I am referring to as open platform.
  • Then there is using open source components as building blocks for a larger proprietary software product, which I am calling an open foundation licensing strategy.

(This categorization is a work in progress, we welcome and encourage any feedback)

Open core and open foundation have different evolutionary lineages: open core is a variation on dual licensing as practiced by the likes of MySQL and Sleepycat that also borrows heavily on the value-added subscription model as practiced by Red Hat and JBoss. Meanwhile open foundation has its roots in the commercialization of BSD, which pre-dates the concepts of open source and free software, as well as Apache.

From a practical perspective, the easiest way to think of the distinction between open core and open foundation is via an example:

PostgreSQL is an independent, community-developed open source project. EnterpriseDB offers extensions to the PostgreSQL core, such as Oracle-compatibility, in the form of Postgres Plus Advanced Server.

PostgreSQL has also been used by many other vendors to create commercial products. For example Greenplum used PostgreSQL as the foundation of its Greenplum Database (for other examples see this post). This allowed the company to build on proven database technology and avoid reinventing the wheel, but it also involved the creation of an entirely new product, rather than extensions to an open source project (the company initially actually started a new project, Bizgres, and created extensions to that but Bizgres was last seen in August 2008).

So while open core involves offering proprietary extensions targeted at a segment of the open source project user base, open foundation involves using open source software to create entirely new products, targeted at a different user base.

The example used above highlights three important points to consider when comparing open core and open foundation strategies:

1/ While open core is most readily associated with vendor-controlled projects it can also be used as a strategy to monetize community-controlled projects.

2/ Open core strategies can be used in conjunction with complementary strategies. In the Greenplum example the company’s relationship with Bizgres was open core, while the relationship with PostgreSQL was open foundation. Similarly there is an open core relationship between Actuate’s BIRT products and the Eclipse BIRT project, and an open complement relationship between Actuate 10 and the Eclipse BIRT project. Meanwhile there is an open core relationship between Day Software’s CRX content repository and the Apache Jackrabbit and Sling projects, and a open foundation relationship between CQ5 and Jackrabbit, Felix and Sling – as well as the numerous other Apache projects that Day contributes to.

3/ Open core and open foundation are licensing strategies used as part of a larger business strategy for engaging with and commercializing open source software, which highlights the futility in trying to pigeon-hole companies as “open core vendors” or “open source vendors”.

Finally it is worth thinking about the different tensions that the open core and open foundation strategies create with their respective communities.

As Jorg Janke notes, “looking for an income stream as an open source vendor always results in some sort of conflict with the community. So, you have to pick the community you want to ‘offend’.”

With a vendor-controlled open core strategy the community is a user community, and as we have previously discussed the conflict is in deciding what features belong in the core and what features don’t.

With an open foundation strategy the community is the open source project developer community, and the conflict lies in deciding what features and resources to contribute to that project.

A community-controlled open core strategy arguable results in conflict with both the user and developer communities, although since the vendor does not own or control the project the relationship is much more comparable to the open foundation strategy.

We will be writing more about other strategies for generating revenue from open source software, in a follow-up to our Open Source is Not a Business Model report, which is due to be published latter this year. It will provide more context for the economic motivators and issues involved in the various models, as well as updated research on which vendors are following which strategies, and why, as well as a survey to uncover what software users make of it all. The report will be freely available to CAOS subscribers. For more details of the CAOS research practice, and to apply for trial access, click here.

451 CAOS Links 2010.07.27

New projects. Old arguments. And more.

Follow 451 CAOS Links live @caostheory on Twitter and
“Tracking the open source news wires, so you don’t have to.”

New projects
# Gemini Mobile Technologies released Hibari, a new open source non-relational database for big data.

# Lockheed Martin launched the Eureka Streams open source project for enterprise social networking.

# Sony Pictures Imageworks expanded its open source initiative with the release of OpenColorIO.

Old arguments
# Kirk Wylie discussed the importance of natural split in open core , OpenGamma’s approach.

# Alan Shimel offered 10 commandments for open core. Mostly sensible, #6 will ruffle some feathers though.

# Simon Phipps maintained that open source does not need “monetising”.

# Carlo Daffara discussed property and efficiency as the basis of OSS business models.

# Jorg Janke continued his discussion of various open source business strategies in relation to Compiere.

# Henrik Ingo explained what you can do to help get rid of open core if you are so inclined.

# dotCMS went open core with the release of version 1.9.

# IBM faces EU antitrust investigation linked to TurboHercules complaint.

# The FT reported that IBM is blaming Microsoft for the EU investigation into its mainframe business practices.

# TechDirt explained how WordPress and Thesis have settled their differences over themes and the GPL.

The best of the rest
# Novell introduced SUSE Gallery for publishing and sharing Linux-based appliances.

# VoltDB released version 1.1 of its open source database.

# EnterpriseDB released Postgres Plus Advanced Server 8.4 and added Rob Bearden to its board.

# SAP has adopted Black Duck’s Suite to manage the use of open source software in its software development process.

# Oracle provided details of the MySQL Sunday event at Oracle Open World.

# SearchEnterpriseLinux reported that Ubuntu is gaining ground as a data center OS at the expense of SUSE Linux.

# explained how Georgia Institute of Technology researchers are helping the US military benefit from OSS.

# GENIVI Allianced has reportedly opted for MeeGo for its in-vehicle infotainment platform.

CAOS Theory Podcast 2010.07.23

Topics for this podcast:

*OSCON conference highlights and impressions
*Rackspace and NASA open source more of cloud computing
*Open core debate du jour
*Open source motors Rhomobile’s multi-smartphone development software

iTunes or direct download (27:39, 7.6MB)

451 CAOS Links 2010.07.23

The post-OSCON lull. In alphabetical order.

Follow 451 CAOS Links live @caostheory on Twitter and
“Tracking the open source news wires, so you don’t have to.”

# Canonical launched a virtual appliance of IBM’s DB2 Express-C software running on the Ubuntu cloud platform.

# Carlo Daffara discussed the relationship between open core, dual licensing and contributions.

# ForgeRock released OpenAM 9.5, the first community-sourced release of the OpenAM access management software.

# Ignacio M. Llorente provided an overview of the OpenNebula project, in the context of OpenStack.

# Kaltura launched version 2.0 of Its on-prem Community Edition open source video platform.

# Nuxeo announced Nuxeo Correspondence Management, a new application built with Nuxeo Case Management Framework.

# Open Source for America has grown its membership from 70 to 1,700 in its first year.

# Outerthought released a proof of concept for Lily, a content repository that combines Apache Hbase and Solr.

# Sauce Labs announced Sauce OnDemand, enabling cross-browser testing of Adobe Flex and Flash in the cloud.

# Savio Rodrigues explained why OpenStack will not kill open core.

# SugarCRM announced it will release open source functional and performance testing tools for web-enabled apps.

# Terracotta announced Ehcache 2.2, offering over a terabyte of data in a single cache.

# The Apache Software Foundation announced Apache FOP Version 1.0.

# The open core issue (part two) How the open core strategy works, and how it doesn’t.