Recession be damned. The first quarter of the year saw a record US$203.7 million of venture capital flow to young open source companies. You'd think that would be a cause for celebration, but for too many members of the open source community money is, well, icky.
I pick that word deliberately, because the snarky elitists who want to keep open source pure -- and poor -- remind me of children. Case in point: MySQL. Not long before the database company was scooped up by Sun, at great profit to the founders and employees, there was a lot of nastiness about the decision to make a small set of features in WorkBench available to paying customers only.
Imagine that. Asking people to pay for something useful. "Frankly, there are people who call themselves part of the MySQL community that have never contributed a line of code or paid them a dime," says Matt Asay, vice president of business development at Alfresco, an open source content and document management company. Asay, a frequent blogger, notes that other companies, including SugarCRM and Zimbra are also offering some closed extensions "as a way to get a decent percentage of customers to pay, and then reinvest the money in writing great code."
Now think about people who use open source products for free. On the one hand, the use of software by large numbers of people and large companies validates it and makes it seem like a safe choice. And that's a good thing.
"Unfortunately, this cuts the other way, as well: The more free-riders, the more encouraged would-be purchasers will want be to free-ride as well. Why should you be the only sucker paying for what everyone else is using for free, and quite comfortably?" says Asay. "Ultimately, someone must pay for software in order to have it written. It doesn't grow on trees and it doesn't grow on communities, either," he adds.
The free-loving purists could kill open source
Charge for support? Of course; nobody I know thinks that's a bad idea. But what happens if those paying customers decide they don't need the support after a while, asks Open Sources blogger Savio Rodrigues. "I've spoken to many customers who are saying 'We bought support for two years and realized we just didn't use it as much as we thought. Also, with the source code being available, my software developers can support our use of product XYZ internally,'" he wrote in a recent post.
Rodrigues goes on to note that "for the majority of single-vendor backed OSS [open source software] products, there is virtually no cost savings versus developing closed-source software. To close the feature/function gap, OSS vendors need faster revenue growth to fund this development expense," he wrote. "The OSS vendor community needs leaders who will stand up to 'the community' and make the tough business decisions needed to ensure that OSS isn't relegated to a small revenue slice of the software industry pie."
Incorporation into the mainstream or militant separatism?
Daniel Lyons, AKA the fake Steve Jobs, made a fascinating point in Forbes earlier this year. He likened the growing acceptance of open source in the commercial world to the incorporation of parts of gay culture into the mainstream.
Elaborating on that theme, 451 Group analyst Matthew Aslett says: "The assimilation of any subculture or counterculture into the mainstream is a divisive moment -- signaling as it does both the success of the movement in reaching a wider audience, and the watering down of its principles by external forces. There are signs that an identity crisis is already impacting the free software and open source software movements."
That's a great point. Open source has tentacles of influence everywhere, touching on mainstream software companies from IBM to -- gasp! -- Microsoft. See for example a discussion of how open source influenced Windows Server 2008 by Microsoftie Sam Ramji.
Is that bad? I'd say no. If anything, it's a tribute to the quality of thinking behind open source projects. And so is the huge flow of capital from VCs to young open source companies. Those investments, of course, are predicated upon the possibility of a decent return. And that means those companies have to make money. As Asay puts it, "Open source is getting to the point where business models will vary greatly. It's not the end of the world."