Free as in speech, not beer
- Article 5 of 16
- LinuxUser & Developer, September 2005
In the first of a series of articles on the changing market for open source software, Rob Buckley looks at how various companies have met the challenge of making money from the open source software model
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“We are the open source community”
If one open source company is famous for having a marketing message, it’s JBoss and its concept of “professional open source”. Sacha Labourey, general manager of JBoss Group Europe and one of the original founders and developers of the JBoss application server, says the creation of this marketing tag was necessary to convince customers that open source software is viable for enterprises. “Instead of trying to educate people, we decided simply to rebrand,” he says. “Open source is whatever you want it to be, but ‘professional’ is about making money, providing everything you need to use open source in the enterprise.”
In fact, Labourey is quite clear that open source doesn’t mean profit-free. “There is this underlying, almost background noise, about this magic, open source community as though it’s some strange sect, living in the woods, that are against people making money. We consider ourselves the open source community. So when people – usually those who haven’t even touched a keyboard to code - start saying we’re making money on the back of the community, that’s us.”
JBoss began in 2000 when a group of developers gathered on the Internet to create an application server, the eponymous JBoss. “For some, the ambition was to work on transaction management,” recalls Labourey. “Normally, you don’t find that in a job description.” His aim was to prove that he had certain skills so he could start a consultancy in middleware. Although no one originally envisioned creating a company and a product, the developers eventually decided that the best way forward – and to be able to eat and live – was to create a services company based around JBoss and its development.
The Swiss- and US-based JBoss Inc, to give it its full name, now makes money mainly through support contracts and other services. Its subscription support model means that it has extremely stable growth, albeit it conservative. It has, however, refused to sell licences, in part because of the spikes and unpredictability it creates in revenues, but also because it would have reduced the overall user base and popularity of the software. Other business models were equally unappealing. “We looked at releasing the open source server for free and a proprietary, paid-for server for the enterprise,” says Labourey. “But that sends exactly the wrong message to the market: it says open source is fine for small deployments - for children – but proprietary is for adults and the enterprise.”
With a free product that potential customers can download whenever they want, JBoss doesn’t need to have an aggressive sales or marketing campaign. Even with minimal spend in these areas, it has 70% brand awareness in surveys. The core value of the JBoss server remains in the ecosystem around it. With JBoss partnering with as many suitable people as possible, creating projects such as business process management servers that sit on top of the JBoss, it hopes to make JBoss the must-have application server with the killer price: it’s free.
Labourey says that while the company’s business model may differ from most proprietary software vendors’ models in certain aspects, it doesn’t diverge too wildly. Customers still expect product roadmaps and regular updates. “If you can’t develop a sustainable roadmap, companies won’t buy it. They’ll say you have a nice project today, but there is no real R&D being done by your company. Is there going to be a release n+1 or not?”
It’s an issue of control
While JBoss has stayed completely open source with all its software, other companies have chosen to create proprietary products based around open source software. The Karlsruhe, Germany-based company Astaro has created a closed source management platform for open source security packages. Impressed by the quality of the packages, CEO Jan Hichert and co-workers at a German ISP began to deploy the software on various projects. After a few successes, Hichert and the others decided they wanted create a product that would encapsulate these technologies. After failing to raise venture capital, the group begged money from friends and family to launch their company. So they could return the money as quickly as possible, they chose to sell licences for their software, but decided against opening its source.
“I haven’t seen a business model that works without asking money for licences,” says Hichert. “It’s very expensive to integrate these tools as tightly as we do.”
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