Open Source Positioning July 18, 2005Posted by Sacha in JBoss, Moved from JBoss.org.
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As I was thinking about the way companies (mostly software vendors) position
towards Open Source, I realized I could try to categorize them.
Here is what I came up with:
- The truly committed
- The mixed-codebase
- The pragmatics
- The anti-strategist
- The headless chickens
- The in-denial
- The anti-OSS
The first category, the “truly committed”, bundle companies that make
of Open Source their principal strategy. This category has gained increased
attention from CxO and has already won support from a massive number of
developers. The clear advantage of such a positioning is that it is very easy
read. Examples of such companies include Red Hat, MySQL and obviously JBoss, but
also a growing number of smaller companies trying to find their way through
similar business models. We could certainly split that specific category in
sub-categories, depending on the way software and services are being developed,
distributed and monetized, but that is a different topic.
The second category, the “mixed-codebase”, gathers companies with an
increasing commitment to an Open Source strategy but that also have some
existing critical revenue streams to protect, and hence cannot simply switch to
a full OSS strategy overnight. “Mixed-codebase” companies not only deploy on/use
Open Source software (as an ISV), but also actively contribute to (or even lead)
OSS projects and have some clear OSS alliances reinforcing this strategy.
Examples of such companies include Novell and Computer Associates. I mostly see
the “mixed-codebase” category has a transition step: companies will eventually
move to category 1 (successful transition) or 3 (retrenchment), depending on how
well they execute their transition, how well they can convert their existing
revenue streams, how frequently they change their CEO, etc. I do not know of any
company that would have successfully switched from a traditional company to a
category 1 company yet. My bet is that such a thing will take place in the next
The third category, the “Pragmatics”, communicate a lot about
their love of Open Source even though they usually only contribute marginally to
OSS projects (if at all). These companies mostly develop proprietary software
(ISV) and deploy it on (and make use of) Open Source software as a way to maximize
their target market. This is a very comfortable situation to be in as it is a
cheap way to advertise you have an OSS strategy, surf on the OSS wave and not
take too much risk. This strategy is specifically interesting if you don’t
really feel threatened by an Open Source competitor on your own market segment.
A well-known example is Oracle and their commitment to Linux as a deployment
The fourth category, the “anti-strategist”, are frequently confused
with the second category (the “mixed-codebase” companies) as they share lots of
common attributes (contribution to OSS projects, etc.) but are fundamentally
different. While the “mixed-codebase” see OSS as something that will actively
drive the strategy of the company (go-to-market, product development,
monetization, etc.), the “anti-strategists” mostly use OSS as a way to fight
competition (“anti-pattern”). “Anti-strategists” consider OSS as one of the
tools at their disposal to fight the market, but not as an inherent
attribute/value of the company. “Anti-strategists” are usually smart enough to
benefit from the side effects of their actions and properly monetize it, but
this is not what originally led them.
Anti-strategies are dangerous as they can backfire. IBM (and its Linux vs.
Microsoft story) is a famous member of that category.
The fifth category, the “head-less chickens” (*1), are usually
ex-”in-denial” companies (see category 6 below) under pressure of Open Source
and paying the price of their denial. A specific attribute of such companies is
that they can come come-up in a very short timeframe with any of the 4 first
positioning described above, in random order, as a way to satisfy their
Board/investors/customers. Typical scenarios include Open Sourcing uninteresting
part of their codebase that nobody will want to pay money for anyway, providing
their software as an Open Source version for the children and a for-pay
version for the adults (no credibility), joining/creating random OSS projects
just to fill in the strategy gap, etc. Their real underlying strategy is to
undermine as less revenues as possible while waiving hands as much as possible.
Unlike chickens, companies can recover if well managed (sewing a different head
can be a good start of the recovery process).
The sixth category, the “in-denial”, prefer not to see Open Source and
will make sure to mention its existence as less as possible. When you speak
about OSS to such a company representative, (s)he will usually stare at a
virtual spot on the ceiling and start whistling a well-known song. Like for the
second category (“mixed-codebase”), I also see this category as a transition stage.
Abuse of that stage usually leads to stage five (“head-less chicken”).
The seventh and last category, the “anti-OSS”, like the first category
(“the truly committed”), benefits from an extremely clear positioning: they hate
Open Source. Given the popularity of Open Source on the market, very few companies
risk that positioning as it might backfire. Microsoft is a well known member of
that category. I have to admit I admire their commitment to this unpopular
strategy. To succeed in it, it is essential to keep a clear and
active communication on the evil Open Source. In that regard, I have been
disappointed recently when Microsoft mentioned they “provide lots of Open Source
code” referring to MSDN code snippets (Ashim Pal, Gartner Panel, Barcelona,
2005) as well as when they backed
WiX. By not being clear-cut and vocal, “anti-OSS” companies take the risk to
become passive “in-denial” companies with the song of the hatchet not far
I think only strategies 1, 2, 3 and 7 can be stable positions (with strategy
2 offering a good runway), while the others are unstable.
What is the strategy of your main software vendors?
1) Have you ever seen what happens when you cut the head of a chicken? The
headless body start running left and right until it collapses.