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Saturday, July 09, 2005

Marc Fleury On The Myth of Open-Source

(Via Businessweek) Marc Fleury, Founder of Jboss, is skeptical of the new generation of open-source startups now being funded by VCs. He sees some momentum in the opensource adoption. He points out to a funny [ramp] to adoption in open-source where you have a very high barrier. The perception to open-source [used to be that] it's dirty - nice IT managers don't do that. But once the developers started playing with it, [there] was definitely a bottom-up movement. What's going on now is the reverse. It's a top-down movement. It's really the [top executives] now that are saying, “We’ve tried this open-source thing in production, and it works. The support is supposedly there. Let's make this the corporate standard." Today Jboss powers the reservation engine for Travelocity, monitor the power grid at California ISO [a nonprofit organization that regulates the flow of electricity in California] – clearly mission-critical environments. Jboss makes money when the large [corporate customers] want to standardize and they need a relationship with a vendor.

Today's opensource business model simply says: We're software vendors. We write the software and offer the service. And I know my business model will fail for other parts of software, so don't try this at home. You may get badly burned. No one is going to work for free. That's the myth of open-source. [New open-source startups are] trying to buy distribution. And maybe they'll succeed, because if you give something away for free, people will come. That's the only part of the model they're replicating: Give it for free and charge for the service. The point is, do you have enough volume? If that's your model, you monetize 1% to 2% of the user base, ergo you need a pretty large user base to have scalability. It is a myth that a startup will get developers to hone the product for free. No One works for free. Across all of software, not just open-source, you have a pyramid of productivity. It's an art still - a black art of creating great software. At top of the pyramid, you have these top 2% of developers that are 10 times - in some cases 100 times - more productive than the rest. It's true in proprietary developments like Microsoft and true of open-source too. The value is the QA [quality-assurance testing to make sure the software works and finding and fixing bugs]. They cover more ground than we could ever test. If you get free, you want a lot of it. If you give free, you're going to give until you're tired of giving, and that's exactly what happens in the open-source community.

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"All views expressed are my personal views are not related in any way to my employer"