|
INDUSTRY WATCH: Community VS. Company
By David Rubinstein
 March 15, 2004 — Marc Fleury, the CEO of the newly incorporated JBoss Inc., is fed up.
“I’m tired of people thinking open source is free, peace and love, yadda yadda. We have a strong profit motive.”
Yet many people creating open-source software do not have any kind of profit motive, and therein lies the root of Fleury’s exasperation. Open-source software can be obtained for free, from a wide number of communities that exist just for that purpose. The whole thing gets messy only when companies come in, put a pretty package on it and announce it’s now for sale—or when people poach or otherwise unwittingly obtain code from open-source projects to build into proprietary software, but that’s a whole other column for another time.
Fleury thinks he knows better. So does Novell CEO Jack Messman and others who are looking to create what Fleury calls “second-generation” open-source software companies. These executives understand that you can price software at a million dollars or give it away for nothing, but if the corporate infrastructure is not in place to support customers, there won’t be any customers.
“We call it professional open source,” Fleury explained in an exclusive interview with SD Times. “I know it sounds vacuous. There’s an open-source component, but it’s about licenses, and communities built around codebases.” Fleury said Linus Torvalds once said that Linux is really 10 people. “They’re all professionals, getting paid by IBM and Red Hat and OSDL. Then, a large community does QA and extends it.”
What Novell and Red Hat do, and what JBoss will have to grow to do, is prove it can handle supporting large enterprise customers around the globe, at all hours of the day and night.
But there’s an old saying that goes something like “Money talks, and cow chips walk.” So to fight this fight, JBoss Inc. has a new US$10 million in venture funding. “We’ve always been profitable and cash-flow positive,” Fleury said. “So people say, ‘Why did you need more money?’ It’s strategic.”
Sure, JBoss needed the money to step up its marketing efforts. It needed the money to entice people to work on JBoss’ open-source projects, with the dangled carrot of employment and—dare I say it?—stock in the company! But most important, JBoss needed a pile of cash in its corporate coffers to send a clear signal of viability to the market. “Knowing that we are financially viable mitigates their risk,” Fleury said of potential customers.
Apparently, there’s little risk in the JBoss technology. Its popularity among Java users is on the rise, with 26.9 percent of people responding to a 2003 survey by this newspaper’s sister organization, BZ Research, saying they have adopted the app server. Fleury said this made securing the funding all the more easy.
The lead investor in the round was Matrix Ventures, where David Skok, founder of the former SilverStream Software, now hangs his hat. “The one [venture capital firm] that knew the most about the field felt the strongest about the deal,” Fleury boasted.
Open source was the hottest of hot investment opportunities in the late 1990s, when companies were able to secure millions in funding. Who could forget the initial stock offering of VA Linux Systems Inc., which gained 697 percent on the first day its stock traded—opening at US$30 per share and closing at $239.50. And Fleury thinks that based on his company’s venture round, in which he said eight companies were vying to invest, open source will become a hot investment once again.
But just how open source is open source, when a company controls its code and locks it down? Is JBoss turning its back on the open-source community when it claims it will own 80 percent of its code and will swallow up the developers contributing the most serious work to JBoss projects?
“That’s the basis of second-generation open-source companies,” Fleury said. “MySQL owns 100 percent of the intellectual property. We own 80 percent. We control the quality of that code. It’s not ponytail open source. It’s a more mature, refined business model.”
The line between open-source and proprietary software is being blurred by these “next-generation” open-source companies. They claim to be redefining what open source means, but instead they are moving further away from the spirit of the open-source community, which was to create software that could be shared, improved and given back to all—without any fees or restrictions at all. No code lock-downs. No maintenance charges. No ownership. No profit.
To me, if a company owns its code, controls changes to it, and employs the engineers working on the codebase, it’s a company, not a community.
David Rubinstein is editor of SD Times. |
|
Advertisement
Click here for a complete listing of Industry Watch Columns
Click here to see a complete Column Archive. |
Back to Top
|