It all started with Dana posting news about CentricCRM getting Intel venture financing. CentricCRM  looks and talks like open source but their license is anything but open source. Confusion is a good business model and if the objective is to achieve 2% of a huge market then its working for lot of companies. Markets work at multiple levels. United Airlines and Jetblue both are making money. They just fly different corridors and come with different frills. Same model in open source CRM - just fly with different open source license and fly with different architecture. Nothing wrong in this as long CONFUSION market still exists.

This emerging confusion around the term “open source” has Michael Tiemann all riled up. As the lead proponent of OSI he has valid reasons to voice anger. :

It is logical precisely because there really is not room in the market for Yet Another Proprietary CRM system. It is fallacious because THESE LICENSES ARE NOT OPEN SOURCE LICENSES. This flagrant abuse of labeling is not unlike sweetening a mild abrasive with ethylene glycol and calling the substance Toothpaste. If the market is clamouring for open source CRM solutions, why are some companies delivering open source in name only and not in substance? I think the answer is simple: they think they can get away with it. As President of the OSI, I’ve been remiss in thinking that gentle but firm explanations would cause them to change their behavior. I have also not chased down and attempted to correct every reporter who propagates these misstatements (the way that Richard Stallman does when people confuse free software with free beer, or worse–to him–open source). I have now come to realize that if we don’t call them out, then they will get away with it (at least until customers realize they’ve been fooled again, and then they’ll blame both proprietary and open source vendors alike; they probably won’t be particularly charitable with the press or careless industry analysts, either). If we don’t respond to those in the press who fall (or are pushed) into these logical traps, we are betraying the community.

Unfortunately OSI made a pretty big blunder early on by not trademarking the term “open source” and to correct that will be a huge undertaking. “Marketplace of ideas” solution Michael talked about is slow and confusing. What we need is a strong push back from software buyers.

Otherwise we will very soon see AppExchange kind of listings on RedHat exchange and we will wonder what happened to all the big ideals of open source.  I am not saying there is anything wrong with this approach but just don’t put strong font  to your “open source” claims.

If you are open source give community the code and get out of the way. We are doing precisely the same with our open source project and will keep it that way.

Technorati Tags: open source, centriccrm, OSI

Timing and news coverage is bit fishy here.

Redhat launched RedHat exchange and further solidified their perceived leadership role in open source. Fud like the one Microsoft is raising can send mixed signal to companies hoping to join RedHat exchange. Who knows what might happen and who is trolling for what.

Second interesting aspect is about Fortune breaking this news. Fortune had been critical of open and free software in the past. Mostly by taking a stand that OSS/FOSS movement is anti-business.

Last point is more interesting and that concerns Google. Depending on how scared Microsoft is about Google and knowing Google runs all their data center servers on Linux this can have potentially interesting dimensions. Again this is all theory but lawyers tend to think very differently from engineers so we shouldn’t be surprised about the broad direction of fud, whereas Microsoft’s intended target could be very specific.

Blogosphere will wake up on Monday with full of anti-Microsoft posts. Diggers and Slashdotters will have field day with this.

Redhat is by far the only big pure-play open source success story out there. They have perfected their subscription based revenue model and now it seems they are intent on putting more and more components to add incremental revenue. Complete SOA stack strategy is designed to shift enterprise budget from licensing model to the subscription model.

They are marching up the stack. This became clear when they announced the acquisition of MetaMatrix, a proprietary integration framework which acts as a data glue between business applications and different data sources. Sort of like Tibco for data. MetaMatrix competes with big companies as well as innovative startups such as Composite Software.

This acquisition has a potential to cause lot of disruption among existing integration players. People have already started talking about “shorting” Tibco and BEAs of this world. Ashlee Vance recently reported about seismic changes taking place in the mid-market enterprise software segment. Ray Lane of Oracle fame making  a chilling prediction of carnage coming in the mid-market. Companies will loose lot of their pricing power when caught between three giant forces changing the economics of software industry - consolidation at the very top, move towards software as a service and popularity of open source model.

Redhat is ideally positioned to scale out their subscription model with more and more interesting components in the mix. They will make more acquisitions to expand vertically.

[Cross posted on OpenAppDotOrg]

Maybe Google economy principles have finally hit the enterprise software ecosystem and are now demanding better price-tag on the end-user attention. What’s the best way to remind people  about the attention tax - put a nice 100px by 25px logo at the bottom of every UI code and enforce click-for-action by making a mandatory link on the logo which will take user to the accepted monetization avenue. Which by the way will always be  a community forum. [ If for some reason that software gets bought out by your competitor then you will be engaged in the noble business of diverting your customer to your competitor ]

There is nothing wrong in all this. Commercial open source vendors  like SugarCRM, SocialText and few others are demanding attribution clause in MPL to be made OSI-approved. They are fully justified in making this request and to a certain extent I support the generic attribution clause proposal. After all  developing software code requires real engineering hours and it does cost money. Though this request makes sense based on the known data points but future can be very very slippery.

If unchecked attribution clause can very well kill the growth of open source applications.  Logo attribution is a  GPL for front -end.  Imagine if all components which go into SugarCRM claim this clause then every UI screen of Sugar will look like a Nascar race car - decked in every possible logo. SugarCRM will hesitate to use Smarty template if Smarty came with the same clause. This logo-burden will kill the effective integration choices and will limit the growth of open source applications. What if all ajax libraries start including this clause? Web2.0 will be dead right there. Remember there is no definitive distinction between “application” and “application component” and that’s why its going to be very slippery.

This debate is not going away soon. This time there is a widspread belief that any defensive software business model has to have an open source strategy. Venture community has jumped into this as well. So there is a clear exit expectation build around “commercial open source”. Redhat has proven the merit of support subscription revenue. To guarantee that subscription revenue, there is an attempt to permanently engage users via attribution logo. That’s where exhibit B comes. This in-your face strategy is a necessity for meeting high revenue expectations.

I don’t see much upside in this debate. Application vendors take their messaging inspiration from the school of Larry Ellison and Marc Benioff. Meaning most of the time it’s a contact sport. In this context the world of OSI comes out as a different culture altogether.

Which is why we will see conflict and eventually a fork in the open source philosphy.  OSI with it’s geeky and  algorithmic conversational style will collide right on with this blog-powered VC-backed attribution-clause loving coterie. Open source in this debate is just an orphan meme getting tossed around to gain few attention points.

More on this topic:

- Generic attribution clause proposal by wiki software vendor
- Nicholas Goodman’s funny but possible future scenario
- Debate on OSI-license mailing list
- David Berlind’s wonderful summary which provoked further debate

They are probably right in claiming that they have contributed more to open source than all the big players they compete against.

If only they can fix the problem of showing up when it really matters. They were day late with XML, day late with Solaris and now may be few quarters late with Java.

Though metaphor used by Jonathan got me thinking as to what will happen when open source tide settles down as a regular mainstream phenomena?

Rumor machine is working well at this point. They will be announcing this at LinuxWorld.

Experts will be weighing in on this for months. Apart from the obvious impact on Redhat’s business practices (not just revenues - as they have been pissing off customers like anything) it will also reflect sharply on Sun and Novell’s business.

Who knows we might live long enough to see SAP port on Oracle Linux distro !

Lot of folks are blogging and there are plenty of pictures on Flickr.

Conferences in general means getting ready to know new players and  interesting projects. Panelists are usual suspects so there is more of the same. Technical threads give better value in terms of knowing who is cooking what.

 Neal Ford’s presentation looks insightful. We are working on our own DSL framework so it will help to get design benchmarking (OpenAppDotOrg project). Thanks to O Reilly folks all the session presentations are available on the site.

Best part of this OSCON seems to be the coming out announcement by DIMDIM and Coupa.  These two apps demonstrate the unstoppable march of open source as a business model in enterprise business application category. Coupa using Rails and Dimdim support for Moodle is a big plus as well. I will be cheering for these apps that’s for sure. Watching Coupa is going to be fun as it’s adoption will be preceded by the adoption of Rails framework.