Open Source

The Open source business model suffers from a form of trickle-down economics. (Do you like this cartoon by Ross Kettle? Send him some PayPal love.)

Enterprises can see the value. They get rid of monopoly rents to Oracle or Microsoft. By seeing the source code they avoid its becoming obsolete. They can set internal programmers, external vendors, and outsourcers against one another to keep costs down.

As a result money is flowing out of the tech economy, and innovation is slowly. The money is going to the enterprises' bottom line. It is not being re-invested. Media that covers the enterprise space is suffering along with the industry.

In the mass market it's a different story. It is possible to build a credible office PC out of Linux, Open Office and Firefox, but only if you're a sophisticated user. You lose access to content on proprietary platforms, you may have (or fear you may have) trouble communicating with business partners. It's a big risk.

That's why Microsoft can hobble new Vista PCs. Customers don't have a choice but to obey its technology dictates. Desktop Linux has yet to get into the middle of demand's "s" curve, and win mass-market acceptance. Until it does Microsoft need not respond to complaints.

If the open source business model does not meet this challenge, it will lose support from the mass user community. Lose that and all its other gains are at risk as well.

Groundwork is at Interop this week, using its open source monitoring solution on the InteropNet.

The East Coast show is much smaller than those on the West Coast, but that’s fine with  Tony Barbagallo, vice president for product marketing and management at Groundwork, because he’s targeting mid-sized businesses anyway. (See the whole company’s current presentation slides via the Web here.)

"We figure we’ll meet the needs of 80% of the base market. The other 20% need OpenView and Tivoli. For the rest of the market which can’t afford that price anyway we can meet their needs."

Groundwork is starting to look up-market, toward companies which have a network administrator separate from the system administrator.  The company is offering a "professional systems engagement" with prices starting at about $25,000, where it will install and test software in network devices, integrating them with its solution.

That solution includes well-known open source tools like NeDi, ntop and Cacti, integrated with Groundwork’s own Foundation and Guava software, with results displayed graphically. Even at a base subscription price of $16,000 and the professional services, Barbagallo charges a fraction of what commercial offerings do.

Recently, Barbagallo said, Royal Bank of Canada budgeted $1.4 million for a network monitoring solution, which Groundwork delivered for $180,000. Even in Canadian dollars, those are real savings. Downright loonie.

What would be loony would be to not take those savings seriously.

When it comes to enterprise software, it’s always that first customer which is the toughest. Prove your claims once, and the world may beat a path to your door.

Open source can play that game, too.

The subject here is Medsphere. I’ve written about them before. Their OpenVista technology was originally developed at the VA. It’s not only open source, it’s public domain. Building a business on that would take a key customer.

That turned out to be the Midland Memorial Hospital, in West Texas. Medsphere vice president-sales and marketing Frank Pecaitis says they’re a good mid-sized hospital, about 400 beds, and they had evaluated a number of proprietary offerings before going with Medsphere early in 2005.

Now they’re up. "The satisfaction is high, and they keep using additional features," he reports. An Electronic Patient Record, which is at the center of the OpenVista system, touches everyone in the hospital. "There’s over 30 individual software applications that use our electronic health record. They don’t do a big bang – they start small and extend."

But in a way, an Electronic Patient Record is a Big Bang. With EPR technology in place, every department in a hospital suddenly has access to accurate patient records, and in time so do pharmacies and physicians serving that hospital. Money is saved, accuracy is assured, and (yes) lives are saved as well.

With Midland now happy, Pecaitis can also show Midland to other prospects. He figures there are potential contracts worth hundreds of millions of dollars in his sales pipeline now. Part of their due diligence will be trooping out to West Texas. "We don’t have corporate jets like the larger vendors. Our clients fly in on their own dime." Fortunately Southwest Airlines has served Midland for a generation.

Pecaitis says that among his prospects is a hospital in New Orleans. A flood may be about to begin.  This time a good one.

UPDATE: The man originally pictured here, Andrew Updegrove, writes in his blog that he is and was a supporter of the ODF standard, that the article noted here was not meant to oppose it and was not written for the Commission. He is currently vacationing, however, and I hope to interview him soon. Meanwhile, I’ve taken his picture out and made minor changes to the text, reflecting his views.

The original Computerworld story on this can be found here.   

I’m sure this is just a hiccup, but apparently the blind have given Massachusetts’ efforts to mandate open source the shaft.

Because Open Document Format (ODF) software (Open Office) does not yet work with screen magnifiers, which make computer documents usable by those who are legally blind, the state of Massachusetts is backing-away from its commitment to mandate the format.

The Disability Policy Commission had been among those objecting to the mandate, and they were thrilled by the decision. For now the mandate is being put-off for at least a year. Windows has a magnifier built-in to XP, and Dolphin’s Lunar only says it works with "Windows applications." Peter Korn of Sun wrote a long post last November which speaks to all this on ODF’s behalf.

Korn blamed the vendors for the problem:

If Freedom Scientific and GW Micro and Dolphin Computer Access (makers of JAWS, Window Eyes, and SuperNova respectively) were to make similar investments in scripting and customizing their assistive technologies for OpenOffice.org as they have for Microsoft Office, or if they were to improve their existing scripting and customizations for WordPerfect and Wordperfect were to support ODF, then screen reader users should have no accessibility barriers to equal productivity and efficiency with ODF as they have with Microsoft Office in Windows.

"Credit" for this goes to attorney Andrew Updegrove (above), who wrote a paper for the Commission last year challenging the state’s action. He has not yet commented because, according to his blog, he’s hiking in northern Arizona. If you see him there ask him about it.

Personally I think that ODF support from disability software makes sense. But when that market is controlled by proprietary vendors who won’t do the work, what is the open source movement to do?

I’m going to write about this at length next week, but for now, as the press bids farewell to LinuxWorld in San Francisco, something needs to be said.

Linux and open source should not be confused with one another. Linux is open source, but so is much else.

Instead, Linux is the tip of a spear aimed, mainly, at what used to be called the "big iron" market. You could see that on the show floor, dominated as it was by booths from IBM, Oracle, AMD and Motorola.

The open source spear, in turn, is aimed not at Microsoft but at margins generally. Open source thrives wherever margins are vulnerable. It cuts margins away, in great chunks. It commoditizes anything which has, in fact, become a commodity. It forces resources toward creating something new.

This last is important, but it’s often obscured. So many open source projects are based on replicating the past, on rebuilding something that has already been built by others, that critics are bound to call it somehow dishonest.

What Linux has done, within this larger movement, is to make Unix what it was meant to be, the default OS for "big iron," which we now call servers. Like Tolkien’s ring, it found all the other Unixes, and bound them together, by doing what every Unix vendor feared doing on their own, compressing margins to the bone.

The point today is that the real challenge for Linux is just now coming over the horizon, that is, the creation of something new, and profitable.

There were hints of that this week. Single-stack databases. Server racks that run multiple operating systems.

For next year, more like this, please. 

It sounded at first like something out of Scientology.

But I was wrong. It was just open source training. Although the process it launches can lead to corporate enlightenment.

Open Logic is selling seminars to corporations which want to let open source into their workplaces, but feel they need procedures and policies first.

CEO Steven L. Grandchamp called it  "a two part workshop with a workbook. It’s a couple of days of training, helping people go through all the things they need to know, and either coming up with answers, giving them answers, or extracting the answers from existing policies."

In addition to bringing this directlly into client offices, OpenLogic also has attorney Jason Haislmaier offering some of this as a Webinar.  It’s all part of a process where, instead of confronting companies on open source, OpenLogic leads them by the hand toward the light.

"Here are projects and here are licenses. And here are support entities. You get more uptake and then you find a need to tweak it. The framework can’t be a set of handcuffs. It’s a guideline." Spoken like a sage.

But Grandchamp also knows that in the end this is going to change more than corporate software policies. (That’s the cover of a book on the Scottish Enlightenment at left.)

"What this does is create a framework for allowing some of these other change ideas to catch fire." Once you have an open source software process, in which people are empowered to create better tools, it’s just a short step toward an open source business process, in which corporate power flows from the bottom-up.

"There is some fear in it," Grandchamp admits, so the idea is to lead corporations away from the fear and toward the light. Slowly.

I happen to think this is important work. Kvetching alone won’t bring corporate America around. And best of all, when OpenLogic does this, it’s profitable.  (So is Scientology, I hear. But that’s another story.)

Do you run PeopleSoft or Seibel CRM software?

If so, you may feel you’re in a bear trap. (Modern bear traps look like the one at right.) Your supplier has been bought, for your contract. You fear rising costs. You want to get out from under.

Queplix says it has an answer, one with the words "open source" all over it. But how open source is it? I asked Paul Tenberg, a director of business development at the company, and the answer is still unclear.

"There is a commercial open source for enterprises where there are additional modules, compatible with enterprise level servers like Oracle. It will be a proprietary license."

Essentially, Queplix has some simple CRM software, free, available for download. There is also a "professional" version, with tools that let you pull your business objects out of your present installation, and from that re-create your old interfaces and business rules under J2EE. These tools are proprietary.

But what Queplix is really selling is a methodology, one in which their people help take you off a platform you feel may be dieing and give you back control of it.

Even after you go through this process, of course, you may still be in a trap if your database is proprietary, as it often is. Queplix solutions speak only to getting your CRM application out of the bear trap, not the underlying database.

And if you’re thinking about this just from reading ZDNet, you may not be in Tenberg’s target market anyway.  "For legacy converson we’re looking at high end and Fortune 500 enterprises. These things we’re converting are bought by big players. We can technically convert any legacy system, but it makes more sense for bigger players."

Little bears are still on their own. If you’re a little bear, let me know and we’ll see what we can do.

I had a very nice chat late yesterday with  Josh Berkus, who works as the Sun lead with PostgreSQL.

After watching Sun suffer from "margin compression" for years, while transforming itself into an open source company, he’s now watching database rivals Oracle and Sybase suffer the same fate.

Not that he’s taking all the credit.

"This would happen without open source, but open source is just making it happen a lot faster," he said. "IBM DB2 and Microsoft’s SQL Server have had just as big an effect, maybe bigger, than anything we’ve done."

For a long time Oracle could claim that there were no open source alternatives for enterprise database applications, but that is no longer the case, Berkus said. "While there are some things Oracle does better, there are a few that we do better. GIS, for instance – we have a better GIS package. And it varies across databases. When a user needs a feature people will choose based on it.

One area where PostgreSQL has been doing really well is in biological research. "Biological resarchers have created their own data types to handle genes and molecule pairs and gene sequences."

The competition will continue, and that’s good for everyone. "I won’t say we’ve caught Oracle yet but our development is now much faster than Oracle’s," Berkus concluded. "It may be faster than any other popular database system period."

I happen to be a loyal alumnus of Rice University, class of ‘77.

So it was with more than a little pride that I opened up my News.Com folder today and saw the following: Rice Swaps Print for Digital Press.

The University is reviving its old academic imprint through an open source Connexxions system. This also means Rice materials will go under the Creative Commons license.

Now, in some ways this is not terribly courageous. The Rice University Press went under 10 years ago. It just cost too much money.

But in some ways there is real courage here. A major American university is putting its prestige, and a piece of its academic reputation, behind open source content, not just software.

As the old campus joke goes, I think this makes them a credit to their Rice. And if the new football coach is as good as his reputation, we’ll finally see what one-third of the planet most wants to see. Rice in a bowl.

SourceLabs’ Continuous Support System announcement is leveraging the entire open source community to help big outfits deal with support issues. (Image from the OpenGroup, advertising a competition for Voice Profile for Internet Mail software.)

CEO Byron Sebastian and co-founder Cornelius Willis told me it’s an Early Warning Radar that will bring all open source users the kind of diagnostics, security alerts, and vulnerability notifications they need to be truly comfortable with open source on an enterprise level.

"We generate, every day, an RSS feed or e-mail of over 1,000 new data points" Sebastian explained.  "This goes to our enterprise customers, summarizing all the secuirty issues identified that day with open source projects.

"Most of the time there are none, but if you’re a large corporation just knowing someone is looking gives you peace of mind.

"If there are issues we tell you what API not to use, or what configuration to use to avoid it, or we say we’re sending a patch in how many hours. This leverages all data that’s out there in the community, then provides valuable servies to large companies so they have more confidence in open source."

The system has been two years in the making, added Willis.

"We’ve been using this with customers for a year and a half. Our open source customers have started ‘bake-offs,’ where they have us compete with other firms on support cases. We win those bake-offs because we have the technology needed to solve the problem. It’s not just our engineers, but our technology, that wins.

"Think of an air traffic controller in the 1930s, using a binocular and telephone. That’s what it’s been in support. Now you have radar and telemetry so they can do a dramatically better job."

Anything which makes enterprises more comfortable with open source is something even small companies benefit from. The contributions of the big improve the systems of the small, and give everyone a bigger, wider platform tobuild on.

CollabNet CEO Bill Portelli started our interview today bragging about CollabNet Subversion, his open source Web-based versioning system.

But we ended up talking about something much bigger, how open source is changing the way businesses of all types operate.

For CollabNet, open source was "a practical business strategy that worked." Five years ago he needed some versioning tool beyond CVS in order to make headway in the managed services business, and found only proprietary offerings from big outfits like Microsoft and IBM. To compete, he said, the only option was "to build a community and leverage it."

So yes, it was selfish. "We used open source to create a standard in the market, so we could provide other products and services on top of it, all based on open source."

But what CollabNet found in developing Subversion, other companies have learned in using it. "We can help you develop products for 20-50% less by building a community, and by using the right web-based tools. A client came back and said the model created unplanned innovation, with half-billion dollar product lines created," from the bottom-up, rather than through departmental silos.

This is a profound change. And Portillo is remarkably eloquent in describing it:

In any change there are going to be people affected. The important thing is to understand what’s going on and get ahead of the curve. That’s true in any technology transition. We need to get ahead of it.

I can see individuals losing jobs. But if you look at the rate of innovation in open source, and the jobs they’re creating, all these things are dynamics that are healthy for the business and create innovation higher up the stack. Look where open source is happening and look how to leverage it.

Open source doesn’t solve everything. Open source is disruptive in many ways. We argue internally about how much to share, what to share. But the Internet has shown it’s no longer good enough to be stuck in your own silo. You have to become part of a community and be ready to leverage it.

Don’t think of open source as just a software business model, in other words. Think of it as a new way to do business, a new way to leverage all your relationships. Think of it as business evolution in action.

The major challenge for Hyperic over the next months will be turning the enterprise users of its management software into an open source community.

That is the view of Bob Bickel, who recently joined the company as a "key strategic advisor" after having spent several years at JBOSS, most recently as Executive Vice President of Strategy and Corporate Development.

Actually, Bickel told me, the Hyperic gig is part of his plan to eventually become a high school math teacher. Bickel, who will see my side of 50 next year (I like to call it the fun side), said he told JBOSS CEO Marc Fleury of his intention last August, long before JBOSS thought of being acquired by RedHat.

Bickel hopes to apply lessons learned at JBOSS to Hyperic, which recently went open source under the GPL. "Hyperic needs to bring their great technology out and build an open source community. JBOSS already had a community. We need to build one here."

Given the need to build that community among enterprises, Hyperic is tweaking the GPL slightly, adding a codicil to its own contracts "so no one needs to fear that an agent makes their own software open source."

Bickel said that Hyperic is great for the "middle market" of companies that are too small to afford an enterprise management system like Tivoli and too big for simple scripting system. "We’re trying to make sure we bring a lot of functionality – full monitoring capabilities, a full agent architecture and 40 agent plugins, as well as the server functionality," to the open source world, he said.

But this will be a different type of community, a community of companies. "An ISV could use all this, incorporate it and reference it in their product set, and Hyperic supports all kinds of network devices, middleware, databases and applications."

My post yesterday on Microsoft stirred up quite a hornet’s nest.

Not just here, either.

Michael Francisco of Microsoft’s Port 25 project  was kind enough to send a personal e-mail. "Be assured, we are not abandoning the Open Source conversation.  Quite the contrary; through Port 25, we are working to create a community wherein constructive communication can take place," he wrote. (Want to go there? OK.)

This is one step down the open source road, but for all proprietary vendors it’s a journey of 1,000 miles. Throwing out some code under a restrictive license and looking for "constructive communication"  are fine, but they are baby steps.

Engaging fully with the community, rather than just through your own site where you will get "constructive" communication, is another step. These are steps I noted Microsoft has retreated from lately.

Alex Barnett (above), Big Green’s Community Project Manager, made his differences more public, posting them on his blog and linking to my original post. He also links here to many open source projects Microsoft has going (his post is filled with such bloggy goodness) and adds what I consider an appropriate level of snark. (My j-school degree is 28 years old this month, by the way.) 

All these projects are under Microsoft’s "shared source" license, one of the most restrictive in the open source world. Barnett also notes that contributions to its CodePlex are being accepted under many licenses, including the GPL.

Fine enough. But how far is Microsoft going, really? How much is it giving, not just in terms of code but in terms of license terms, against what it’s expecting to get from the community?

I’ll leave that for the ZDNet community to answer. My own view remains that if you want to get, first give. And that for those to whom much is given, much is expected.

One of my favorite stories from the Iran-Contra scandal 20 years ago was how Oliver North thought he was deleting documents by hitting "delete." 

He wasn’t, of course. He was just getting rid of pointers.

Flash forward 20 years, and open source can now find needles in much larger haystacks. Kazeon and Google are teaming up to offer an $80,000 solution that will let enterprises search 20 terabyte stores of unstructured files at once, including archives and backups. The complete press release came out today on the Kazeon Web site.

Vice president  Troy Toman touts this as an essential tool for enterprises in our litigious society. He sees thousands of potential customers. "With the increasing nunmber of regulations on compliance, and the increasing litigious nature of business, people have a need to know where their data is."

This does not mean the NSA’s attempt to grab everyone’s data makes sense. The Kazeon solution only works if you know what needle you’re looking for in a haystack.

"Those technologies are still only really effective in well-defined domains and small databases. It will be a while yet before the true analytics you need is available for these larger databases," Toman explained.

From a business sense there are several interesting aspects to this:

• It’s a "mixed source" solution, one that still results in a definite price tag.
• Google should now be seen as being very serious about the enterprise space.
• Google’s willingness to partner with a virtual start-up in Kazeon is also significant.

Toman also broke down for me how the costs stack up. Google’s search appliance starts at $30,000. Kazeon’s IS1200 then costs $40,000, and there’s about $10,000 to tie everything together. That $80,000 is a starting point.

Kazeon CEO Sudhakar Muddu also explained how all this will go to market. "Google has a good enterprise sales force. We’re doing a lot of sales calls with Google.

"Google is not looking at this as an open source," he added. "It’s a question of solving the problems of legal compliiance. How do you extend a search to billions of files. Google’s interface means you don’t have to learn our product, you can go deep into archives and backups."

Got that, Ollie?

Ever since my daughter Robin was born, I’ve been covering education technology.

It has been a history of failure.

Back when Windows was rendering everything obsolete every three years, technology coordinators in education were dead men (or women) walking. As soon as they got systems ready for training teachers, the systems were obsolete.

This is no longer the case. Computers are cheap. Since their primary use is to access the Internet, they remain useful for years. But only if these assets are managed. And solutions like Tivoli, are not cost-effective in the K-12 market.

So schools’ technology coordinators are still dead men (and women) walking. Especially when they tell the bosses that the hardware and software they’re buying is just 15% of the money they need to spend.

Solutions are finally coming from the world of open source. From Open Country, CEO Michael Grove told me. "We do system discovery and systems management. We can do remote monitoring, asset discovery, diagnostics, repository management, provisioning, deployment, security updates and scheduling."

With Open Country in the hands of a vertical market vendor, school networks can be managed remotely for the first time, for a reasonable fee. School computer budgeting becomes predictable.

Grove has been working with Intel to deliver these kinds of cost-effective solutions to India under Linux. "We can sign channel partners to roll trucks. Now you can just press a button on our graphical user interface and reprovision without having to know anything. In the background our management system is doing the lifting."

Great. When will it be available here? "We’ve found a group who is working with lots of school districts and is putting together solutions. We’ll have Windows by year-end."

Robin graduated high school last month.

Could there be less to RedHat’s strategy than meets the eye? Might it all be, well, zen? (Or Xen?).

That’s the impression I gathered talking to vice president-enterprise solutions Tim Yeaton yesterday.

The onetime Compaq executive, who joined RedHat last year, said the JBoss deal was based on cultural consistency, that the Mugshot project was about insiders following their bliss, and that everything RedHat does is based on the desires of enterprise users.

For that reason, Yeaton is not worried too much about issues like license harmonization, preferring to be just as open as RedHat sees its enterprise customers wanting it to be. "We have the most open license for each technology. There are some things we build in that may be under other licenses, and it’s not our place to choose how open source projects license."

As to where RedHat is going to be physically (JBoss is based in Atlanta, RedHat itself in Raleigh) the answer was, wherever you want to be. Yeaton himself is based in Massachusetts, where many of the company’s top developers (including the folks behind Mugshot) prefer to live. "We have a lot of engineers working out of their houses." (They also just opened offices in Brazil and Argentina.)

Yeaton is personally working hardest for enterprise customer loyalty, focusing on things like certification and virtualization (that’s where the Xen comes in), with top-line growth being more important than margins. This is the way it is in fast-growing markets, which open source certainly is.

"All our projects are at the stage where they are ready to build community," he added, so expect to see more moves in that direction soon.

Is this the way a company should be? Or is this the way an open source company has to be?

One great achievement of the term "open source" is to create a licensing continuum. (Eric Raymond, left, author of "The Cathedral and the Bazaar."

The GPL is a great idea, but it is the deep end of the pool. The idea of total freedom, and the responsibility to give-back in maintaining that freedom, is an awful big step for corporations to take, steeped as most are in the idea of "intellectual property."

Open source lets companies go just as far down this road as they wish. They can call it "blended source," or "mixed source," they can support a wide variety of BSD licenses, they are free to experiment, to set their own strategies.

What most discover, over time, is that they get only as much as they give. Blended source companies get less from their communities than BSD companies, which in turn get less help than those using the GPL.

Ad big companies seek to reduce their expenses for maintaining and growing software, they step out futher along the continuum. This is often done through donating code, or supporting projects, rather than through changing license terms. As they see contributions come back to them they become increasingly generous.

Getting to the GPL, in other words, is a long journey. But thanks to the term open source, there are now 1,000 steps along the way. And without it, most firms would not take that first step.

Jitterbit, which makes software tieing applications together, is going open source under the Mozilla public license, slightly modified to protect the trademark.

Two versions are being offered, a free community edition and a $9,995/server/year (for support) professional edition.

I asked CEO Sharam Sasson why he didn’t just go GPL. "The driving force is we hear the community and companies who want to go open source have issues with the GPL. They don’t like the viral aspect. They believe they should own their enhancements. With this license they are protected.

"To us it would not matter. Just to be more sensitive to our customers."