Once More unto the Breach

Open Standards, IPR and Innovation Conference, Beijing 2006

The China National Institute of Standardization and Sun Microsystems co-hosted a one day conference on "Open Standards, IPR and Innovation" in Beijing.  I was an invited speaker.  The event's goal was to bring together a set of speakers that would provide different perspectives and practices on how standards and intellectual property rules play together inside and out of China, such that China can determine what will best work for them. 

There is obviously a reasonable amount of tension between a handful of countries and China when it comes to claims of piracy, and as China's economy continues to grow, that tension has broken out in the standards arena as well with competing standards for such things as RFID technology and WiFi complicating the discussion.

The great thing about the conference was that one felt the Chinese speakers and attendees were definitely attending to learn, but it was NOT to learn how to be more "western", but rather to learn so as not to make the same mistakes.  The growing sophistication of business and business practices is palpable in Beijing in general, and definitely present at the conference.

One thing that was also surprisingly apparent was the lack of patience with the multinationals and their pricing, Microsoft in particular.  This was not an undercurrent in the presentations.  It was right out there in the open. 

I remember getting into the debate a few years ago while still at Microsoft.  Some managers took the position that countries like India would obviously want to mimic the  "American" success of companies like Microsoft.  The debate continues along the lines that India would obviously NOT want to use open source software because it's IP hostile, and they really need to build lots of proprietary software businesses because it's a demonstrated way to "make money" and grow the economy.  Of course they would want to do so on a Microsoft software platform.

First, open source software isn't IP hostile.  It depends upon strong IP law.  Second, countries such as India are service-based today, and that means EVERYONE gets to take home some money rather than focusing the wealth in the hands of a few.  (The last thing India wants is a return to the days of the Rajahs with a handful at the top.)  Lastly, (and this is the kicker), when you scale out the amount of economic growth that's taking place in countries such as India and China, the last thing they want to do is ship massive amounts of hard currency OUT of their economy to the U.S. for the privilege of developing software to improve business.  (And Microsoft is a veritable Hoover in its structuring of its subsidiaries.  No amount of in-country R&D re-investment can make up for the amount of money at risk here.)  Open source rules in a case like this.

Leap forward to China.  Same story.  Same debate.  Same mistaken thinking from the Western multinationals that somehow China wants to be like them or worse yet, ship all that money out of the economy (government perspective) or the market (corporate perspective).

I understand a naive Western marketing person's desire to believe that China is their next growth market but they fail to understand the economics involved.  This is why Linux rules here -- the cost of goods sold is significant when you add up the royalty payment times the population of customers.  I have held a Motorola Ming phone.  Developed in China for the Chinese market.  It is the sexiest little piece of hardware on the planet, and incredibly functional.  It's Linux-based. 

Why would Motorola want to send that much money in royalties to Symbian or Microsoft?  Yes, yes, I can hear the "we're so valuable" statements from those marketing managers already.   Frankly, I don't really want to read Word documents on a two inch by three inch screen.  The Ming is a work of art.  But I digress.

Several interesting items came out at the conference:

• China has its own document format standard called UOF.  It is somewhat consistent with ODF.  There is to be a convergence.  I learned at dinner one night that Red Flag has already built UOF support into Red Office, so hopefully the support will rapidly ripple back out through the OpenOffice.org community and the rest of the ODF supporting products will soon support UOF as well.  (Andy Updegrove also attended the conference.  He has made the connections and will hopefully have a proper article on UOF soon on his blog.)
• China is very respectful of IP.  They value patents.  They seem to be uninterested in supporting software patents.  They do however understand how patents might make a mess of the standards world, and are very interested in work like the new ex-ante based IPR policy from VITA.

This was the first event in which I've participated where there was simultaneous translation going on.  My slides needed to be handed in a week in advance such that they could be translated as well.  Wireless handsets were available so you could listen to the translation.  While one screen had the slide in English, the other had the Chinese slide.  Attendees and speakers simply worked in their native language.  It was fascinating to see it all just work.   

I've posted all my photos on flickr from the conference and the conference dinners.  I still need to get some names tagged, but it's a start.  All in all a great conference.  I learned a lot, and it was a privilege to participate.

Post to del.icio.us
digg it

www.flickr.com

This is a Flickr badge showing photos in a set called Open Standards, IPR, Innovation Conference. Make your own badge here.

Oracle and Red Hat Redux

I've been asked several times since arriving in Beijing what I think about Oracle's recently announced move to support Red Hat linux cheaper than Red Hat prices it. I've certainly been vocal in the past about Oracle and their possible Linux distro.  Dave Gynn and I were having this discussion before I flew to China.  So here's how it lays out.

It's Good for Customers:
It is certainly going to create some perceived competition for Red Hat.  r0ml has told the story of his time at Merril Lynch and his frustration with Red Hat's support and maintenance pricing.  He was happy to pay maintenance on each and every machine in his server cluster.  However, paying for a fixed number of support calls on each and every machine in the cluster rather than a cluster wide number of calls was a little frustrating.  With competition comes creativity, and I have confidence that Red Hat will meet the pricing challenge with an appropriate customer valued offering. 

It's Good for Oracle:
I was pretty vocal in the Spring and Summer about how it would be engineering inefficient for Oracle to eat the cost of maintaining an entire "forked" distro themselves.  Ellison was pretty clear back in the Spring, however, that Red Hat wasn't meeting the needs of his customers with updates, etc. 

Instead of living on a complete fork, Oracle will now ensure the stability of their offering to their customers by supporting them directly with the necessary patches.  This is certainly less expensive than running their own distro.

It's Not Necessarilly Bad for Red Hat:
There's certainly been lots of doom and gloom voiced about Red Hat's future and speculation about whether or not Oracle wants to weaken Red Hat to acquire it.  There's been lots of had wringing about the future of open source software businesses as more "big vendors" get involved. 

Piffle.

First, Red Hat's business continues to grow at a nice pace.  There are lots of new Red Hat customers (and existing customers expanding) that are not Oracle users and that still want the level of service and support provided by Red Hat.  These types of customers aren't going to flock to Oracle for "cheap" support, because that's not what Oracle is actually going to be good at.  As MySQL and Postgres deployments continue to grow (possibly on Red Hat linux), Oracle will also have a different set of things to worry about.   

Second, it's actually an opportunity for Red Hat to re-open discussions with Oracle about providing support for Red Hat Linux that meets Oracle's needs.  It would still be more engineering efficient (likely) for Red Hat engineers to do the work for Oracle.  So Oracle would win, and Red Hat would continue to reap the back end (reduced) revenue, as Oracle continues to drive deployments. 

Lastly, Oracle is participating in the open source community, just like IBM, Sun, Novell, and every other vendor of note.  Each participates to their own needs, contributing appropriately in community.  Saying that "open source software" is at risk suggests that each of these vendors has the same motives, to somehow bring down open source by turning it back into a proprietary world.  That's just clearly not true, even if it were possible.

Post to del.icio.us
digg it

Beijing Bound

I am back to Beijing after an absence of almost four years.  This time I will have a week to spend, with a standards conference anchoring the trip, but a little more sight seeing time and a number of meetings set up by friends.

I started with a great meeting with Mingbao Liu, CEO of Beijing SunWah Future Software, and the makers of the SunWah Linux distro. 

It was good to get his perspectives on his Linux and software businesses in China.  China is definitely booming, and everything feels very different from the last time I was here.  It's not simply a feeling of busier times, but more sophisticated times.

I next had the privilege of meeting with Professor Lu Shou Qun, chairman of the China Open Source Software Promotion Union (COPU).  He had many questions for me about standards, open source and IPR, based on my eclectic background.  He shared his views on the importance of open source software to China's future.  I also had the pleasure of seeing his "wall of fame" collection of photographs.  Many people responsible for the successful communities and companies we take for granted in the open source world have visited with Professor Lu.

All in all, an auspicious start to the week. 

(L-to-R: Professor Yuan Meng, me, Professor Lu Shou Qun, Theresa Tang.)

Post to del.icio.us
digg it