Once More unto the Breach

Visualizing Open Source Business Models

Matt Aslett gave a great talk about the evolution of open source business strategies last week at the Open Source Business Conference in San Francisco. In it, he presented a model to allow one to visualize businesses that use open source in their solutions, and what it means in terms of relationships with customers and the community.

The community relationships are driven by the lower triangle:

The customer relationships are driven by the upper triangle:

Matt goes on to apply the model across a collection of companies and business models, visually demonstrating how different companies have made different choices and evolved those choices, as well as playing out a number of scenarios. It's an excellent model.

Matt and I have debated in the past as to whether or not there is such a thing as an open source business model. I've argued there's no such business model, but discuss it as a set of tools that are applied to the business. Regardless of one's opinions however, Matt has provided an excellent visual model for the discussion and presentation of the ideas. It works in much the same way as the Business Model Design template in visually capturing the information to ensure a completeness of discussion and an understanding of how the parts relate. I'm looking forward to the continuing evolution of the model over the coming year as he prepares the next major open source business report from the 451 Group, and would encourage you to give the entire presentation a read.

Open Source Software Economics in Pictures

Updated [22-Mar-2010]: Added a little text around the Ohloh javascript widget so Google Reader sees a URL to follow.

Recently, I've encountered several technologists that still don't understand open source software economics and got suitably cranky about "people giving away software for free" and "destroying the value of innovation". I thought it time to try to reach for an easier way to demonstrate what's happening in the industry in pictures.

Everyone is familiar with the idea of a normal "bell curve" distribution representing R&D investment over time. As a technology is better understood and a product succeeds in the marketplace, R&D investment increases, and over time as new technologies advance, the R&D investment in the original technology and product wanes. The integral represents the total R&D investment over time. The function can also represent the "knowledge" gained or the increase in the intellectual asset base.

Good companies develop and invest in new successive waves of sustaining technologies. So, looking at Microsoft's success with PC operating systems, DOS was replaced by a greater investment in a more innovative Windows, was replaced by a larger investment in a more innovative NT.

This also fits nicely with Christensen's original observations about incumbent companies being good at sustained innovations and well run companies knowing how to jump from technology to technology along a sustaining innovation path. This all makes sense when considering a single company's R&D investment. It applies equally well to Sun Microsystems when considering that the steeper slope of successive sustaining innovations was on the hardware side versus the slower (but not inconsiderable) investment from SunOS (a BSD variation) to Solaris.

The investment curve for projects like Linux and Apache, with lots of individual and corporate contributors, still looks like a bell curve, but the contributions might better be viewed as a stacked bar chart. Individual contributors invest to meet their specific needs. Because there is enormous overlap in their common needs, they all share the overall investment.

Individual contributors get enormous return on their investment. (One gives a few bug fixes to the Apache httpd team, and in return one gets an entire HTTP daemon.) Corporate contributors give for the same ROI. They get enormous return on their investment in technology they use in a product complement space or as a component in their overall solution to the customer. (Before someone takes issue with my Red Hat example above below, understand the "solution" in the customers mind was "UNIX-like servers on inexpensive 'PC' hardware" and not "Linux".)

Christensen was careful in subsequent work to point out that the disruption wasn't about technology but about business model. The disruption often started when someone assembled standard cheaper lower performing parts into a solution that solved a completely different need with a very different cost basis. The new solution begins its own sustaining innovation curve until the new technology can compete with the incumbent compared against the criteria about which the customer/consumer cares.

The disruptive business model isn't about Linux so much as the ability for corporations to do collaborative development at the component/complement level in a "frictionless" well-managed Internet-enabled community. (The original OSF/1 shared-development of a UNIX-like replacement failed: too few players, too much politics.) Linux is a much stronger disruptive business solution as a way to handle a particular sourcing problem.

It would be interesting to consider the difference between projects with enormous inbound code contribution (versus all the other strengths a well run community brings to the table) distributed across a wide group of players like we see in the Linux and Apache projects, versus projects managed more tightly by a company like MySQL was. Another interesting attribute of this collaborative business model to investigate is how contribution mutates over time. Christensen's work demonstrated that an incumbent gets in trouble when they begin to over-deliver on functionality for attributes their customers consider important. The customer can't absorb the sustaining technology innovation any faster and literally won't pay for it. The slope of the sustained innovation of the competing technology is sufficient to cross into the space covered by the incumbent's solution.

In a shared collaborative development environment, however, because the technology isn't being driven by a single corporate entity, the community of corporations collectively contributes to their own needs and the technology may (i) stabilize where it needs to stabilize, and/or (ii) be taken in new and interesting directions. There is less pressure (if any) to over-deliver with new innovation. The consumers are the developers, but it's a very broad community indeed. This is what I believe just happened with the MeeGo announcement and the combining of the Nokia Maemo and Intel Moblin projects. This is a great inflection point for Linux into the new mobile Internet device space.

One only need read the report from the Linux Foundation charting the growth statistics in the Linux kernel to understand the enormous value generation happening release-on-release, four times a year. Using the Ohloh rules-of-thumb of US$55,000 per person year one gets US$142M of value creation in the 2.6 Linux kernel. The fact that some business models have been destroyed (Sun), or threatened (Microsoft) doesn't mean there's not enormous ongoing value creation in the technology.

Ohloh value chart for Linux 2.6 kernel.

Neither is intellectual property being "destroyed". Again, this is a disruptive business model discussion. Intellectual property is a business choice made on how a company will protect certain intellectual assets as legal property. Which assets to protect, and how, and which property to defend is a business choice based on the cost model a business uses with respect to turning assets into value propositions customers will buy. When a group of companies chooses to collaboratively develop a technology complement/component, they're making a business model choice on how they will selfishly share certain intellectual assets. Nothing was destroyed along the way.

MeeGo: Nokia, Intel and the Future of the Mobile Internet Platform

This week Intel and Nokia announcement the merge of Intel's Moblin and Nokia's Maemo platforms into MeeGo, a single platform for mobile computing. This is a great announcement for a number of reasons.

Nokia demonstrated it's ability to participate within active open source communities as it developed and launched the N770 tablet as a consumer device and maemo as a computing platform several years ago. (The N770 pre-dates the iPhone.) This wasn't a cut and run on the Linux kernel to grab a fork then forever be stuck supporting it. This was an excellent demonstration to themselves that they could use an active royalty free OS and continue to share the development costs. Ari Jaaksi's report on the experience is enlightening. Nokia has since acquired TrollTech, released the Qt tool kit appropriately, (and then acquired Symbian Ltd. and released its handset OS software assets into the open source wild through the Symbian Foundation).

Intel developed and released Moblin over the past few years as a Linux distro for mobile computing. They carefully positioned it NOT for handsets, but for all the other cool mobile Internet devices in your life like tablets and in-vehicle systems. They could do lots of interesting device related work on the Linux kernel for things in which the mainstream Linux wasn't interested and still get the cost advantages from shared development for the platform as a whole. In a very short time it has become one of the more interesting Linux distributions from a hardware innovation perspective.

The positioning is key here. By focusing this on "mobile Internet devices" they avoid the whole iPhone versus Android debate, Windows Mobile has no comment to make, LiMo is still wandering in the wilderness, and Symbian isn't in a position to comment. All of those are thought of as handset operating systems. This is future forward and about the mobile Internet. And don't just think iTouch and tablets in the coffee shop. Think of your home as a wifi space. Microsoft and Apple continue to demonstrate that people DON'T want another PC in the living room for media management. So what are all the other devices you can imagine in your home that are NOT "computers" that could become the synchronization hub of your world's information and media.

• What about a wifi device suctioned to my refrigerator door where the shopping lists are kept and the family calendar at a glance (with reminders),
• or a device that looks like a VoIP phone with a wireless handset in a stand that also has the family phone book(s) in it, but synchronizes with your mobile phone handsets for calendars and contacts,
• or what if my "media centre" didn't look like a media centre at all, but was a tablet that talked to a black box shoved out of site behind the couch, but would also sync my mobile phone or Kindle or Nokia N900 Internet Tablet,
• or there was a small charging pad on the kitchen counter where keys and mobile phones and personal media players are dropped to sync across family calendars, contacts, and the latest episode of a show I'll watch or listen to on tomorrow's commute (while inductively charging my phone).
• What if all these devices could communicate with one another?

All of these imaginings will need an operating system. Microsoft may have made computing in the home ubiquitous in a PC-centric world, but no consumer OEM or ODM today will want to repeat history and watch all high margin profits go to a single software company via royalties. Maintaining individual forks of Linux isn't cost effective either. But sharing the value creation of a robust complete applications platform in an open source project free to all would certainly answer the call.

Berkus's Ten Ways to Destroy Community and Bacon's Art of Community

This was a great week for reviewing "community building" resources in my world. I discovered Josh Berkus's recent Java One presentation, "Ten Ways to Destroy Your Community", and I received my reviewer's copy of Jono Bacon's "The Art of Community". [srw — I was a pre-publication reviewer for Jono.]

Berkus's presentation is absolutely brilliant. After pointing out very tongue-in-cheek why your community is such a painful group of people (e.g. "They mess up your marketing plans by doing their own marketing and PR" or "They mess up your product plans with unexpected innovation"), he proceeds to give you a perfect run down of ten ways to be rid of them with excellent examples. In order:

1. Difficult Tools
2. Encourage Poisonous People
3. Don't Document Anything
4. Closed Door Meetings
5. Lots of Legalese
6. Bad Liaison
7. Governance Obfuscation
8. Screw Around with Licences
9. Stop Outside Committers
10. Be Silent

The sad part of this list is how true it is. While Josh picked examples from his experiences, too often you visit a site to evaluate a company-led (or consortia-led) open source project to find too many of these counter principles in play.

Jono's book was published last Summer. His lyrical metal prose conveys his brilliant experiences over past years in community involvement, then community development, culminating in one of the best led community examples around Ubuntu. While Jono's eleven chapters don't align neatly with Josh's ten weapons of mass distraction, there is method and madness to attack each of the problems (or hopefully to avoid them altogether).

1. Difficult Tools [Chapter 5]
2. Encourage Poisonous People [Chapter 9]
3. Don't Document Anything [Chapters 3-5]
4. Closed Door Meetings [Chapter 3,4,8]
5. Lots of Legalese[Chapter 8]
6. Bad Liaison [Chapter 11]
7. Governance Obfuscation [Chapter 8]
8. Screw Around with Licences [Chapters 1,2,8]
9. Stop Outside Committers [Chapters 4,8]
10. Be Silent [Chapter 3]

If you need a quick litmus test to check on your community, read the presentation. Once you [honestly] suspect there may be a problem [or two], dig into book. Enjoy.

Conversion Rates (Again), Open Source Business Execution, and JBoss

Readers know I disagree with the facile answer that businesses that use open source software need to "convert" their user community into customers. I've laid out my concerns in two blog posts over the past couple of years (here and here). Today, reading Matt Aslett's (always useful) 451 CAOS Links I came across this gem from David Skok on developing the JBoss business pipeline.

If I had to summarize my overarching concern with conversion discussions (and wearing my customer hat), it's that sales and marketing types confuse conversion with selection. They're trying to jump start leads by applying historical pre-web lead qualification thinking in a world where the web allows potential customers to self-educate and then self-select. The process and thinking that goes into this JBoss case study isn't simply good for open source related business strategy. (I really wish we'd had this level of process and the tools to support it 15 years ago when we started Softway Systems.) Quotes that stood out for me:

The first question we looked at was: Did they know the names of the people that had downloaded their software 5 million times? The sad answer was no. Not only did SourceForge not allow them to collect names, but even if they did allow it, there was clear evidence that developers would simply not go through with the download if they were asked to provide their name.

Following one of the key principles of this methodology, we immediately realized that they needed to find a motivation to get the customers to provide the company with their contact information. The best motivation appeared to be the documentation, that they were currently selling. There was one big problem: selling the documentation was resulting in $27,000 per month in revenue, which was paying the rent and several peoples’ salaries. To me it was obvious that this was a small price to pay to get the names, but to the JBoss team, who had battled their way to get every dollar of revenue, that was less obvious. We debated this issue over the next three months, but finally they gave in and switched on the offer. It turned out to be a huge success: over 10,000 leads started pouring in every month. Over time this grew to 16,000 leads per month.

And ...

Later on the process, JBoss was able to look back at the customers who had actually bought the product and close the loop, by testing whether they had predicted the right events as qualification events. They did a lot of analysis to refine the events based on this information. Several of the original assumptions, based on common sense, turned out not to be true. For example, the amount of time that a lead spent on the website had little impact on their likelihood of becoming an opportunity or a closed deal. The same was true for time spent using the Wiki or the Forums.

Here was a process used specifically to "weed out" (qualify) customers from the noise of lead potentials in user and developer communities using the web site. The entire article is worth reading and careful consideration within your business. This is how JBoss "went on to reach an annualized bookings run rate of about $65 million a year within two and a half years after starting the process." Execution requires the right team, but it also requires the right process.

The CodePlex Foundation and the Free Software Foundation

The Free Software Foundation commented on the CodePlex Foundation existence on Monday. Presumably it was a slow news day at the FSF. Richard well describes his concerns and brings it all down to the standard list of concerns on software freedom, gently extending it out to all the additional freedoms that must be in place to say you truly completely support free software. He makes some conjectures based on his concerns and definitions, and finishes by rolling it back to warn people to stay focused on the FSF mandate on software freedom and avoiding Microsoft traps.

Sam Ramji (acting president of the CodePlex Foundation) posted commentary on Tuesday to correct a couple of FSF opinions, demonstrating he does understand that commercial software companies can thrive on free software and that the while some members of the board of directors and board of advisors may be Microsoft employees or ex-Microsoft (me), there remains breadth and depth in the bench of people participating initially that have real experience in the commercial free software world.

Once again we're having the Democracy versus Capitalism debate. Really, we need to move on. This is not a helpful debate. It started in the mid-1990s in the broader FOSS community itself. It unfortunately informed and fuelled Microsoft's messaging around Shared Source through the early part of this decade as they tried positioning everything on a linear spectrum with words like "free", "open", "commercial", and "proprietary". It doesn't work that way. It's the precursor to the Free and Open Source Software Business Model debate. It's about as useful.

The one nit I would pick with the FSF debate with respect to the CodePlex Foundation is when it opines about their definition of "proprietary software". The OED gives us a slightly better definition. Proprietary as an adjective means:

b. Of a product, esp. a drug or medicine: of which the manufacture or sale is restricted to a particular person or persons; (in later use) spec. marketed under and protected by patent or registered trade name.

It's about property. All our free and open source software licensing works because the software is someone's property covered by copyright. Proprietary software, however, actually would mean protected by patents and trademarks. So, Fedora, Linux, MySQL, Apache, and so too I believe "GNU Emacs". We need to get beyond the debate.

Stallman does say:

Someday we will be able to judge the organization by its actions (including its public relations).

I'm fairly sure the CodePlex Foundation will never live up to the FSF definition of software freedom purity, but I am looking forward to getting more organizations to contribute software and collaborate on development using free and open source licenses. And that's a pretty good thing.

Making Money from Open Source and the Business Model Debate

Matt Aslett makes great observations about open source business models in a recent blog follow-up discussion:

I am very glad that they took that decision, because in hindsight the statement “there is no open source business model” would have been inaccurate in the context of our report. We identified that there are multiple models used to build a business around open source: theoretically hundreds.

The 451 Group did a lot of research as they developed their model of discussion, and their definitions around development model, license choice, and revenue trigger are great. But it still feels like they start falling victim to the shades of grey slicing problem.

I'm still more of a fan of the tool analogy. As a company, you have a certain budget to spend developing the product, it's marketing, sales and distribution. Imagine a proper old hardware shop where you have a certain budget and need to figure out how you're going to spend to buy what tools from which aisles (development, marketing, sales, legal) to launch and build (and maintain) your product. "Open source licensing" is a set of new tools in the legal aisle and "collaborative community development" is a new aisle. It's not that there are hundreds of business models, but rather one can combine the tools in hundreds of ways. (Some ways are more proved than others depending upon the business.)

Indeed, "dual licensing" doesn't even belong in the open source licensing tools. It's an attribute of copyright law. I can license my intellectual asset to as many people as I want in as many ways as I choose. The Microsoft EULA attached to software at the local office supply store is different to the Enterprise Agreement signed when a corporation purchases based on a bundle of units and services is different again from a volume license to a smaller organization. No one accuses Microsoft of "dual" or "multi-licensing" their software. The fact that MySQL began closed licensing royalties as well as selling service agreements subscriptions (i.e. product) of their GPL distributed software does not mean that they invented "dual licensing".

The fundamental question around which this all revolves is the confusion embodied when one asks, "How can you make money when you give the software away for free?" Large "software" companies (Microsoft, SAP, Oracle, Adobe, etc.) have spent a lot of time questioning the scale of "the business model(s)" rather than looking at the opportunities the tools provide. In the end, they need to understand that it's not the "software" that a customer is buying but the solution and the support and maintenance and certified tested warranted removal of risk embodied in their product packaging and testing capabilities. (This is a core competency Microsoft has over most "software" companies when you consider the size of the test matrix defined by OEMs, ISVs, and device manufacturers that needs to be exercised between code complete and release-to-manufacturing.) Whether you call it a "license" fee and then charge 20% of the license fee per year for maintenance, or distribute the "license" fee into the maintenance "subscription" over time isn't a discussion about open source. It's just business.

Open Source Software and Product Management Tools

Matt Asay has a great blog post today on what Alfresco has learned with regards to their use of open source and product management, from both the perspective of their own product development feedback, as well as the strength of reuse by their customer base.

For years, our marketing has targeted buyers in these markets, pitching a low-cost, high-value alternative to proprietary ECM/WCM/RM.

Our customers didn't get the memo. While we were talking about ECM, many of the roughly 30,000 people downloading the product every month were using it as a foundation upon which to build their own applications, most of which would never be classified as ECM. They were creating their own category of infrastructure/middleware, using our technology.

The content application server was born, and we almost missed it, despite the fact that it was happening with our code. We were so busy marketing our vision that we almost missed listening to our users' vision(s). This new vision on an old way of using our product will significantly impact everything we do for years to come.

This is the sort of strategic edge I meant yesterday when discussing the extra tools a product manager has when open source software is added to the mix. Matt also points off to Vinnie Mirchandani's posted observations on how mainstream IT is rediscovering custom-built applications again. (Indeed it was exactly this sort of rationale coupled with open source software that was the impetus for the creation of Optaros in 2004 and why I went to work there.)

It really is about the engineering economic imperative of collaborative community development coupled with free and open source software licensing and enabled by the web and its ability to remove friction from the process. Developing good software is hard work, and we have shared software literally since we've been writing it. Brian Behlendorf gave a great talk around the time I began this blog where he made a number of key observations about open source repositories based on his experience. Open source projects don't "end" the way traditional development of IT applications end (sliding into withering maintenance) or vendor-led software products (being replaced by forced upgrades). Well run open source projects are much more organic. The software evolves and adapts. The building blocks are continually improving and very complex and powerful platforms can be constructed.

Carlo Daffura responded to yesterday's post with pointers to two posts supporting the idea of the economic value of open source software in product development. This certainly bears out our experience from 1995-1999 developing Interix (now Services for UNIX at Microsoft). Following one of Carlo's examples, Ari Jaaksi's paper is a fantastic overview of Nokia's experience launching the N770 and the cost savings to be had.

I essentially said yesterday that it's all just software business, that there is no "open source business model". Please don't misunderstand me. Open source licensed repositories and collaborative community development on the web substantially add to the tool set of product management on both the marketing and engineering sides of the house.

Open Source Business Models Redux

I debated again yesterday with a colleague on open source business models. I don't believe there is such a thing. Several well documented models have been articulated and debated (see Matt Aslett, Roberto Galoppini, Carlo Dafarra for excellent cogent examples) but when you get into the discussion it immediately degenerates when you try to assign certain companies to certain models. It degenerates further when you try to invert the discussion to argue that these stylized business models share attributes or can be applied together when discussing example companies. To me it's a useless rat-hole of a discussion.

It confuses audiences into thinking "open source" (or "free software") is different in a business context. Such confusion:

• Slows adoption by customers.
• Causes investors to hesitate.
• Can lead inexperienced start-up executive teams to chase ghosts instead of focusing on the business at hand.

Here's how I tried to articulate the counter-debate yesterday:

1. Customers buy solutions. In the immortal words of Theodore Levitt (Harvard Business School), “People don't want to buy a quarter-inch drill. They want a quarter-inch hole!”
2. Geoffrey Moore wrote "Crossing the Chasm" in 1991. As well as clearly articulating the Technology Adoption Life-Cycle (that he has evolved over the ensuing ~20 years), it helps people understand that developing a "whole product" offering (the core product and its complements) provides a better solution to customer needs and companies in a market that provide the best whole solution succeed better than their competitors and peers.
3. For technology solutions companies, there are a well understood collection of tools that product development management uses to deliver solutions.
• Buy or build complements and include them in the base product.
• Publish interfaces to encourage complement value add in an ecosystem of partners.
• Provide tools and frameworks to ensure partners can easily build complementary products in the ecosystem, providing an even bigger "whole solution" or enabling it to be re-positioned into new markets (i.e. onto new problems).
• Publish tutorials, how-tos, books, etc. to ensure people understand the product solution and can provide complement value add in the ecosystem. And publish here is a very loose word. Consider magazines and conferences and user groups here as well, and how the web helps or supplants each. The web removed enormous friction from this collection of related tools.
• Develop training programs to ensure people understand the product solution.
• Develop certification programs to ensure a good supply of knowledgeable people on the solution.
• Provide consulting services to ensure an immediate supply of knowledgeable people on the solution. Really though it could be other services as well (maintenance, repair, operational, etc.)
4. Companies can choose to sell (or license) the complement or give it away. In each case there's an opportunity for direct or indirect revenue. As long as the sum of the revenues is greater than the sum of costs of providing the whole solution (and operational margins are within tolerances specific to the "tool" or tactic or mix in the portfolio) the company is profitable and thrives. [Indeed, over time as value moves around the solution network — and it's a network not a stack — companies have a better chance of survival if they control more of the higher margin pieces of the network that is their whole solution or ecosystem. Think IBM with the breadth of whole solution they can deliver posting better than expected results September 2008 as the rest of the economy tanked.]
5. The larger the company, the more tools it likely uses in providing a whole solution. Maybe this is the corollary to the above statement. It certainly explains why we all rat-hole when trying to fit large complex companies into the stylized business models.
6. Adding open source licensed software repositories on the web and collaborative community development into the mix adds new tools, and evolves old tools:
• To "buy" vs "build" for complement value add, you can add "borrow" (IBM Websphere and Apache, and Red Hat and RHAS) and "share" (IBM and the original Eclipse project, and Intel and moblin).
• New companies (Red Hat) with lower margin business models (compared to the incumbent) can use F/OSS components to rapidly develop products that either serve new markets or serve the bottom end of an over-served market and then evolve over to or up into an incumbent’s market space. [Classic Christensen economics here.]
• It broadens the base of "users" which opens future customer opportunities and locks out competitors. (JBoss and MySQL used this tool.)
• Companies that participate in communities:
• Can rapidly develop complements to core offerings in their solution network (without necessarily building complete products), e.g. SAP and MaxDB and MySQL
• Can amortize dev/support/maint costs of software components across customers/partners/competitors (e.g. the vendors in the Linux Foundation today are no different than the vendors in the OSF 20 years ago sharing the development costs of OSF/Motif and OSF/1 as royalty free base technology).
• Get to interact directly with like-minded customer prospects in community, influencing customer/partner developers.
• Build brand awareness and trust through transparency of actions.
• Companies that participate deeply in communities better influence those communities (e.g. participate, hire, or acquire).
• Companies developing their own communities increase the opportunity for partners to provide complement value add as well as encourages engagement and commitment through participation and contribution.
• Companies can use F/OSS projects to reduce the cost of sales by allowing users to try and pre-qualify themselves as customers.
• F/OSS projects are an interesting publication strategy against competitors from an IP strategy perspective.

What all of this means is that the ideas need to be turned around. Technology businesses and technology adoption is well understood. We know how to measure successful companies and compare them. We understand the tools those businesses use to engage customers and solve problems. Open source software is a key economic driver from an engineering efficiency and software reuse perspective, but it also opens new opportunities and additional tools for product management to engage better with customers and improve both the top line and the bottom line.

But there is no open source business model.

Open Source Business Tactics in One Slide

I recently found a slide I used six years ago to explain open source software in a business context to Jim Allchin back when I worked for Microsoft and Jim was executive VP of all Windows. My job was to develop an open source engagement model, working in a team called Platform Business Management, which reported directly to Jim. Jason Matusow was responsible for driving the Shared Source agenda, initially working in the Windows marketing team and later as an immediate peer in PBM. The meeting itself would have been sometime in June 2003 (so shortly after Sun's threatened injunction against Windows). I tried to ground the tactics in product practices Microsoft already well understood and with company examples pulled from other large multi-billion dollar corporations, i.e. while our shining open source company examples might have been Red Hat, MySQL, and JBoss, they were meaningless examples to Microsoft based on revenue size. The slide worked. Jim understood why Microsoft needed to adopt its own open source practices, and how we might start. [There were other slides in the presentation discussing options for engagement and contribution that are confidential.] The execution was another matter entirely within the software product executive culture of the company, and isn't relevant here.

There are a few things to consider as you read the slide and the notes I used to present additional material:

• The information density of the slide is normal at Microsoft (or was in my day) for exec presentations. It complemented a style of discussion that's come to be known as precision questioning. You simply don't have the discussion and decision making flow required if you're trying to drive a particular train of thought through a slide build and flow. This sort of info density is about presenting the maximum amount of related material visually and letting the exec drive the questions. It's amazingly effective if everyone understands the protocol.
• I've not changed any of the wording on the slide or the associated notes. [There's nothing confidential.] Some things may feel dated, and I've certainly evolved and expanded some of my thinking, but I still stand by what I wrote. There are few words I would change today and while I might pick more current examples, these ones were absolutely relevant at the time.

Here's the slide:

Here are the notes I used with the slide:

OSS Development Projects (technology buckets):

Bullet 1 and 3. Good developers develop good software. Good developers have discipline and process. They don’t know how not to have discipline. So version control, CM, design reviews, strong vision communication, automated build management, coding standards, automated test harnesses, bug tracking, peer code review, strong tool support. All understood and published for decades. None of this is attributable to OSS as a development methodology or licensing mechanism. You can think of this in the inverse: of the thousands of OSS projects hosted by SourceForge, why are so few (relatively speaking) noteworthy? (There's also a couple of good papers on how few people actually anchor the few key projects.)

Bullet 3. The projects in the OSS world that matter are anchored by good developers and they're developed using a UNIX development mentality. They have all been developed since the advent of "cheap" networking (at least between the universities and major corporations) through the Internet (email, netnews, and ftp). The Internet enabled the rise of OSS -- not the other way around -- and it was the low-friction medium through which people could share the software. Add a license that requires source code publication and permits libre use of the source code onto the UNIX component model and you have the techno-social movement.

Bullet 4. Examples: the individual contributor to Apache (gives “3” bug fixes but gets back 100s), versus Shell Int’l contributions in a team (code/$$) with management approval to Samba.org (while deeply protecting their own software assets), versus Sun contributing the accessibility features to the gnome desktop in return for a complete desktop for an advanced “UNIX” based desktop.

Bullet 4. People value the work they do differently in different contexts: think of a technical publications person using their writing skills to complete documentation at work, helping their child’s class room complete a writing project in a parent-child project, and writing a sonnet to someone they care for. Same skill set in all three situations, one for money, one as a contribution in community, one as an act of friendship. Or a program manager that spends time on a not-for-profit board in their community using the same skill set they use at work for money.

So what's next?

Applied OSS:

Bullet 3. Msft is an expert here. Publish specs to drive complement value add. Provide certification programs to ensure lots of service providers. Buy, integrate, and bundle. Etc.

OSS Becomes Big Business

Bullet 2. From IBM’s point of view in the product marketing space: every apache installation is a potential customer for Websphere. From a Linux perspective, they are driving home the message that OSS and Linux are the fulfillment of all “our” investments in open systems and open standards, using multiple congruent tactics of OSS participation, standards participation, and patent license management to control the AIX commoditization – which they publicly state is happening – then quickly qualify the remark to a 10 year time frame. With Eclipse, it’s no longer “buy” versus “build” versus “borrow”, it’s “share” to control the java development space and drive complement value add around their world.