Dave Rosenberg wrote an interesting post titled “Open source becomes paid software in 2009”. He writes:
“I suspect that in 2009 it will start becoming clearer as to what you pay for and why you should. Redmonk analyst Michael Cote made the prediction that next year “it will be cool to pay for software” and I agree. It’s one thing to consume open-source software and quite another to pay for it. “
First off, I think Dave is taking some liberties with Cote’s original prediction about paying for software. Cote wrote:
“Small Change for Small Applications: When it comes to making money with software, the iPhone App Store is the glossiest example of trend I feel creeping up on us: people paying for software.
The change here is an environment where people will spend $0.99 to $20 for a piece of software.”
Paying $0.99 to $20, for software may be back in vogue with consumers. However, I’m not sure this trend is wholly applicable to the enterprise open source software movement. On one hand, I can’t think of (m)any enterprise open source products (with support & updates) that are priced under $20 . Second, just because a developer is willing to pay $1.99 for iFitness via iTunes doesn’t mean that he will pay for MySQL (for example). Will the developer’s employer pay for MySQL? Possibly, but I suggest that the decision will have nothing to do with the coolness of paying for software.
Historically, less than 1% of enterprise open source users have paid for the right to use the software. Dave suggests that a move to “open core” licensing will increase the rate of payment. The “open core business model” is similar to what I was proposing in the summer. Basically, an “open core” product is free and open source, while the vendor derives revenue from selling proprietary, possibly closed source, extensions on top of the core product.
I agree with Dave that a shift away from the “support-based open source business model” towards the “open core business model” will increase the percentage of paying enterprise users of open source. This will be especially true for new open source vendors. However, I think it’ll be more difficult for an established open source vendor not currently using an “open core”-like business model to shift to this model. The open source purists will disapprove.
Here’s hoping that in 2009, more open source vendors will ignore the cries of disapproval and adopt an “open core”-like business model. More paying users = more revenue = more development funding = more features & higher quality products = happier users.
Will you convince your company to pay for open source products that utilize the “open core” business model?