I had to laugh…I took a look at Microsoft’s new open source web page, and decided to tag it for future reference. When the del.icio.us window came up, there was an interesting tag on its list of both recommended and popular tags.
Apparently del.icio.us users see quite a bit of “humor” here (and understandably so).
(Click on the image to expand.)
Updated below. Updated again.
There’s been some conflict regarding commercial open source, aka the SugarCRM model, and whether it is truly open source. Last month, Michael Tiemann, President of the Open Source Initiative, said on his blog:
…THESE LICENSES [SugarCRM, SplendidCRM, Centric] 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.
I don’t think it’s fair to say that these companies are just trying to get away with something, but I’ll let that go for now. Tiemann continues with a call to action:
So here’s what I propose: let’s all agree–vendors, press, analysts, and others who identify themselves as community members–to use the term ‘open source’ to refer to software licensed under an OSI-approved license. If no company can be successful by selling a CRM solution licensed under an OSI-approved license, then OSI (and the open source movement) should take the heat for promoting a model that is not sustainable in a free market economy. We can treat that case as a bug, and together we can work (with many eyes) to discern what it is about the existing open source definition or open source licenses made CRM a failure when so many other applications are flourishing.
So fair enough. Let’s take the many “open source-lite” companies like SugarCRM and ask why they (and their VCs) feel a pure OSI-approved license won’t work for them as it has for Red Hat, mySQL, Apache and so many others.
The first “bug”, if you will, in the OSI approved model is that it doesn’t reflect in any way the natural lifecycle of application development. Getting from release 0.0 to 1.0 requires a significant capital outlay, much more so than to get from release 1.0 to 2.0. There are several reasons for this. First, building on top of and refining a stable, working application, as OpenOffice has done for example, is far less work than creating a stable, working application to start with. Developing the initial application architecture and getting it to the point that it can be used by a naive end-user is a huge step. Secondly, this initial development has to be done in the absence of any paying customers, so none of the effort can be funded out of revenues. And lastly, it is much harder to get community participation in a fledgling project, especially when it is not an application that hackers have any use for themselves. Community contributors typically scratch their own itches, and not many of them have a CRM itch.
Compare SugarCRM’s situation with a typical mature open source project. More often than not, successful open source projects were building on top of an existing and fairly large code base. These code bases were made available under varying circumstances: Linux reached version 1.0 through academic interest and participation, and OpenOffice was the commercially failed StarOffice system donated by Sun, just as Firefox inherited the (albeit ugly) code base from Netscape. Regardless of how the initial code bases were open-sourced, they allowed the project to start with a stable release and to avoid the big upfront capital outlays required to get there.
SendMail, Apache, mySQL Samba and Linux are all applications hackers use themselves, and they therefore have an incentive to help extend them to meet their own needs. Corporate contributors like Red Hat, IBM and Novell have huge, strategic stakes in seeing Linux stacks succeed, so they are willing to pay the salaries of community developers, and to fund organization such as the Linux Foundation. But individual and corporate contributors have no such stake in the success of open source end-user applications. Without them, development all falls to the start-up itself.
Given the size of the required capital outlay, and the lack of corporate funding, start-up open source companies have to rely on private capital, particularly VCs. The VCs invest for only one reason: so that their equity position will grow and become liquid so they can exit in seven years. We can decry VCs for being short-sighted capitalists (although I certainly wouldn’t) but the fact is they are the only source for capital for start-ups, and so they get to set the terms under which they will agree to invest. Don’t like VCs? Find someone else willing to invest $20 million in a software start-up.
The fact that these CRM start-ups have elected to go with a hybrid open source/proprietary licensing scheme demonstrates that OSI-approved licenses would not provide the financial results they (or their VCs) require. Given that customers and the open source community would, to some extent, prefer to license software under an OSI-approved license, there must be a reason these companies have chosen a different license. I can only assume they have determined that an OSI license would not allow them to generate the revenue required to obtain financing for the application’s initial development.
Once a stable, usable version of an end-user application has been released and achieved some measure of market acceptance, this picture changes however. Customer IT departments and third party software vendors now have an incentive to develop extensions to the initial release and contribute them back to the project. Even individual hackers would find it far more enticing to contribute.
While initial revenues would be consumed just to grow the software start-up to keep pace with demand, eventually revenues will turn into net income and market value. Through the maturing of the application and the contribution of community members, the investment required by the software company itself drops. It’s at this point that the VCs are able to exit, and the public equity markets are able to meet any ongoing needs for capital.
In a competitive market, an OSI-approved license would not only be feasible for a maturing project, but most likely required for the sponsoring software company to maintain market leadership. Customer and community members would be able to demand a more open licensing scheme, where they weren’t able to before. In this maturing phase, the software start-up would become what we all recognize as a true open source software company.
The “bug” in the OSI licensing model is that it does not account for this lifecycle view of software development, and does not provide a viable way for start-ups, particularly start-ups developing end-user applications without an existing code based to build upon, to attract the capital required to reach maturity. I would like to see the OSI talk to start-ups and VCs and find a way to accommodate the needs of start-ups. My concern is that, if they stick to their current stance, the current wave of software start-ups will end up reinforcing the view that open source is not economically viable for end-user applications, but only applies to commodity OSes and middleware.
Update: Events have put a lie to much of my thesis here. SugarCRM has announced they will be adopting GPLv3 for the community edition of their CRM software. They will still have a two-tiered licensing system (well, actually, three-tiered), with paying customers getting a richer, more functional application than the GPLed application. Perhaps that’s the important monetizing strategy here, not whether the community version is released under GPL vs. a Mozilla type license.
What’s interesting is that the change is attributed to pressure from customers. Although I assume we’re talking about customers of the free (as in beer) community edition, not the paying customers of the fuller versions, since they won’t be affected by this change. Makes me think it’s really because good standing in the eyes of the broader open source community really does matter to SugarCRM, and they see this as a small price to pay.
Regardless, the OSI and Michael Tiemann have won the battle — congrats!
Update 2: What’s more, Microsoft is now jumping on the OSI bandwagon:
Microsoft will submit its Shared Source licenses to the Open Source Initiative for review and approval as open-source licenses.
Bill Hilf, general manager of platform strategy at Microsoft, used his keynote address at the annual O’Reilly Open Source Conference in Portland, Ore. on July 26 to discuss Microsoft’s evolving open-source strategy.
As part of that, he highlighted a new Microsoft Web site designed to provide additional transparency into the company’s position on open source, and announced the company’s intent to submit its Shared Source licenses to the OSI for approval.
“Microsoft and the OSI are currently in active discussion on this and additional details will be made available in the coming weeks,” Hilf said.
A Microsoft spokesperson declined to give any additional specifics and, when asked what had changed to make this the right time for Microsoft to seek open-source approval for its licenses, the spokesperson would only say that “things continue to evolve when it comes to open source at Microsoft.”
(Emphasis mine.)
I’ll say.
A good op-ed from Steven J. Vaughan-Nichols:
I see the current uproar between those who partner with Microsoft–Novell, Linspire and Xandros–and those that swear off Microsoft partnerships—Ubuntu and Mandriva—as being just another variation on the theme of open-source pragmatism versus free software idealism.
…
Differences and all, though, the Linux companies still have more in common with each other than they do with Microsoft no matter who partners with the Windows giant or who doesn’t. One way or the other, they’re all out to carve out their own chunk from Microsoft’s territory.
…
Sure, Microsoft loves to see the Linux companies fighting with each other. Microsoft hopes that this will lead to a repeat of the Unix wars of the late ’80s and early ’90s, which made sure that the Unix businesses never mounted a successful challenge to Microsoft’s desktop operating system business and eventually lost the x86 server market to Microsoft’s own NT, which was followed by Windows 2000 and Server 2003.
Linux isn’t Unix though.
Bottom line — there’s no civil war, just healthy disagreement among companies committed to open source. Read the whole thing.
From The Social Norm of Leaving the Toilet Seat Down: A Game Theoretic Analysis by Hammad Siddiqi:
If a female finds the toilet seat in a wrong position then she will most probably yell at the male involved. This yelling inflicts a cost on the male. Based on this omission, women may argue that the analysis in [prior] papers is suspect.
In this paper, we internalize the cost of yelling and model the conflict as a non-cooperative game between two species, males and females.We find that the social norm of leaving the toilet seat down is inefficient. However, to our dismay, we also find that the social norm of always leaving the toilet seat down after use is not only a Nash equilibrium in pure strategies but is also trembling-hand perfect. So, we can complain all we like, but this norm is not likely to go away.
Bummer.
(h/t Andrew Sullivan)
Steven Vaughn-Nichols quotes Kevin Carmony, CEO of Linspire (who just signed a Linux deal with Microsoft):
“In the early days of Linux, we had no choice but to bang the ‘fight Microsoft’ drum (and as you know, no one did it better than Linspire) [Linspire was first known as Lindows and eventually reached an out of court settlement with Microsoft], because we needed to get everyone’s attention, including Microsoft’s, and to be honest, back then, Linux didn’t work very well on the desktop, so it was pretty much the only thing we could find to say about it to get attention.”
That’s no longer the case today, said Carmony. Microsoft has a better understanding of what Linux and open source is, and how to work in a cooperative manner with Linux, and we have a lot more interesting things to talk about.”
He continued, “It’s time to move past all of the idea that for Linux to succeed, Microsoft must fail. We need to let it go, and start working with ALL the players in the PC ecosystem, and that certainly includes Microsoft. I can’t speak for the rest of the Linux and open source community, but from Linspire, you can expect less fighting and name calling, and more attention to partnering to build a better Linux. We will certainly still compete, just like Apple and Microsoft still compete aggressively, but we’ve also [got to] build a bridge to work together when necessary.”
“There are those who want to isolate Linux from the other 99 percent of the desktop computing world, and if they succeed, Linux will never grow past 1 percent of the desktop market,” added Carmony. “I want to see Linux move in the opposite direction, and rather than be exclusive, more inclusive.”
Today I heard Steve Shreeve, founder and former CTO of Medsphere, speak at a local event on open source here in Pasadena. Shreeve and his brother founded Medsphere and were leading the effort to develop an open stack implementation of VistA (the VA health care software, not the proprietary desktop OS) until they were sued by Larry Augustin and the Medsphere board under the provisions of the DMCA.
Steve is an incredibly passionate guy, and has quite a story to tell of how Medsphere was founded and grew. He comes across as a very sympathetic person, as well as very bright (he has an undergrad EE degree with minors in Mathematics and Physics, then went to med school where he pursued a joint MD/MBA program). It’s hard not to like the guy.
But I’ve also heard Larry Augustin speak, and I was impressed with his grasp of the underlying economics of the open source software business. Medsphere is releasing its OpenVista in a two-tiered model, keeping much of the non-VA enhancements proprietary. I imagine their intent is to monetize the hell out of their development efforts, and I can’t blame them. It’s easy to see how Shreeve’s enthusiastic embrace of open source ran afoul of the Board’s desire for revenue.
So this is a cautionary tale: bright entrepreneur starts up company, and his VC-led Board ends up suing him for $50 million over an apparent mis-understanding regarding what was to be released under the GPL and what was to remain proprietary. Bottom line — get the details regarding what is to be released under which license nailed down before anything gets posted to SourceForge.
During his OSBC keynote, Eben Moglen said that “Science must be free. Knowledge must be free. Let freedom ring.” This parallels the argument he’s made in the past that patent software is akin to patenting math.
This is compelling rhetoric, and demonstrates Moglen’s abilities as a lawyer. But rhetoric is a double-edged sword, in that it can be put in the service of logic and truth — JFK or Martin Luther King come to mind — or in opposition to logic and truth. I believe Moglen’s rhetoric falls in the latter category.
There are two main flaws in Moglen’s arguments. First, he confuses knowledge with invention. My undergrad degree is in Physics, so I know first-hand the huge difference between Physics and Engineering. Our purposes were different, our training was different, our culture was different than the Engineering students down the hill at UCLA. The goal of the physicist is to further knowledge without any thought to its immediate usefulness. It’s rare that any new discovery in Physics has any commercial application within the twenty-year period of patent protection. Engineering’s goal, on the other hand, is to make things that solve an immediate problem, often a commercial one. They couldn’t be more different.
The same difference is found between theoretical and applied mathematics. When Calculus was invented by Isaac Newton, it had no commercial application. On the other hand, figuring out how to perform real-time Fourier transforms to compute 3D distance readings from sound echoes hardly advanced the state of mathematical knowledge, but it did make sonar possible.
Invention, and knowledge, two entirely different things that Moglen lumps together. Knowledge is free, always has been, and that didn’t change with software patents. Invention, a commercial activity, has historically been protected for a short period of time. I don’t know if Moglen deliberately confuses these two categories, or just doesn’t understand the difference, but either way, it’s a shame.
As a result of his confusion of knowledge and invention, Moglen implies that true invention must be instantiated in a physical invention, since any innovation instantiated digitally, according to Moglen, is not invention but knowledge. He is selling software short. Is invention any less deserving of protection because it results in software rather than a physical contraption? Software engineers should take offense at that implication. They are no less inventors, or innovators, than someone building a new hybrid engine or a nano drug delivery device. His artificial conflation of invention and knowledge leads to a necessary short-changing of digital invention.
What’s a shame is that Moglen doesn’t need to use these rhetorical excesses to make his case. His view is, at bottom, an ethical argument based on “the way things ought to be†rather than a utilitarian argument. But patent law isn’t meant to instantiate any moral construct; it is solely a pragmatic balancing act between the need for society to incentivize invention while allowing invention to be utilized broadly by society. Property fundamentalists on both the right and left argue for or against patents from moral principles, but the law does not.
Ultimately, the question regarding software patents is a utilitarian one: do they benefit the common good? This is where software patents fail miserably. The big software vendors, my employer included, file for software patents in a bizarre process of patent proliferation to make sure that their competitors infringe on as many patents as they infringe of theirs. Everyone is infringing someone else’s patents. Patents impose a financial burden on innovation rather than a financial incentive to innovate. They don’t work.
This is why software patents are a bad idea: in a strictly utilitarian analysis, they are not only unnecessary, but counter-productive.
It’s a shame that Moglen, Stallman and the FSF argue against software patents on moral grounds using inapt analogies like “knowledge = invention” and “software = math†when the utilitarian arguments are much more compelling and easily embraced. But the FSF is an ideological movement, and not a practical one. As a result, they hurt their cause as much as help it.
I spent the last couple days at the Open Source Business Conference, along with Gary Ardito. Unlike Gary and Matt Asay, I am not much of a live blogger, so here’s a recap of some of my thoughts a day after the fact.
I was struck by the stark contrast between the free software and the commercial open source crowds. While many of the keynotes advocated a free software ideology (and I don’t mean that word in a negative sense), the enterprise IT, open source start-up and VC speakers were very pragmatic. While Eben Moglen argued for the virtue of the GPL, SugarCRM was unapologetic about their use of their SugarCRM Public License. While Linux and Gnu have been developed by broad communities, the commercial open source companies have very little code developed by anyone not on their payroll. For them, open source isn’t a movement, or an ideology, or a moral and ethical imperative — it’s a strategy to build successful software businesses.
And it works.
Larry Augustin shared some software company P&L numbers from the golden years of the 1990s, the not-so-golden years of the late 90s to now, and the hopefully-new-golden-years of commercial open source. During the late 90s, sales and marketing expenses for software companies shot up, coming at the expense of R&D. The market tightened, and buyers could make vendors go through lengthy and expensive sales processes with RFIs, RFPs, POCs etc. The cost of generating leads by buying lists and cold calling became too expensive. The push model no longer was financially viable.
The advantage of open source isn’t so much in the development end, although there’s some benefit there. According to Augustin, the benefit is in moving to a pull sales and marketing model. Vendors don’t have to explain their software to prospects, because they already have it installed, are already playing with it. Trade shows have been replaced by Google, with a much lower cost way to educate the market and generate leads. The software financial model has returned to balance.
Not that there’s no advantage on the development side, but it’s not necessily in developing the core product. Community involvement helps with enhancements around the product, such as localizations, interfaces, integration etc. Danese Cooper of Intel, and formerly of Sun, talked about community involvement with OpenOffice. Microsoft has localized MS Office to 13 languages, which isn’t enough to cover the world. When OpenOffice was open-sourced, Sun saw this localization gap. They made it easy for contributors to localize OO, and the community got excited. For the first time they could have an office suite in Estonian, Malay or Swahili. And now they do.
So in spite of the moral and ethical dimensions to open source, for the majority of the OSBC attendees it’s all business. And that’s a good thing.
There were other highlights, such as a session on the MS-Novell agreement, but I’ll save those for other posts. It was two very well-spent days, so thanks to Matt and all the other organizers for a great conference.
Our new best friend Microsoft has raised the specter of their mythical 235 open-source-infringed patents, but of course they won’t divulge which patents these are. It kind of reminds me of the scene from the movie Field of Dreams where Kevin Costner is trying to get James Earl Jones to go to a baseball game with him:
I didn’t want to do it this way.
What the hell is that?
It’s a gun, what do you think it is?
It’s your finger.
No, it’s a gun.
Let me see it.
I’m not going to show you my gun.
Because, of course, there was no gun.
To be fair, the Microsoft situation is a little bit different. There certainly could be a gun with 235 bullets. The reason Microsoft won’t show the gun is that they have an economic disincentive to do so. If the open source community knows which patents are infringed, they can either challenge them or code around them, effectively taking away Microsoft’s weapon, and therefore MS’s ability to extort licensing payments from open source users.
What isn’t known is how many patents held by the Open Invention Network and its members Microsoft is infringing. This is one situation where the open source model is at a disadvantage: Microsoft can easily throw hundreds of lawyers at figuring out which patents open source may have infringed, while the open source community is not organized to easily do so for OIN patents that Microsoft infringes. What’s worse, open source means that Microsoft can pore through potentially offending code, while we can’t go through Microsoft’s code to document their infringements.
I have not been a fan of the Free Software Foundation, but here’s an area in which they could truly contribute, rather than writing yet another draft of GPLv3: set up an open commons project to identify patents that Microsoft may be infringing. This analysis would have to be done based on MS software’s behavior, since the code can’t be examined, but at least we would have a credible counter-claim to force Microsoft to tone down their extortion racket a bit.
And no, I don’t see this as contradictory to my generally favorable view of the Novell-Microsoft agreement. Novell has denied any implication that we acknowledge any infringement of Microsoft patents, and have been donating our patents to the OIN for the benefit of open source. This would be a complementary step to continue progress towards the ubiquity of open source and its inter-operability with Windows.
Updated below.
Many years ago, I read a book about an alternate universe where the laws of entropy are reversed. Instead of tools and artifacts deteriorating over time with use, they would improve with use. A hammer would become a better hammer the more it’s used. On the other hand, a hammer’s usefulness as a hammer would deteriorate if it was not used.
In this universe, if I wanted to make an ax, I’d get an ax-like rock, tie it to a stick, and start chopping wood. At first, my proto-ax wouldn’t be very effective, but with use it would gradually transform, getting sharper and sharper. The handle would get stronger, it’s attachment to the blade firmer, the weight distribution better balanced, all through “practicing†the ax. With enough use, I would have an extremely well-made ax, all through the backwards flow of entropy. But then if I were to leave my ax in the shed for a year and return, I would once again find a stick tied to a rock.
The novel explored the differences in behavior this reverse flow of entropy would cause. In our universe, lending our neighbor our lawn-mower is to do them a favor. In this backwards universe, if we want to do a neighbor a favor, we would borrow their lawn-mower, since we would be improving its quality by using it. If we had a table that we weren’t using, we wouldn’t store it away for future use but would instead find someone to use the table, since that would be the only way to maintain its utility as a table.
While I can’t remember the title or author of the book, I vividly recall its premise because of its complete reversal of the economics we take for granted (if anyone knows of this book, please leave a comment!). But of course this is fantasy, with no correlation to reality. Right?
Fast forward to the present. Last night I was reading The Success of Open Source by Steven Weber. A physical good is a “rival†good because if I use it, you can’t. Digital goods are “non-rivalâ€, since my use of a music or video file in no way impairs your ability to use the same good as well, since an infinite number of copies can be made at zero cost. But Weber defines a new term, “anti-rival†goods (page 154), which increase in value the more they are used. Open source software are anti-rival goods, since not only does my use of a piece of software not prevent you from using it as well, but my use of the software increases the value you receive from your use of the same software. Partly this is due to the well-known network effect, where the more people using a network, the greater the utility of the network to each participant since they are able to communicate with more people. But it’s more than that. The more users that are using a piece of open source software, the more users that will identify and report bugs, and the more users that will contribute bug fixes, enhancements and extensions. In effect, the software improves with use. Anti-rival goods reverse the flow of entropy.
In the open source community, we help our friends by using their software, and distributing it to others. If we develop a piece of code that we don’t want to maintain or extend, we are incentivized to give it away so that others will, thereby preventing its gradual decay. It is eerily like that fantasy book I read in my younger days. Our intuition developed through using, buying and selling physical goods leads us entirely astray in the open source economy where giving is receiving and receiving giving. We don’t want to acquire things that have been “gently†used, we want things that have been widely, harshly and unremittingly used. Things don’t wear out, they wear in, or up, as they improve with use. We don’t put things away to keep them new, we distribute them as widely as possible to keep them new.
The unrealistic, ridiculous fantasy universe I read about so many years ago and dismissed has become reality in the world of open source.
Update: Lance Gifford, with whom I share 50% of my genome, and who lent me the book to start with, solved the mystery. The Practice Effect by David Brin.