Good to the Core? -does open source software have to be fully open?

As previously mentioned in my Hats off to Red Hat – Thoughts 0n Billion-Dollar Open Source Companies post, I am working on an article for the OSBR on open source software business models.  Since my edits are due today, it was great to come across Julie Bort’s Marten Mickos says open source doesn’t have to be fully open post on her Source Seeker blog on Network World’s Open Source Subnet.

Julie begins her post with this definition and observation:

The term “open core” essentially means that the heart of a software project is built on, and remains, open source but added features may not be (particularly a commercial version intended for enterprise use).VC-funded software startups love this model.

After explaining why there is debate in the open source world surrounding this model, Julie goes on to quote extensively from Marten Mickos who was formerly the CEO of MySQL and currently the CEO of Eucalyptus Systems “which uses the open core model on its flagship private cloud application”.  While I strongly encourage you to read Julie’s excellent post in its entirety, I want to focus in on Marten’s business model related comments [for somewhat obvious reasons!]

Marten begins by noting that although the open source movement has achieved many of its goals “it still hasn’t achieved fantastic business success, except for Red Hat and MySql, what is needed is a business model, and that’s why open core is needed”.

He goes on to concede that not all open source initiatives either want or need such a business model –  “Look at Apache, the most successful open source project ever. At the same time, there’s no revenue. No revenue, no VCs, no CEO. That’s fine. They set out to achieve world domination without making money and they achieved that.”

While Julie notes that she is “not convinced that open core is the best long-term method”, she also notes that ” most of the worlds’ businesses still run their critical IT infrastructures on proprietary software”.  She then goes on to make these two key observation about the open core model:

So I can see open core as being a stepping stone in two ways. First to bring enterprises into the open source world, while still giving them all the support, features, and sense of accountability they want from their vendor.

Second, and this could be more important, as a way that older software companies can make the shift into the brave new world of open source. Open core may allow them to open chunks of their code, while keeping other bits closer to their vest.

This aligns with Marten’s comments that much of the transition is a “cultural shift” including embracing the “mistakes are A-OK”  and “failure is an option” cultural norms of open source software. Such a world feels  Good to the Core for me!