Thursday, May 30, 2013

Problems with Open Source

Monty Widenius wrote about the problems with the open sourcemodel, or more specifically the problems he is experiencing with his open source project MariaDB. In a nutshell, it lacks two things: (1) developers committing code; (2) users paying. He then focuses primarily on #2, lack of paying customers.

I believe that Monty’s concerns are the result of a number of factors: 

  1.  Maturity (coolness factor): When a product is new and cool, developers want to work on it and customers get in the spirit and want to pay for it to continue to evolve. But once it becomes mature…eh not so much.
  2. Maturity (downstream revenues): When a product is new and cutting-edge, “experts” make a ton of money. Look at Hadoop experts now. But as it becomes mainstream, the experts are making far less and feel less charitable toward their respective open source project.
  3. Maturity (market adoption): When you are one of the few early adopters of an open source project you may be more charitable toward the company in an effort to see it survive. Once it gains universal appeal, you figure that the rest of the people will pay so you don’t need to…in other words, “they are a success now, no need to continue funding them.”
  4. Macro Economy: If the macro economy is tight, as it is now, and companies are looking for where to cut, it is easier to cut funding to an “optional donation” than to cut one more individual. This is similar to the “downstream revenues” issue above but at the company level.

Open source projects follow a cycle, just like most everything in life. Commercial products achieve peak revenues with maturity and broad adoption. I believe that open source projects are the inverse, with maturity comes a decline in revenues. Ironically, it could well be that success is dangerous to a company's health.

Monty has some interesting ideas on separating "free" from open least to some degree.

Monday, May 6, 2013

Large Database

Just a heads-up that we have added a Large Database page on ScaleDB that talks about many of the issues facing people trying to implement a large database, such as design, backup/restore, to index or not to index, and much more. Enjoy.

Thursday, May 2, 2013

Thoughts on Xeround and Free!

Everybody loves free. It is the best marketing term one could use. Once you say “FREE” the people come running. Free makes you very popular. Whether you are a politician offering something for free, or a company providing free stuff, you gain instant popularity.

Xeround is shutting down their MySQL Database as a Service (DBaaS) because their free instances, while popular, simply did not convert into sufficient paid instances to support the company. While I am sad to see them fail, because I appreciate the hard work required to deliver database technology, this announcement was not unexpected.

My company was at Percona Live, the MySQL conference, and I had some additional conversations along these same lines. One previously closed source company announced that they were open sourcing their code, it was a very popular announcement. A keynote speaker mentioned it and the crowd clapped excitedly. Was it because they couldn’t wait to edit the code? Probably not. Was it because now the code would evolve faster? Probably not, since it is very low-level and niche oriented, and there will be few committers. No, I think it was the excitement of “free”. The company was excited about a 49X increase in web traffic, but had no idea what the impact would be on actual revenues.

I spoke with another company, also a low-level and niche product, and they have been open source from the start. I asked about their revenues, they are essentially non-existent. Bottom line is that the plan was for them to make money on services…well Percona, Pythian, SkySQL and others have the customer relationships and they scoop up all of the consulting and support revenue while this company makes bupkis. I feel for them.

I had a friend tell me that ScaleDB should open source our code to get more customers. Yes open source gets you a lot of free users…not customers. It is a hard path to sell your first 10...25…50…etc. customers, but the revenue from those customers fuels additional development and makes you a fountain of technology. Open source and free are great for getting big quickly and getting acquired, but it seems that if the acquisition doesn’t happen, then you can quickly run out of money using this model (see Xeround).

I realize that this is an unpopular position. I realize that everybody loves free. I realize that open source has additional advantages (no lock-in, rapid development, etc.), but in my opinion, open source works in only two scenarios: (1) where the absolute volume is huge, creating a funnel for conversion (e.g. Linux); (2) where you need to unseat an entrenched competitor and you have other sources of revenue (e.g. OpenStack).

I look forward to your comments. We also look forward to working with Xeround customers who are looking for another solution.