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  • Roberto Galoppini 12:05 pm on August 30, 2007 Permalink | Reply  

    Open Source Business Models: What is an Open Source Business Model? 

    Despite many articles talk about Open Source business models, and some papers describe also possible taxonomies of open source business models, none of them is analyzing in depth all components which describe the business logic of a specific firm.

    FLOSSMETRICS has assessed a list of 120 companies – resulting in the biggest empirical analysis of the business models adopted by OS firms done so far – while QualiPSo has analyzed 7 firms’ case studies. None of them has focused yet its attention on how pieces of the business fit together, eventually describing the company’s strategy, or how a specific firm differentiates itself and deals with the competition, either proprietary or FLOSS.

    not equalNot all lemons are created equal by Nan’s Pic’s

    Adopting Alex Osterwalder’s definition of business model, I tried to process the information about the “Distributing copies of an OSS product for a fee” business model“, i.e. just selling free software copies, not bundling any services such as technical support, consulting, systems integration and so on.

    The Value Proposition would be shrink-wrap open source products.

    The Customer Segment would target business customers, likely SMEs and professionals, having low bandwidth (a missprint?) and poor knowledge of OS existence.

    The Distribution Channel would definitely be a web site, too little margin for retail or worse to hire a sales team. In order to sell shrink-wrap OS products personalization it is a must, to exploit the long tail Community of Interest could play a great role.

    Chesbrough and Rosenbloom suggest to consider “Position in value network” and “Competitive Strategy”, and as matter of fact the competitors are all forges and repositories, Linux Magazines and so on.

    About the Competitive Strategy, Michael Porter identifies two types of advantages, the cost advantage and the differentiation advantage. Being difficult if not impossible to be cheaper than the competition, the only available option is serve customers’ idiosyncratic needs, I would say.

    Once identified an appropriate Differentiation Strategy, big marketing investments are needed to reach customers who don’t know open source products. Consider that if the business would ever work, competitors could easily imitate you, without spending time and effort doing software selection.

    At the end of the day, describing the business model and analyzing it helps to determine if it makes some sense, eventually ending to agree with Dana saying:

    The attempts by some to shrink-wrap open source products and sell them at the cost of packaging have, on the whole, been failures.

    Comparing business models could also be interesting. Reading “Do Some Business Models Perform better than Others? – A Study of the 1000 Largest US Firms” created a 16 different typologies of how firms differ in terms of two dimensions:

    what a company does and how they make money from doing it.

    It is worth to notice that some business models perform better than others, in particular selling the right to use assets is more profitable than selling ownership of assets.

    I am looking forward to apply these considerations within the joint research I am conducting with the FLOSSMETRICS project, may be adding a dimension or two to the “main revenue generation” and “licensing model” already included in the actual taxonomy.

    Technorati Tags: Open Source Strategies, business models, QualiPSo, FLOSSMETRICS

    • jheuristic 2:41 pm on August 31, 2007 Permalink

      Hi —

      Good post.

      “Chesbrough and Rosenbloom suggest to consider “Position in value network” —

      Have a look at Open Value Networks.



    • Roberto Galoppini 9:49 pm on August 31, 2007 Permalink

      Hi J,

      thanks for joining the conversation. I had a look at the Open Value Networks, and I read about GenIsis Value Network tool. I tried to download it, but apparently on SourceForge version 1.0 is not available.

      Did you use the tool by any chance? I see you mentioned it over kmblog, could you tell me what do you mean by this?

      Today, major social transformations like Web 2.0 and Cisco System’s The Human Network, are building new layers onto the OSI model.

    • David Meggitt 3:30 pm on October 9, 2007 Permalink


      An open source value network approach (refer again to ) to viewing a business model using Chesbrough and Rosenbloom that you cite can be seen at

      Note the inclusion of “Standards” which has no mandated contractual relationship with the other participants in the network. Nevertheless, their inclusion is key and one way in which value networks such as that containing say Cisco is made resilient.


      David Meggitt

    • Roberto Galoppini 10:40 am on October 11, 2007 Permalink


      thank you to join the conversation. As supporter and sponsor of these initiatives could you please sort out if the GenIsis Value Network tool is or not Open Source? As I wrote before I tried to download it, but on SourceForge version 1.0 is not available at the present stage.

    • David Meggitt 10:34 pm on October 12, 2007 Permalink

      Roberto…I have just had a look and the files are accessible to me, without any special log in.
      You can also see the number of downloads to date.
      I will check it out with the designer, however, if you are still having problems.

      David Meggitt

    • Roberto Galoppini 9:54 am on October 13, 2007 Permalink

      David you’re almost right..unfortunately the composer is no longer available and it became proprietary, so apparently you can download just plugins and documentation, but not the application itself. If this is the case, I could hardly call it open source. As a matter o fact Split/OSS Commercial products work just the other way around: the application is open, plugin are proprietary.

      Am I missing something David?

    • David Meggitt 9:52 am on November 30, 2007 Permalink


      You are most likely correct. The software support to engaging with value network analysis (VNA) is being IP’d, with many more features, and likely to be launched next year.

      However, the real value is not the software but the recognition that VNA offers a new perspective or “lens” with which to visualise more realistically how organisations work. The material for that is all open source, as to method. There is also an information object model published for consultation.

      A recent large scale application with some 100 personnel enabled Boeing to increase productivity by a factor of six in redesigning a new organisation – the flight test “center” for the new Dreamliner aircraft. “Composer” was not needed for that.

      Hope that helps.


    • Roberto Galoppini 2:14 pm on November 30, 2007 Permalink

      Hi David,

      for IP’d do you mean closed sourced? If this is the case I don’t see the point to pretend it to be open source.

      I am a firm believer that transparency pays, and I would see as appropriate a clear statement in the download page saying it all.

    • Marcin Jakubowski 2:41 pm on July 1, 2009 Permalink

      We are developing open business models from the grassroots perspective. However, we are well on our way to demonstrating that high quality, open source hardware (not only software) – can be produced cost-effectively according to this model. Please read our overview:

    • Giovani Spagnolo 4:13 pm on September 21, 2009 Permalink

      Ciao Roberto,

      Very nice blog posts about Open Source business models. If could be of interest, I have my (2003-2005) master/MBA thesis on “FLOSS as a business model” published on


    • Roberto Galoppini 9:45 am on September 22, 2009 Permalink

      Ciao Giovanni,

      unfortunately I’m not so fluent in Spanish, but I had a look at it and it seems interesting, let me know if you write an English version.

      By the way, say Hi to Alfonso, I met him years ago in Brussels but after that our roads didn’t cross anymore.

  • Carlo Daffara 1:51 pm on August 23, 2007 Permalink | Reply  

    Estimating the number of active and stable FLOSS projects 

    A recurring debate discussion among FLOSS-supporters and detractors is related to the estimation of the real number of active FLOSS projects. While it is easy to look at the main repository site ( that boasts more than 100.000 projects, it is equally easy to look in more depth and realize that a significant number of those projects are really abandoned or have no significant development. How many active and stable projects are really out there?

    choicesToo many cereal choices by PartsNpieces

    For the purpose of obtaining some unbiased estimates in the context of the FLOSSMETRICS project, we performed a first search among the main repository sites and FLOSS announce portals; we also set a strict activity requirement, stately an activity index from 80 to 100% and at least a file release in the last 6 months. Of the overall 155959 projects, only 10656 (6.8%) are “active” (with a somehow very restrictive definition; a more relaxed release period of 1 year shows an active percentage of 9.2% or 14455 projects).

    However, while Sourceforge can rightly be considered the largest single repository, it is not the only potential source of projects; there are many other vertical repositories, among them BerliOS, Savannah, Gna! and many others, derived both from the original version of the Sourceforge code and many more based on a rewritten version called GForge. That gives a total of 23948 projects, to which (using a sampling of 100 projects from each) we have found a similar number of active projects (between 8% and 10%).

    The next step is the estimation of how many projects of the overall FLOSS landscape are hosted on those sites, and for performing this estimate we took the entire FreshMeat announce database, as processed by the FLOSSmole project and found that the projects that have an homepage in one of the repository sites are 23% of the total. This count is however biased by the fact that the probability of a project to be announced on FreshMeat is not equal for all projects; that is, english-based and oriented towards a large audience have a much higer probability to be listed. To take this into account, we performed a search for non-english based forges, and for software that is oriented towards a very specific area, using data from past IST projects like Spirit and AMOS.

    We have found that non-english projects are underrepresented in FreshMeat in a significant way, but as the overall “business-readiness” of those projects is unclear (as for example there may be no translations available, or be specific to a single country legal environment) we have ignored them. Vertical projects are also underrepresented, especially with regard to projects in scientific and technical areas, where the probability of being included is around 10 times lower compared to other kind of software. By using the results from Spirit, a sampling from project announcements in scientific mailing lists, and some repositories for the largest or more visible projects (like the CRAN archive, that hosts libraries and packages for the R language for statistics, that hosts 1195 projects) we have reached a lower bound estimate of around 12000 “vertical” and industry-specific projects. So, we have an overall lower bound estimate of around 195000 projects, of which we can estimate that 7% are active, leading to around 13000 active projects.

    Of those, we can estimate (using data from Slashdot, FreshMeat and the largest Gforge sites) that 36% fall in the “stable” or “mature” stage, leading to a total of around 5000 projects that can be considered suitable for an SME, that is with an active community, stable and with recent releases. It should be considered that this number is a lower bound, obtained with slightly severe assumptions; just enlarging the file release period from 6 months to one year nearly doubles the number of suitable projects. Also, this estimate does not try to assess the number of projects not listed in the announcement sites (even vertical application portals); this is a deliberate action, as it would be difficult to estimate the reliability of such a measure, and because the “findability” of a project and its probability of having a sustained community participation are lower if it is difficult to find information on the project in the first place; this means that the probability of such “out of the bounds” projects would probably be not a good opportunity for SME adoption in any case. By using a slightly more relaxed definition of “stability”, with an activity rating between 60% and 100% and at least a release in the last year, we obtain around 18000 stable and mature project from which to choose- not a bad result, after all.

    Technorati Tags: open source metrics, sourceforge, flossmetrics, flossmole

    • Bill Poser 6:57 am on August 27, 2007 Permalink

      The activity criterion used underestimates the number of projects that provide useful software. A project may not have had a recent release because it is complete and has no known bugs, or no bugs significant enough to fix. Of course, it would be difficult to take this into account without a lot more work since it would be necessary to examine the status of each project.

    • Carlo Daffara 7:47 am on August 28, 2007 Permalink

      As mentioned in the text, this is meant to provide a lower bound to the number of available, active and stable projects; as such, we have chosen a very strict definition of activity, and we used the project choice of “stability”, even considering that this lowers the number of suitable projects even more (there are many “beta” projects that are really stable). We already have found projects that are stable but not included in the count; an example is GNU make (that is stable, but having no new release in one year would not make it to the list).
      It must be considered, however, that even projects that are more or less finished (no more bugs) may need a small recompile or modification to adapt to changing platforms and environments; in this sense, stable project with no release in one year should be considered an exception and not the rule. Using a simple sampling approach, we estimate that those are less than 2% of our original count, and so we would not rise the package count in a significant way. Our main objective was to demonstrate that the lower bound of the number of both stable and maintained packages was significant, and I believe that that result was reached.
      Many thanks for your comment (and for reading the article thoroughly :-))

    • Nathan 9:24 pm on October 22, 2007 Permalink

      It would be very interesting to see that list of 18,000 stable, mature, active projects. Any plans to publish it?

    • Carlo Daffara 10:19 pm on October 29, 2007 Permalink

      For some of the forge sites that allows for data extraction, such a list can be obtained through the FLOSSMOLE data source. For those sites that have no search functionality, or that provide only part of their database in a searchable way, statistical methods were using based on a sampling approach, and in this case no list (just the numbers) can be obtained. It is important to understand that what we were looking at was a lower bound on the number of active and stable projects, not a “final” list.

    • Ali 4:43 pm on October 25, 2012 Permalink

      I am doing currently a research on open source firm. for statistical model i need number of projects registered to sourceforge year by year, is there any way to extract these information from sourceforge?

    • Roberto Galoppini 3:52 pm on October 27, 2012 Permalink

      Sure, look at the SourceForge Research Data at the Notre Dame University.

  • Roberto Galoppini 5:39 am on July 31, 2007 Permalink | Reply  

    Open Source Wiki: a chat with Ludovic Dubost, Xwiki CEO 

    Xwiki, a French company aimed to bring open source wiki to the enterprise, recently won the i-Expo Prize for Economic Intelligence at the i-Expo 2007 show in Paris for XWiki Watch.

    Ludovic Dubost Ludovic Dubost by rsepulveda

    I happened to know about Xwiki few moths ago reading that at ENST were having two internship proposals to work on XWiki, later I got in touch with Luis Arias and since then we occasionally exchange opinions and ideas about Open Source business models.
    Yesterday I had a conversation with Ludovic Dubost, Xwiki CEO, and we start speaking about how Wikis in general are getting more an more interest and attention, despite Knowledge Management and Collaboration tools are not on the food chain.

    Then I asked Ludovic about XWiki Watch.

    XWiki Watch concerns an activity which is well defined in the enterprise. monitoring what competitors do, how your company is perceived, how much press is received.. The concept is not new, it’s just Internet opened new opportunities.
    I mean, the Wiki is already perceived as a way to record knowledge about the competition, but only manually before XWiki Watch.

    Why should I use Xwiki Watch?

    With XWiki Watch you can mix retrieving info from the Internet, flag it, comment it but also write your own info, create wiki pages about the subjects you are watching and you can construct a knowledge base (wiki style) which will the connected to the internet info

    We are also planning to have delivery as a web site or in a blog, in addition to the delivery as mail, pdf, and RSS feed.

    The big differentiator versus RSS aggregators is the delivery tools, while the big differentiator versus existing Competitive intelligence tools is the collaborative aspects (flags/comments) and the Wiki integration.

    In XWiki Watch once the different users select the best news and comment them, and tags them, once you have done this you can construct a filter and ask for a specific delivery. So the filter could specify that you want only the flagged articles and specifying that you want them by email, or PDF, or on a web page, or a news RSS feed.

    Actually XWiki Watch doesn’t collect news from source that are not RSS enables, as tools like MySyndicaat (actually not Open Source but a great tool to do newsmastering), but they eventually could do some custom coding. After all their business model is a mix of Products specialists and Split OSS/commercial Product. FLOSSMETRICS taxonomy describes Product specialists companies that created (or maintains) a software project, and use a pure FLOSS license to distribute it, and the main revenues come from services like training and consulting. But XWiki it is also adopting the Split OSS/Commercial product business model, selling XWiki Enterprise edition, and I guess they will soon expand their offer in this respect.

    Can you tell me why Xwiki Watch won the prize?

    We were in a conference about Competitive Intelligence, and XWiki Watch won the innovation prize. The main reason for the prize was because of the ability for XWiki Watch to “democratize” Competitive intelligence. As a matter of most organization tend hire a person to do that and deliver info to the management or to the company, with XWiki Watch you can decide to organize things differently, like everybody in the company becomes a Watcher and everybody gets the most interesting info delivered. While actually if you look at it precisely you’ll see that everybody is doing watching on his space, it’s just not shared.

    While firms like Wikispaces are mainly working with on-line collaboration and open source industries, XWiki apparently is differentiating its offer going further than the wiki, targeting collaborative tools, project management and collaborative watching. In order to do that they are through partnerships with other players, like Nearbee, CHRONOPOLYS.

    Thank you Ludovic, and happy hacking!

    About XWiki.
    XWiki is an open source Wiki, and it is also an Enterprise wiki which allows the creation of applications within the Wiki interface. The languages that can be used are Velocity and Groovy, it is written in Java and it uses database like MySql or HSQLDB.

    Technorati Tags: XWiki, Xwiki Watch, LudovicDubost, Business models

  • Carlo Daffara 7:45 am on July 25, 2007 Permalink | Reply  

    Open Source Business Models: Joint Research Announcement 

    I am extremely happy to announce the start of a new joint research activity between the FLOSSMETRICS project and Roberto Galoppini, one of the most important European researchers working on FLOSS-based business models. The joint research work will be carried with Carlo Daffara and will be centered on business models taxonomies, and how the participant actors (like the FOSS communities, commercial companies, individual developers) and the licensing choices interact in a commercial exploitation context. The research will leverage the tools and research work carried in the European project for analyzing OSS project participation and contributions, and as for all of FLOSSMETRICS will be publicly avaliable.

    Technorati Tags: Commercial Open Source, Open Source Strategies, FLOSSMETRICS, robertogaloppini, carlodaffara, taxonomies

    • Savio Rodrigues 2:03 pm on July 25, 2007 Permalink

      Congrats Roberto! Look forward to seeing results from the research. Will you be studying the use of OSS by Traditional software vendors (like IBM, Oracle, Sun) to drive their Traditional software revenues?


    • Carlo Daffara 7:37 am on July 26, 2007 Permalink

      Dear Savio,
      yes, the study on how OSS models are used in traditional commercial software companies is one of the aspect of our research. We expect to produce in the end a set of papers helping companies assess existing OSS projects and how to compare the potentially applicable business models to decide the most appropriate one. We hope to turn the results of what is basically software engineering research (as FLOSSMETRICS is) into a more concrete and helpful tool for companies interested in OSS.

  • Carlo Daffara 3:38 pm on May 29, 2007 Permalink | Reply  

    Open Source Firms: What is an OS company, anyway? 

    A recurring theme of discussion is exactly what defines an “OS company”. Many potential customers are finding more and more difficult to distinguish between “real” open source, viewable code licenses, quasi-open and more; companies are trying to leverage the opportunity of the OS market to push an offering, even if it is not OSS at all.

    Recursion Recursion by gadl

    Of course, a company like Alfresco can proudly claim that – being its main offering a pure GPL software – they are OS, libre, and whatever. But what exactly makes a company an open one?
    It is not difficult to find previous traces of the same argument before; starting from Mark Shuttleworth’s comments, Aitken’s ones or by Savio Rodrigues. Within the FLOSSMETRICS project we are facing the same problem, that is how to assess the “openness” of a company, and we observed a few things:

    • an OSS project is not only about code; in fact, in many projects the amount of non-code assets (like documentation, translations, ancillary digital material) is substantial. Considering companies as open only by measuring code patches is reductive;
    • a company may sponsor a project in many ways. For example, granting hired programmers time to work on OSS projects (during work hours) is an indirect monetary sponsoring activity; hiring main developers and giving them flexibility to continue develop OSS code is a direct sponsoring.

    There are relatively few examples of the first kind; among them, companies that localize and create country-specific versions (like the italian accounting scheme for the Adempiere ERP created by Anthas to allow for a simpler commercialization.

    The second model is quite common: IBM sponsors development of the Apache web server, as a basis of its Websphere product, Google employees are asked to work for an OSS projects one day per week on company time (and sponsoring the summer of code, by the way), EnterpriseDB pays many PostgreSQL developers.

    Given this, we ended up classifying OS firms as those that:

    • sponsor, support, facilitate an open source project, that is a project that has a license compatible with the OSD definition, in a direct or indirect way.
    • the sponsoring/support must be continuous, that is it should not be a single, one time contribution.

    This allows to include only those companies that leverage OSS in an organic and structural way, or they would not be able to justify the investment over an extensive period of time.

    This excludes one-time donations, for example; and it also excludes those companies that just take OSS and resell it packaged without added value, or “dump” a worthless software code under an OSS license hoping that someone willtake it up from there.

    Technorati Tags: adempiere, alfresco, anthas, Commercial Open Source, Open Source Firm

    • Savio Rodrigues 6:22 am on May 31, 2007 Permalink

      I agree Roberto, defining an OSS company is difficult and going to get increasingly so as more companies add OSS into their software strategy.

      Something that I’ve been thinking about since OSBC, which relates to your post…

      We’ve all heard about how open source Google uses to run their business. We also know that Google pays (some of their) employees to work on OSS projects as part of their day jobs. But what of all the OSS changes that Google makes and does not contribute back to the community? Does that make Google a ‘bad’ OSS company? How can they be ‘bad’ when they’re using OSS in a way that the OSS license allows??? But really, we all know that Google can’t be bad/evil, right 🙂

    • Roberto Galoppini 11:53 am on May 31, 2007 Permalink

      @Stefano Maffulli: Stefano I couldn’t manage to comment your post (may be is it great time to become a FSFE Fellow in order to? ;-), so I am writing you here for the time being. Mission and CSR might help, but my guess is that it is more effective to judge firms by their actions, even if requires some effort.

      @Open Source Solutions: I guested Carlo’s post even if I previously took a completely different position on the matter, and now I am seriously wondering about it all.

      @Savio: you are raising the same point I early discussed with Carlo, amazing! 😉 We all know Google is taking advantage of the GPL loophole, but it is also true that is contributing to many projects, and we can’t also forget the Google Summer of code.

      I think we should start creating categories reflecting the corporate-community relationship, and also the “old” Externally funded”/ “Internally funded” models. But all these (complex) distinctions might bring more confusion than clarity, I am afraid.

  • Roberto Galoppini 7:32 pm on May 16, 2007 Permalink | Reply  

    Open Source Business models: to be or not to be community-driven 

    While Seth Grimes was in Rome we took a chance to have a nice chat talking of open source business models, and we happened to discuss about differences between proprietary and open source business models.

    How old is your community? by Insane Zamboni

    Characterizing Open as Altruistic and Closed as Profit-driven is, agreed, too black-and-white to explain the many businesses that seek to profit from open source. But on reflection, I like my table as-is. Open-source businesses are universally hybrids, whether they seek to profit from their altruism – those companies such as CentricCRM and Pentaho that sell support for software offerings that are completely free, open source – versus those such as SugarCRM and JasperSoft that are altruistic only to the point where they can attract paying customers for the closed parts of their software stacks. Open-source businesses span the table columns. Whether Open or Closed predominates in a given case depends on the particular business model.

    Reading Seth’s back thoughts on what characterizes open and closed business models, I got back to the idea that classifying Open Source production models is not a mere academic curiosity. On the contrary it makes a lot of sense, since it affects at large the software life-cycle.

    Corporate Open Source

    Hybrid Open Source


    An Open Source firm

    A multi-stakeholder entity

    Product development

    Driven by corporate economics

    Driven by product functionality


    Limited numbers, all employed by the supplier, not reachable from outside the organization.

    Varies from a small to very large group of developers. Often permanently employed by the original author or other firms, volunteers or sponsored.


    Commonly not organised, every user maintains – if any – direct contact with the supplier independently from other users.

    Users participate in virtual communities and discuss among themselves and with the developers about the product, potentially influencing its development.

    The original version (edited) was extracted by the Open Source Maturity Model document

    While I can’t agree with Dion Almaer that if a company open sources its software it is a token gesture, I believe he raised some very important issues, describing what he meant for community driven open source – or hybrid production model, in my words.

    If you don’t have any committers from outside of your company. You probably aren’t community driven.

    If you didn’t spend time cleaning up documentation for the community when you opened it up. You probably aren’t community driven.

    If your users haven’t helped with the documentation if it is lacking. You probably aren’t community driven.

    If you do not have some kind of forums/lists where people help each other out. You probably aren’t community driven.

    If you aren’t willing to put in a lot of effort to build your community to get true benefits. You probably aren’t community driven.

    I don’t think an Open Source firm has to fulfill all of these requirements to proudly call itself community-driven, but if they can’t positively answer any of them I doubt they are taking part of a so-called community.

    I warmly suggested Carlo Daffara to take into consideration also this aspect when describing open source business models within FLOSSMETRICS.

    Is your Open Source Firm different?

    Technorati Tags: Commercial Open Source, community-driven, flossmetrics, grimes, almaer

    • Chris Marino 1:18 pm on May 17, 2007 Permalink

      Tony Wasserman at CMU West has done some research into this and has developed a framework for organizing the different methodologies.

    • Dominic Sartorio 2:16 am on May 18, 2007 Permalink

      Thanks for raising this excellent topic. At the OSA (Open Solutions Alliance), we have a diverse membership and are often asked what we consider to be “open” business models. So, we track this issue with great interest.

      Inevitably, discussion goes down the path of licensing, or how strong each member’s community it. What isn’t discussed enough, IMO, is what best meets customer needs. Ultimately that should determine which business models are best. Unfortunately, there’s no simple answer. Customer requirements can vary greatly, depending on industry, their IT best practices, the type of solution in question, and the skills and know-how required to implement it. Companies that serve different market segments must evolve their business models to best meet the requirements of that segment. Some may be more services-intensive, requiring frequent code customization for example, while others aren’t necessarily best served by purely OSD-compliant management and licensing of source code, but benefit from “open-ness” in other ways. Because open source, especially in the applications space, is still relatively new, we think there is much room for experimentation regarding what business models are best for the most customers. Consequently, we don’t limit our membership based on some preconceived notion of business models we think ought to be the best. Let customers decide that, not us.

      However, there is one notion that we don’t compromise. There’s a difference between “old guard” proprietary organizations and more open, collaborative organizations. The former hoard know-how, act unilaterally, and are always trying to “manage” how customers and partners perceive their products and solutions, as if yielding as little real information as possible is the key to business success. The latter instead share know-how, and act collaboratively with their customers and within their industry, and they compete based on their ability to make customers successful. We fundamentally believe that open and collaborative behavior is consistently superior to closed and unilateral behavior. This difference go beyond how the source code is managed, to how the company fundamentally operates; How it engages with its customers and partners, its corporate marketing, and even corporate culture and internal politics. A company’s DNA is either one or the other; these don’t mix.

      This is hard to quantify, but you know it when you see it when interacting with the management. There are some typical markers… GPL-licensing is a good sign. So is having public forums for customer feedback. (A closed company would never want the rest of the world to see an unfiltered view of what its customers think about its products.) But there are multiple ways a company can operate and still be “open”.

      Your thoughts are welcome. I’m not sure it’s possible to form a comprehensive taxonomy of open business models, but that doesn’t mean we shouldn’t try.

    • Roberto Galoppini 8:53 pm on May 18, 2007 Permalink


      I have been a strong advocate for the Open Source Maturity Model, and I thought that the Business Readiness Rating could be considered its evolution.

      None of them became a standard yet, before them even the GRAM/GRAS list had not much success indeed.

      Apparently consultants did not succeed by these means in producing definitive answers on which open source software is best suited to cover a particular need. Why? Once again one size doesn’t fit all.

    • Roberto Galoppini 5:48 pm on May 20, 2007 Permalink


      I appreciated very much that you came over to comment my post and I am glad you at the Open Solutions Alliance are taking seriously this issue.

      While how strong each member’s community is, it is partially due to members’ choices, licensing on the contrary is totally under their control.

      I wrote about “false positive” talking about OSA’s decision to accept members not using open source licenses.

      You are right saying that there is room for experimentation regarding what business models are best, but pretending to sell open source while selling proprietary software is misleading.

      If you don’t compromise (only) on the degree of openness

      We fundamentally believe that open and collaborative behavior is consistently superior to closed and unilateral behavior. This difference go beyond how the source code is managed, to how the company fundamentally operates; How it engages with its customers and partners, its corporate marketing, and even corporate culture and internal politics.

      you should be clear about it, and tell everyone OSA has decided not to talk about open source (while not it is even under the logo, reporting “open source at work”). Then you might consider to make some changes to your website, that says:

      From time to time, the OSA may use the term “open source solutions” or “open source based solutions.” We do not mean to confuse this with the OSI’s Open Source Definition, which includes requirements not included in our open solution definition.

      This way OSA is contributing to make open source definition uncertain, don’t you agree?

      Your opinion is always welcome.

    • Dominic Sartorio 11:24 pm on May 20, 2007 Permalink

      Hi Roberto, Thanks for your thoughtful reply. Yes, we had our own “false start” through sloppy use of the term “open source” when we originally launched last winter. Open Source (capital ‘O’, capital ‘S’) means something very specific, as defined by the OSI, and the OSA intends to cover broader ground, for the reasons I described in my previous post. Our collective experience has been that customer value can be achieved in a variety of ways, and some of them don’t always fit a strict definition.

      You found other parts of our website that we overlooked. Thanks for finding this, and we will fix this. We don’t intend to cause further ambiguity around what it means to be “open source”, but rather clarify an issue that we believe hasn’t received enough attention: focus on customer needs. In an effort to avoid confusion, we came up with our own term, “Open Solution Definition”.

      Rest assured that our continuing work on this issue will be done in fully open and collaborative ways. Just like open and collaborative development has led to great Open Source products, we believe that open collaboration by the vendor community on various business issues is the best way to achieve customer success.

      Many vendors are incapable of this behavior. Some grew during the pre-WWW time when business success depended on unilateral behavior and “knowledge hoarding” than the collaborative behaviors that modern technologies now enable. Take a look at a more recent blog re: the Microsoft patent issue as an example.

  • Roberto Galoppini 6:00 pm on May 3, 2007 Permalink | Reply  

    European Open Source Projects: transparency pays 

    European Community is known to finance many projects regarding Open Source Software, and it would be interesting to know more about such public spending.

    Few days ago Alberto Sillitti, from the university of Bozen, one of the Qualipso members, asked me to join a Qualipso’s workshop that will be held in Limerick, within the Third International Conference on Open Source Systems. He kindly asked me to join the meeting to bring over my thinking, and to get myself prepared I went through their website and other projects’ websites.

    I enjoyed the FLOSSMetrics approach, fully disclosing their description of work (PDF), stripped only from some confidential information. Reading their document (53 pages long) I found all possible details about the project, including the project management and exploitation/dissemination plan and the detailed Workplan.


    Kudos to FLOSSMetrics to choose transparency, but it is worth to notice that many other projects did the same, checkout yourself searching IST Projects “Description of work”.

    My first suggestion to Qualipso: made public your description of work, transparency pays.

    Technorati Tags: IST, Qualipso, FLOSSMetrics, Open Source

  • Carlo Daffara 2:03 pm on April 6, 2007 Permalink | Reply  

    Open Source Business Models: a Taxonomy of Open Source Firms’ business models 

    Within the context of the FLOSSMETRICS project we are performing a study on the business models adopted by companies that are leveraging FLOSS source code, and how the model changes with respect of licenses and commercialization approaches.In this post I present a draft of the result of 80 FLOSS-based companies and business models, conducted using only publicly available data. Feedbacks and suggestions are welcome!

    taxonomyPractical taxonomy by ellen’s attic


    An initial list of 120 companies was prepared during the first two month of 2007 using some popular open source news websites as source like FreshMeat,, OSNews, LinuxToday, NewsForge and some blog sites devoted to FLOSS business models like those of Matt Asay, Fabrizio Capobianco, Roberto Galoppini. Additional information was retrieved from Google searches. this list was further refined by eliminating companies that were not really adopting FLOSS, even using a very relaxed definition. In the specific, any company that allowed source code access only to non-commercial users, or that did not allowed for redistribution was dropped from the list; also, companies for which no information was available, or for which no clear product or service was identifiable was equally eliminated. One of the companies included (Sourceforge, from the OSTG group) is not open source in itself, but represents an example of an “ancillary” model, as the site itself hosts more than 100000 open source projects and provides supporting services like mailing lists, source code versioning systems and file distribution. Also, companies that have a significant OSS contribution, but for which FLOSS is not the core business model were not included (this for example includes IBM, HP and Sun; all of which are important FLOSS contributors, but for which open source software is just one of the overall revenue streams).


    The final result is summarized in a table (pdf), the 6 main clusters identified are:

    Twin licensing: the same software code distributed under the GPL and a commercial license. This model is mainly used by producers of developer-oriented tools and software, and works thanks to the strong coupling clause of the GPL, that requires derivative works or software directly linked to be covered under the same license. Companies not willing to release their own software under the GPL can buy a commercial license that is in a sense an exception to the binding clause; by those that value the “free as in speech” idea of free/libre software this is seen as a good compromise between helping those that abide to the GPL and receive the software for free (and make their software available as FLOSS) and benefiting through the commercial license for those that want to maintain the code proprietary. The downside of twin licensing is that external contributors must accept the same licensing regime, and this has been shown to reduce the volume of external contributions (that becomes mainly limited to bug fixes and small additions).

    Split OSS/commercial products: this model distinguish between a basic FLOSS software and a commercial version, based on the libre one but with the addition of proprietary plugins. Most companies adopt as license the Mozilla Public License, as it allows explicitly this form of intermixing, and allows for much greater participation from external contributions, as no acceptance of double licensing is required. The model has the intrinsic downside that the FLOSS product must be valuable to be attractive for the users, but must also be not complete enough to prevent competition with the commercial one. This balance is difficult to achieve and maintain over time; also, if the software is of large interest, developers may try to complete the missing functionality in a purely open source way, thus reducing the attractiveness of the commercial version.

    Badgeware: a recent reinvention/extension of a previous license constraint, that is usually based on the Mozilla Public License with the addition of a “visibility constraint”, the non-removability of visible trademarks or elements from a user interface. This allows the company to leverage trademark protection, and allows the original developers to receive recognition even if the software is resold through independent resellers.

    Product specialists: companies that created, or maintain a specific software project, and use a pure FLOSS license to distribute it. The main revenues are provided from services like training and consulting (the “ITSC” class) and follow the original “best code here” and “best knowledge here” of the original EUWG classification. It leverages the assumption, commonly held, that the most knowledgeable experts on a software are those that have developed it, and this way can provide services with a limited marketing effort, by leveraging the free redistribution of the code. The downside of the model is that there is a limited barrier of entry for potential competitors, as the only investment that is needed is in the acquisition of specific skills and expertise on the software itself.

    Platform providers: companies that provide selection, support, integration and services on a set of projects, collectively forming a tested and verified platform. In this sense, even linux distributions were classified as platforms; the interesting observation is that those distributions are licensed for a significant part under pure FLOSS licenses to maximize external contributions, and leverage copyright protection to prevent outright copying but not “cloning” (the removal of copyrighted material like logos and trademark to create a new product). The main value proposition comes in the form of guaranteed quality, stability and reliability, and the certainty of support for business critical applications.

    Selection/consulting companies: companies in this class are not strictly developers, but provide consulting and selection/evaluation services on a wide range of project, in a way that is close to the analyst role. These companies tend to have very limited impact on the FLOSS communities, as the evaluation results and the evaluation process are usually a proprietary asset.

    The remaining companies are in too limited number to allow for any extrapolation, but do show that non-trivial business model may be found on ancillary markets. For example, the Mozilla foundation obtains a non trivial amount of money from a search engine partnership with Google (an estimated 72M$ in 2006), while SourceForge/OSTG receives the majority of revenues from ecommerce sales of the affiliate ThinkGeek site.

    Technorati Tags: , ,

    • Seth Grimes 6:53 pm on May 18, 2007 Permalink


      Looking at

      – I believe that EnterpriseDB does not provide ANY OSS. They sell only closed-source extensions to PostgreSQL.

      – Given that you have SugarCRM, why not also list CentricCRM, which provides a good contrast?

      – And given Pentaho & JasperSoft, how about SpagoBI or all of Spago?

      – If your going to list Red Hat, then you should list Novell rather than SuSE Linux.

      – I’d suggest that “dual licensing” is a better term than “twin licensing.”



    • Carlo Daffara 2:15 pm on May 21, 2007 Permalink

      Seth: many thanks for your comments. On EnterpriseDB, the reason for inclusion is related to how we evaluate “open source” companies; that is, if the company sponsors in a direct or indirect way an open source project that is the basis of his work, then we consider the company to be a “marginal” open source one. The inclusion of EnterpriseDB is related to the direct funding of most of postgresql developers, through employing. In this sense, while not directly “selling” an open source version of postgresql, they are creating a market model that is similar to the split oss/commercial ones.
      On Novell/Suse you are right; the longer title was “novell Suse linux” to distinguish from the other novell activities, and simply got cropped.
      CentricCRM is simply not open source at all; the license explicitly states that “You may not redistribute the code, and you may not sublicense copies or
      derivatives of the code, either as software or as a service.” and as such it clearly is not meeting the definition of open source software.
      As for SpagoBI, Engineering seems at the moment mainly touching the waters with his OSS offer; I will wait a little bit to see if I can obtain balance sheet data on how much is obtained through OSS offers.

    • James Dixon 4:21 am on May 22, 2007 Permalink

      That is a lot of research.

      If you are interested I have developed a model to describe the open source model used by companies that write the majority of the code (JBoss, MySQL, Alfresco, Pentaho, SugarCRM etc).

      James Dixon
      Chief Geek / CTO Pentaho

    • Martin 6:19 pm on May 31, 2007 Permalink

      James… I love the beekeeper analogy. The paper has helped to crystalise my own thoughts on successful software projects.

    • Roberto Galoppini 6:53 pm on May 31, 2007 Permalink

      Hi Martin,

      I also enjoyed the metaphor, really amusing.
      Quoting your comment about your attention:

      But one observation really got my attention. In POSS projects (or even FLOSS projects), the end user (/customer) is engaged at a much earlier stage in the process, thereby ensuring that design defects and unexpected use cases are brought to surface before it is too late.

      I don’t believe that is typical of FLOSS listening to users, Microsoft and many other proprietary vendors do listen too, sometimes even more than some OS firms (just have a look at many OS products’ forums, you’ll sort it out by yourself!).

      OS applications’ ecosystems? May be, but they can be effective only under certain circumstances, definitely not an easy game to play, though.

  • Roberto Galoppini 6:50 pm on March 17, 2007 Permalink | Reply  

    European Open Source Projects: pay once should be enough 

    European Community is now financing 6 different projects within the 6th Framework program related to FLOSS metrics and quality. As a matter of fact CALIBRE(mentioned) EDOS (mentioned), FLOSSMetrics (mentioned few times), FLOSSWorld, QualiPSo, QUALOS and SQO-OSS are somehow overlapping:


    Complete waste of energy by rooreynolds

    CALIBRE aims to coordinate te study of the characteristics of open source software projets, products and processes, distributed development, and agile methods.

    EDOS – The project aims to study and solve problems associated with the production, management and distribution of open source software packages.

    FLOSSWorld – It is expected that FLOSSWorld will enhance Europe’s leading role in research in the area of FLOSS and strongly embed Europe in a global network of researchers and policy makers, and the business, higher education and developer communities. FLOSSWorld will enhance the level of global awareness related to FLOSS development and industry, human capacity building, standards and interoperability and e-government issues in the geographical regions covered by the consortium.
    QUALOSS objectives:

    • Build the QUALOSS methode, an objective method to assess the robusteness and evolvability of open source software
    • Develop the QUALOSS platform, a tool to automate most activities when applying the QUALOSS methos
    • Validate the QUALOSS empirically on at least 50 open source projects

    SQO-OSS – The project is developing a comprehensive suite of software quality assessment tools. These tools will enable the objective analysis and benchmarking of Open Source software. SQO-OSS aims to assist European software developers in improving the quality of their code, and to remove one of the key barriers to entry for Open Source software by providing scientific proof of its quality.

    Many of these projects are collecting data from public open source repositories, some are working with thousands projects while others are focused on a tiny fraction of. Though all of them are supposed to collaborate with other projects investigating the same area, apparently they have no specific funds dedicated to coordination of tasks.

    On the other hand collection, aggregation and correlation of data fetched by public repository is getting everyday more important both for Public Administrations and firms. The analysis is more and more complex and it is really a waste of resources to let projects overlap.

    By the way looking for posts about European financed projects I happened to read the following posts. The first is from the Open Source Weblog (Matthew Aslett):

    While it is not altogether clear what QualiPSo will deliver that the various existing open source promotion activities and consortia are not, it will be interesting to see the results of the CMM-related project for assessing software quality.

    Other areas, such as the plan to “define a coherent family of open source software licenses” would appear to step on the toes of the OSI just a little bit.

    The second, still talking about Qualipso, is from Glyn Moody:

    Developing a new Capability Maturity Model-like approach to assessing the quality of OSS. This model will be discussed with CMM’s originators, the Software Engineering Institute (SEI), with a view to formalising it as an official extension of CMMI.

    What? Maturity? What’s this got to do with getting people to use the ruddy stuff?
    QualiPSo is launched in synergy with Europe’s technology initiatives such as NESSI and Artemis, and will leverage Europe’s existing OSS initiatives such as EDOS, FLOSSWorld (, tOSSad ( and others. The project will also leverage large OSS communities such as OW2 and Morfeo.

    Oh, now I see: all this is just an excuse for more acronym madness. So it’s basically just a waste of money, and a missed opportunity to do something practical.

    But wait:

    QualiPSo is the ever largest Open Source initiative funded by the EC.

    OK, make that the biggest waste of money, and biggest missed opportunity yet.

    I’m definitely not a fan of the Public funded “business” model, but as Italian and European citizen I can’t be happy I am not alone. I really want to make a wish now: no more random public funded projects, please.

    Technorati Tags: commercial open source, research, public funded, qualipso, flossmetrics, edos

    • Flavia 6:59 pm on March 17, 2007 Permalink

      Your post it is a kind of “mental floss”, a tentative to bring some light in the matter.

    • gaidin 10:41 am on March 22, 2007 Permalink

      I have had a presentation of all the projects you mentionned at the beginning, and except EDOS, I’ve had the same feeling as yours : they are overlapping, and aren’t going to produce anything beside reports.
      Qualipso seems a little different, though.
      I must say, the weight of the industrial partners in those projects makes the topic of interests very far from what we consider “useful”, as “we” are more interested in improving the code base rather than making money, nor are we fighting a stupid US vs EC economic war.
      Also, most Free Software Communities, that are not political conglomerates, have no voice to be heard. That discards in a very effective way any useful idea.

      I think the only good funding for actual useful Free Software comes from Google’s Summer of code.

    • Roberto Galoppini 11:29 am on March 22, 2007 Permalink

      I see your point Gaidin, and that is what I am concerned about: how is it possible that EC keeps accepting overlapping projects?
      My suspect, and I am not alone here, is that EC is lacking of skilled evaluators, turning in random results, as its best.
      I do know evaluators that recommended me to apply just for this reason. I applied twice but I have never got a single answer.
      But the pie is getting bigger and bigger, and firms are not staying at the window, of course.

      You mentioned firms’ dimension as an issue, and you might be right in this respect. EC recognizing that “Europe is good for SMEs and SMEs are good for Europe” is trying to make public calls for tender more accessible for small companies.

      If a company, or individual, finds that EU laws, and the rules of the single market, are not being properly put into practice or interpreted by public authorities, entrepreneurs can find a solution by contacting the Commission’s online SOLVIT service

      By the way you cited Google Summers’ of code, and I agree is a good example but.. while Google is a big company, they are not begging money from the State, and it makes a huge difference to me..

    • gaidin 4:00 pm on March 22, 2007 Permalink

      About Google, the whole situation of fearing an american centric domination through what google is trying to do with the summer of code or the Library, reminds me of a joke that was circulated by email.

      A kind woman from Human Ressources decided to celebrate christmas at work by giving a special meal to the employees, and a $30 voucher each. Soon, she received a complain from the non-christian employees who requested their respective holiday to be celebrated as well. Next came all the vegetarians, claiming that they were being set aside from the rest of the company because of the meat-happy special meal.
      And finally, the Unions kicked in, claiming that the voucher was utterly unequal, that it should be increased for larger families ; and rather than vouchers, the fund should be better used towards a nursery for everyone instead.

      The story ends with her having a nervous break-down.

    • Roberto Galoppini 4:18 pm on March 22, 2007 Permalink

      Well, I like the story, you admit slightly off-topic indeed, and I believe that Summer of Code is definitely a good thing. We can’t say Google is running an open source business model, though, but it is contributing a lot, and that is definitely a good thing.

  • Roberto Galoppini 12:37 pm on March 12, 2007 Permalink | Reply  

    Italian Open Source Researchers: Carlo Daffara 

    Carlo Daffara is the Italian representative of the European Woking Group on Libre software, he worked in 7 EU research projects related to FLOSS, including one of the largest migration experiment for European Public Administration (COSPA).
    I asked Carlo to join the conversation to tell us more about Open Source and Research.

    How did you start your activities as ICT researcher within EU funded projects?

    My first Commission activity was with the EU WG on Libre Software, where we [Barahona and I] prepared an article on the economic potential of FLOSS. It had quite an impact, and was also used as basis for many legislative actions and other research activities. I then started working in EU research projects related to OSS; the first one was SPIRIT, for open source in health care, where we prepared one of the first European sourceforge clones. Another influential one was COSPA, where we studied the real TCO/ROI of a migration to open source software on the desktop of European Public Administrations.

    Few weeks ago I asked Alessandro Rubini his opinion about “the” community, and as you might know he is quite skeptical about.
    What is your opinion about “the” community?

    Alessandro is right in expressing disbelief in a generic “community”; there are organized communities that can be recognized as such (Debian or Gentoo supporters are among them) but tend to be an exception and not the rule. Most software do not have a real community outside of the developers (and eventually some users) of a single company; it takes a significant effort to create an external support pyramid (core contributors, marginal contributors, lead users) that adds value. If that happens, like in Linux, or the ObjectWeb consortium the external contributions can be of significant value; we observed even in very specialized projects a minimum of 20% of project value from external contributors.

    It is worth to notice that both Carlo and I use the “pyramid” expression. While he is more focused on the contribution side, I used the expression to layer the market talking about Funambol business model with its CEO Fabrizio Capobianco. Funambol addresses users’ needs depending on their level up the value chain, where “free” customers are at the bottom of the pyramid and Carriers at the top – ISV, Wireless Manufacturer and Application/Internet Service Providers somewhere in the middle. Please note that now Funambol is available in two editions (used to be three), a sign that they are keeping moving and refining their business model.

    You stated that at least 20% of project value come from external contributions, I guess this information come from early FLOSSMetrics results. What about the project?

    FLOSSMETRICS is aiming at the creation of a set of tools and a comprehensive database of metrics related to open source projects, in a verified and stable way. It is planned that this will help future research on the software engineering aspects of OSS, and on the interaction of coding, non-code related activities, and social interactions.
    Our area of work is related on the sustainability of open source-based business models, extending the work we have done in the past 5 years in SPIRIT, COSPA and other projects. We will leverage the database of code to find how communities can find sustainable development models, how business can cooperate or start an OSS project in a sustainable way.

    Talking about business models, you are working from years on taxonomies and categorizations, would you tell us what is an Open Source firm in your opinion?

    My opinion is that code licensing cannot be the only important parameter; for example, a company that pays developers, during work hours, to work on open source projects does indeed benefit OSS in general, and should probably be considered as such. In this view, Google can be considered an OSS company even if it does not release much code under OSS licenses.
    It is important to consider that while it is understandable that claiming to be OSS when it is not true is negative for the market as a whole, the strong tension that is actually developing while debating OSSness is due to business reasons, as new entrants are trying to find a niche market (in some cases “faking” OSS capabilities) and OSS incumbents that are trying to magnify their “truer” OSSness for signaling reasons.

    Here you are bringing some salts to the discussion, I will soon come back on this, may be asking you more on the subject.

    Talking about public funded projects, me and not just me have been quite critical of some European funded initiatives. Do you see any problem in this respect?

    The problem with some EU projects is that they are not really “open”, in terms of external suggestions, interactions, criticisms and such. Some projects “blended” very well with development communities, like EDOS, by having a dedicated person that interacts with groups, companies and communities in a structured way; I would expect that any “open source” project should have at least this kind of openness.

    I totally agree. I think such approach should be used just everytime a significant IT public budget is allocated, it could be a very effective audit. I would also like to see EC evaluators be proficient with Open Source, and I know from my experience that applying is pointless if you are not in their know.

    I am not convinced that there is a need for public funded OS projects, nevertheless I am in favour of public funding in presence of a clear market failure. Do you?

    The problem is twofold: first of all, it is important to recognize the market failure, and this is not an easy thing to do; the second point is how to organize a project so that it is self-sustaining in the long term despite the market failure. This is in a sense an open research problem (that we hope to address during FLOSSMETRICS).

    Thank you very much for sharing your thoughts Carlo, you are always welcome!

    Carlo Daffara is head of research at a small italian OSS consulting company, he has participated in many other working group of IEEE, Internet Society and the EU ICT task force. He worked in 7 EU research projects related to open source and free software. Carlo has also been the Technical Director of the Italian Open Source Consortium for about three years, and he eventually succeeded to the Presidency when I left last year.

    Technorati Tags: Open Source, FLOSSMETRICS, EU

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