March 10, 2005

Conference discusses why 'everybody needs an open source strategy'

Author: Jay Lyman

PORTLAND, Ore. -- Far away from the usual open source software industry focus on code, freedom, and evangelism, the InnoTech conference and expo held here this week centered on the business of open source for business' sake.
Sure there was talk about the advantages of Linux and open source technology, the ability to impact operating system-level functionality, and fighting unwarranted fears of a different model, but the heart of the conference was the beat of business -- cutting costs, driving value, and saving time and grief.

"I've worked for IBM in Linux for more than six years, and it has become big business for us," said IBM Linux Technology Center vice president Dan Frye, who sat on a panel discussing how open source software has gone from fad to phenomenon to fact of life in business. "It's a fundamental part of IBM's business. We're not into Linux and open source because it's cool. It's nice that it's cool, but it's good business. We're making billions."

New approach by old businesses

Frye was joined on the panel by heads of companies and firms that had successfully leveraged open source software, development, or related services -- some in combination with proprietary products -- and reported on the state of the new industry in the eyes of old business.

"I tell customers that everybody needs an open source strategy," Frye said. "They need to know what they're going to do. Open source and Linux-based solutions are giving them what they need -- faster, cheaper better -- today."

Andrew Aitken, founder and managing partner of the Palo Alto, Calif.-based open source consulting firm Olliance Group, said that after the birth of Linux operating system distributors, open source "pure plays" such as Sleepycat, Zend and JBoss, the industry was now on the brink of the third stage of open source companies, many of which are old players with a new open source approach: SAP, BEA, CA, and Adobe.

"We're seeing more and more traditional, large vendors looking at how can they leverage their technology and open source," said Aitken, who moderated the session.

He indicated that startups are also a significant segment of the latest open source wave and that new companies are successfully securing funding from venture capitalists who now look for open source.

LaVonne Reimer, executive director of the Open Technology Business Center in Oregon, said open source was important to any tech startup for three reasons: it gets the attention of VCs, it forms the basis of a major technology change under way, and it is increasingly the answer, or at least part of the answer, to the problems that customers want solved.

'Big changes afoot' for new businesses

"If you're starting a company today, you understand there are big changes afoot in computing that affect technology, and software, and chips," she said.

Bill Campbell, a lawyer and partner with the technology law firm Ater Wynne, said his organization's interest in open source intersected with the firm's desire to "help people build great companies." Campbell's firm was home to Diane Peters, who is now general counsel for the Open Source Development Labs (OSDL), and the group has represented OSDL in some of its endeavors, Campbell said.

The attorney likened the open source business model to his own profession in an effort to illustrate that the ideas of openness are not necessarily new.

"Intellectual property is at the center of my profession, and it's all open source," he said, making reference to the law. "We sell expertise as an application."

Acknowledging confusion in the business world over what "open source" really means, Campbell said those new to the concepts of openness and freedom often mistakenly think open source only comes in one flavor.

"Which isn't the reality," he said. "[Open source] is really a philosophy -- a realization that building on an open platform, even turning your own platform into a widely available, transparent code, can be incredibly profitable."

Campbell likened a look ahead to peering into the fog, and stressed that open source software was being driven not only by technology, but also by changes in economic philosophy and "the way you go to market."

Concern that this might be the next bursting bubble

Among the Innotech attendees, there was a sense of concern that open source had become such a hot topic that it might turn into the next bursting bubble and suffer the same letdowns that hit PCs, the Internet, and the dot-coms. However, there was also an appreciation that the basic business advantages of open source software and open technology -- less cost, faster deployment, and flexibility among others -- were forcing industry to look beyond hype and seriously contemplate the new model.

Axian CEO Frank Helle, whose Beaverton, Ore. company provides consulting on both open source and proprietary systems and software, said the conference was a good tech industry event for business people.

"Too often, it's a bunch of techies talking tech," he said. "This is good, fundamental business. We're platform neutral and think the successful business model really boils down not to either/or, it's both/and."

Helle, who was pleased to see there were no zealots from neither the proprietary world nor the open source world at InnoTech, added that it was good to see the open source community "elevate the dialog" to focus on succeeding by solving business problems.

Click Here!