OpenMFG sidles up to the GPL with OpenRPT

OpenMFG, founded in 2001, provides enterprise resource planning software to small and mid-sized manufacturing companies. It’s one of those businesses whose proprietary product is “built on” open source. But OpenMFG is beginning to put its money where its mouth is: recently the company released one of its modules, OpenRPT, under the GPL.

Back in 2001, some people in the FLOSS community were skeptical about how committed to the open source way companies like OpenMFG were. In an essay entitled “Why Free Software is Better Than Open Source,” Free Software Foundation leader Richard Stallman writes, “These companies seek to gain the favorable cachet of ‘open source’ for their proprietary software products — even though those are not ‘open source software’ — because they have some relationship to free software or because the same company also maintains some free software.”

One of the reasons open source people haven’t liked these companies is because of the impression that they seek to make a buck on the backs of all the developers writing code on their own dime. Sometimes there is only a token code snippet here and there returned to the community. “One company founder said quite explicitly that they would put, into the free package they support, as little of their work as the community would stand for,” Stallman wrote.

In a 2002 interview published at NewsForge, OpenMFG CEO and founder Ned Lilly defended his company’s “leveraging” of open source building blocks, making no apologies for the fact that the resulting product was not open source. “I don’t see why anyone would have any objections to what we’re doing,” Lilly said. “This is 400,000+ lines of code that we wrote ourselves — it’s not as if we’re forking an existing open source project.”

Part of his justification was that this product was revolutionary — much needed by small manufacturing companies who “have never had access to any decent software that allows them to compete with ‘the big boys’ on an even footing,” according to the NewsForge story.

Lilly was one of the co-founders of Great Bridge, a company that tried to build its success on PostgreSQL, but closed its doors in September 2001 after failing to secure investment capital. “As I drew up the plans for Great Bridge, I really clued in on the development model and all the benefits of have these smart people working on the software in a public way.” Lilly saw the main benefit to be cost savings for his company. “Purists get upset about that, but it’s a reality,” he says. “That’s how you get on people’s radar screen.”

With the perceived failure of an open source product to support a successful business, but the knowledge that open source development was a superior model, Lilly went on to launch OpenMFG in October 2001. The product would be based on open source, but no one could view the source code except paying customers, who were not allowed to redistribute the software, but could make changes to the code. “We think they’re hungry for a licensing approach like this,” Lilly said in the NewsForge story.

As time has passed and venture capitalists are falling all over each other to be the first to dole out cash to open source companies, Lilly seems to be warming up to the GPL again. Last month, OpenMFG released the 2.0 version of OpenRPT as free software. “I think the economics of open source and the benefits you get from the community-based approach are really approaching no-brainer status for a lot of people,” Lilly says.

But OpenRPT is a “side product”, not a core offering. Will Lilly ever go all the way? “I think that’s a continuing gut check,” he says. “You have to go and see where the market is and what your customers are asking for. I think our customers are very happy with the hybrid model we have today. It’s not inconceivable that we could open up that process some more.”