Study of impact of cloud computing on FOSS editors. Based on 5 study cases: Compiere, Nexedi (ERP5), Magento, OpenERP and SugarCRM.

1. EOLE 2013
Considering Free & Open Source in Cloud Strategies
Impact of cloud computing on FOSS editors
FOSS and Cloud: a new deal?
Bruxelles (Belgium) – December 06, 2013
robert.viseur@cetic.be

2. Free and open source softwares (1/2)
●
Definitions :
–
Free software definition.
●
–
See 4 freedoms.
Open Source Definition.
●
See 10 criteria.
→ Famous FOSS licenses.
(e.g. Apache, BSD, MIT, GPL, LGPL, MPL,...)
→Standard legal framework.

3. Free and open source softwares (2/2)
●
Business models are mainly based on:
–
–
●
Collaborative developments for value creation, and...
Services (« best knowledge here » principle) for value capture.
Other business models for value capture :
–
Platform manufacturing.
–
Double licensing schemes.
–
Open core.
–
Hosting (e.g. Web hosting, ASP or SaaS).

4. Cloud computing (1/2)
Definition:
« It is an information technology service model where
computing services (both hardware and software) are
delivered on-demand to customers over a network in a
self-service fashion, independent of device and
location » (Marston et al., 2011).

5. Cloud computing (2/2)
●
Three modes :
–
SaaS.
●
–
PaaS.
●
–
See Google Apps or Salesforce.com.
See Google App Engine or Microsoft Azure.
IaaS.
●
See Amazon S3 (storage) or Amazon EC2 (compute capacity).

6. Facts and figures
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Free and open source softwares use :
–
In France :
●
●
–
2.5 billions in revenues (euros).
30,000 jobs.
Worldwide :
●
●
5 out of 6 developpers use free software components (« commodities »).
Cloud computing use.
–
In France:
●
●
–
2 billions in revenues (euros).
SaaS = 62% of cloud computing uses.
Worldwide :
●
See « Gartner Hyper Cycle ».

7. FOSS vs Cloud computing (1/2)
●
Two disruptive technologies :
–
●
Impact on the creation, the provision and the value capture.
Complementarity or substitution ?
–
Complementarity (1/2) ?
●
Free and open source softwares...
are supported by cloud computing providers.
● See Microsoft Azure or Amazon Web Services.
– are useful to create new cloud computing services.
● See Ikoula (France) with CloudStack.
« As a Service » aspects taken into account by new licenses.
–
●
See AGPL and OSL licences (copyleft with network effect).
New business opportunities.
–
●
–
See free and open source softwares in SaaS mode (subscriptions).

8. FOSS vs Cloud computing (2/2)
●
Complementarity or substitution ?
–
Substitution ?
●
SaaS and FOSS applications are cheaper alternatives to proprietary products but...
●
Diffusion is easier for SaaS products !
–
●
Test, without installation :
● Create account, login, test and (maybe) pay (SaaS mode) versus…
● Download, install locally, test and (maybe) pay (FOSS mode).
New focus on an open cloud definition.
–
See e.g. TIO Libre Definitions (tio.ffii.org).
●
TIO = Total Information Outsourcing.
●
Three levels : TIO Libre / Openness / Loyalty.
–
« TIO Libre » : data freedom, software freedom and competition freedom.

9. Research question
What is the evolution of strategies and business
models of FOSS companies facing to cloud
computing and, particularly, SaaS offers ?
Study to be published in Revue Terminal ( www.revue­
terminal.org).

10. Methodology (1/2)
●
Study cases of five FOSS companies :
–
Compiere.
–
Nexedi (ERP5).
–
Magento.
–
OpenERP.
–
SugarCRM.
●
In the ebusiness field, but...
●
With slight differences between cases:
–
Age of creation of the project / company.
–
Domain (ERP, CRM or ecommerce).
–
More or less strong competition with cloud computing alternatives.
–
Technological background.
–
Level of openess to the community.
–
Different types of investors.

11. Methodology (2/2)
●
Based on public sources of information :
–
–
Articles in specialized newspapers.
–
●
Company websites.
Websites edited by famous « experts » (company founders,
consultants and researchers,...).
Wikipedia used for finding historic events and
documents.

12. Findings (1/2)
●
Complementarity between cloud and FOSS offers.
–
For all studied companies : new sources of revenues based on SaaS offers
build on FOSS.
●
●
Ability to satisfy new customers with weak IT competences (e.g. tiny SME).
●
–
Position of first mover or follower.
Growth potential able to satisfy external investors ?
FOSS advantage : easier personnalization with FOSS.
●
●
Versus functionnal standardization and parameterization for SaaS.
Evolution of the business of the FOSS editors.
–
Evolution of business :
●
Edition and local services → worldwide development and services to network of
partners (integrators) → SaaS offers.
–
Process of structuring the community (→ ecosystem).
–
New competences required for infrastructure management.

13. Findings (2/2)
●
Evolution of the license choice.
–
« Problem » of the network use.
–
Often : evolution of the studied FOSS to AGPL or OSL licenses.
●
●
●
From MPL-like or GPL licenses for older softwares...
And first choice for newer softwares.
Lack of success of TIO initiative.
–
Success of open standards and FOSS linked to the reduction of
lock-in risk.
–
In consequence : interest in open cloud definitions ?
–
Highlighted by only one company...

14. Discussion
●
About freedom :
–
–
Importance of the lock-in for users ?
–
●
Lack of success of TIO definition. Why ?
Conditions for deploying a TIO-compatible cloud ?
About license :
–
Need for anticipating licenses changes.
●
–
Interest for contributor agreement (not always used).
How to choose between AGPL and OSL ?
●
AGLP allows to stay compatible with GNU licenses.
●
OSL simplify the creation of separate ecosystem.
–
Competitive advantage if abundant available IT resources ?

15. Thanks
Contact :
robert.viseur@cetic.be
More information :
www.robertviseur.be
twitter.com/robertviseur
www.linkedin.com/in/robertviseur
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