5 ms·

You can go for adoption / mindshare and consulting, or you can go for selling the product. There's very little in between when even the largest expected adopter

by _cenw 3y ago

You can go for adoption / mindshare and consulting, or you can go for selling the product. There's very little in between when even the largest expected adopters can only derive little convenience from paying you. "If the product is good enough and solves a genuine problem, you won't have difficulties monetizing." is wishful thinking. Look at Elastic, MongoDB, RHEL and HashiCorp - all with amazing adoption - having trouble attracting paying customers to pay them over someone else and subsequently having to remove the ability of others to monetize their product.

imiric 3y ago
> Look at Elastic, MongoDB, RHEL and HashiCorp - all with amazing adoption - having trouble attracting paying customers to pay them over someone else and subsequently having to remove the ability of others to monetize their product. Those are still service problems. If you as the author of the project can't build a solid moat around it that entices users to use your commercial service over someone else's, that means you haven't done a good job at it, and others have. It's a difficult balance to keep OSS users happy, while also making the best commercial offering. Not many companies do this right. I think Grafana has done a solid job of monetizing the open core model. I struggle to think of others, but I'm sure they exist. EDIT: Another example might be Automattic. I'm not a WordPress user, but AFAIK it has a very healthy open source community, and wordpress.com is _the_ place to use it commercially. Doesn't WP run something like half of all web sites?
- arccy 3y ago
  wordpress has a horrible reputation in software/plugin quality, so you pay someone else to run it for you.
- brabel 3y ago
  > I struggle to think of others, but I'm sure they exist. Do you also struggle to think of businesses who are not OSS but successful? I think the list of non-opensource companies that became big is much, much larger - to the point I think it's fair to say successful OSS companies (from the perspective of making money, at least) are the extreme exception.
  - imiric 3y ago
    That goes without saying. Building a successful company is hard enough. Doing it based on an open source product is even harder. But companies that do this right generate far more good will from their users than companies building strictly closed source products. This is a good thing for users, customers, the company and its shareholders. But for this to work, it's important that the founders believe in open source as something more than just a business strategy.
- _cenw 3y ago
  This is simply not true. There's an initial cost of getting your engineers familiar with a codebase, sure, but that's still substantially less than building and maintaining the damn thing. Someone outside the project maintainers will always have a smaller cost basis for the tradeoff of not controlling what goes into the code (a power you say they shoudn't abuse - and most of the examples I named did, i.e. Terraform Cloud integration) and not being able to say "from the makers of <thing>". I don't think that's enough, especially if the other company is AWS. Also, Wordpress has a lot of competitors. Pantheon and Pressable come to mind in the enterprise space, with every commodity webhoster using Plesk for a less managed but very budget experience.
  - imiric 3y ago
    > Someone outside the project maintainers will always have a smaller cost basis for the tradeoff of not controlling what goes into the code How do you figure this? Nobody will know the product, its users and their needs better than the original authors. They have a distinct advantage over any competitor who only offers a commercial wrapper around it. Not to mention that they have full control over the direction of the product, and can at anytime introduce a new feature their commercial service takes advantage of from day one. Their competitors could also fork the OSS product, but it's very likely that the OSS userbase stays with the original authors. Again, for this to work the authors need to be both great OSS stewards, and great business leaders. Not many companies do this correctly. > I don't think that's enough, especially if the other company is AWS. By the time AWS takes notice of your product, you should already be quite successful at your own business, in a way that they can't compete. The companies AWS stole lunch from didn't do this properly, and their only recourse was a license change. > a power you say they shoudn't abuse - and most of the examples I named did Yes, I'm not arguing those companies don't exist. I'm saying that it's not in their best interest to do so, considering how much community backlash can hurt them. You also ignored my two examples of companies which I think do this right, and have successful businesses. > Also, Wordpress has a lot of competitors. Sure it does. Hooray for open source. https://wordpress.com/hosting/ https://wordpress.com/hosting/ lists some of them. The goal for the original authors is to offer the _best_ service so that customers will want to choose them over the competition. Or maybe they can focus on a certain slice of the market, and leave others to cover the rest. The pie can be big enough for everyone. This is not unlike any other company. Competition will always exist. But again, the original authors will always have an advantage. Not knowing how to do this properly speaks more about the company than about open source. This isn't impossible, just very difficult.
guappa 3y ago
I think mongodb was more of a fad than a product.
- threeseed 3y ago
  The company made over a billion in revenue last year.
  - guappa 3y ago
    How much profit?

by _cenw 3y ago

imiric 3y ago

> Look at Elastic, MongoDB, RHEL and HashiCorp - all with amazing adoption - having trouble attracting paying customers to pay them over someone else and subsequently having to remove the ability of others to monetize their product. Those are still service problems. If you as the author of the project can't build a solid moat around it that entices users to use your commercial service over someone else's, that means you haven't done a good job at it, and others have. It's a difficult balance to keep OSS users happy, while also making the best commercial offering. Not many companies do this right. I think Grafana has done a solid job of monetizing the open core model. I struggle to think of others, but I'm sure they exist. EDIT: Another example might be Automattic. I'm not a WordPress user, but AFAIK it has a very healthy open source community, and wordpress.com is _the_ place to use it commercially. Doesn't WP run something like half of all web sites?

arccy 3y ago
wordpress has a horrible reputation in software/plugin quality, so you pay someone else to run it for you.
brabel 3y ago
> I struggle to think of others, but I'm sure they exist. Do you also struggle to think of businesses who are not OSS but successful? I think the list of non-opensource companies that became big is much, much larger - to the point I think it's fair to say successful OSS companies (from the perspective of making money, at least) are the extreme exception.
- imiric 3y ago
  That goes without saying. Building a successful company is hard enough. Doing it based on an open source product is even harder. But companies that do this right generate far more good will from their users than companies building strictly closed source products. This is a good thing for users, customers, the company and its shareholders. But for this to work, it's important that the founders believe in open source as something more than just a business strategy.
_cenw 3y ago
This is simply not true. There's an initial cost of getting your engineers familiar with a codebase, sure, but that's still substantially less than building and maintaining the damn thing. Someone outside the project maintainers will always have a smaller cost basis for the tradeoff of not controlling what goes into the code (a power you say they shoudn't abuse - and most of the examples I named did, i.e. Terraform Cloud integration) and not being able to say "from the makers of <thing>". I don't think that's enough, especially if the other company is AWS. Also, Wordpress has a lot of competitors. Pantheon and Pressable come to mind in the enterprise space, with every commodity webhoster using Plesk for a less managed but very budget experience.
- imiric 3y ago
  > Someone outside the project maintainers will always have a smaller cost basis for the tradeoff of not controlling what goes into the code How do you figure this? Nobody will know the product, its users and their needs better than the original authors. They have a distinct advantage over any competitor who only offers a commercial wrapper around it. Not to mention that they have full control over the direction of the product, and can at anytime introduce a new feature their commercial service takes advantage of from day one. Their competitors could also fork the OSS product, but it's very likely that the OSS userbase stays with the original authors. Again, for this to work the authors need to be both great OSS stewards, and great business leaders. Not many companies do this correctly. > I don't think that's enough, especially if the other company is AWS. By the time AWS takes notice of your product, you should already be quite successful at your own business, in a way that they can't compete. The companies AWS stole lunch from didn't do this properly, and their only recourse was a license change. > a power you say they shoudn't abuse - and most of the examples I named did Yes, I'm not arguing those companies don't exist. I'm saying that it's not in their best interest to do so, considering how much community backlash can hurt them. You also ignored my two examples of companies which I think do this right, and have successful businesses. > Also, Wordpress has a lot of competitors. Sure it does. Hooray for open source. https://wordpress.com/hosting/ https://wordpress.com/hosting/ lists some of them. The goal for the original authors is to offer the _best_ service so that customers will want to choose them over the competition. Or maybe they can focus on a certain slice of the market, and leave others to cover the rest. The pie can be big enough for everyone. This is not unlike any other company. Competition will always exist. But again, the original authors will always have an advantage. Not knowing how to do this properly speaks more about the company than about open source. This isn't impossible, just very difficult.

guappa 3y ago

I think mongodb was more of a fad than a product.

threeseed 3y ago
The company made over a billion in revenue last year.
- guappa 3y ago
  How much profit?