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Tapping into the best of both worlds

Stacy Baird | Aug. 16, 2010
How the business models of proprietary and open-source software companies have evolved.

In my earlier commentary, I spoke at length about how CIOs are increasingly choosing a combination of proprietary and open-source software to meet their requirements. These software companies have also respectively evolved their business models to meet customer needs.

Lets start with IBM. A typical IBM system today will consist predominantly of proprietary software: WebSphere server software, DB2 database application, and the Lotus productivity suite running on IBM servers. IBM is also a leading commercial supporter of open source, funding numerous open-source projects, including early Linux development, and releasing a portfolio of patented code as open source. Their support, along with Suns, was significant to the growth of the open-source community in the 1990s. IBM has also provided proprietary code to corollary open-source projects (e.g., Lotus Notes code to the OpenOffice project).

Then, we have Oracle which is known for its proprietary enterprise databases. Yet Oracle was the first enterprise database to run on Linux and developed Fusion Middleware to provide interoperability between J2EE and Microsofts .NET frameworks. Oracle supports versions of Red Hat Enterprise Linux (RHEL) that Red Hat no longer supports and sells their own version of RHEL.

More recently, Oracle entered an agreement with Amazon Web Services to offer Linux-based services. Sun, now a part of Oracle, primarily sells enterprise servers but offers a large suite of enterprise software. It was a major convert from proprietary to open source and supported numerous open source projects. Sun eventually made most of its software available as open source. One of Suns (now Oracles) major products is Sun-MySQL, an open-source enterprise database that can be licensed under either the GPL or a traditional commercial licence. This dual-licensing scheme is a notable evolution open-source licensing.

Even with software as its core business, Microsoft undertook to offer customer benefits of open source and bridge its software with open source. It initiated the Shared Source Initiative to provide the source code for Windows and other software to partners, certain customers (including governments) and academics. The company created the Open Source Lab to participate in and support the open-source community.

In 2008, Microsoft published Interoperability Principles, committing to change business practices to better insure interoperability with open source and other IT platforms. To enable enterprises to run both Windows Servers and Linux Servers in the same physical environment, the company sought agreements, first with Novell to develop standards-based virtualisation so that SUSE Linux Enterprise Servers could run as guest on Microsoft Servers and visa versa (they also worked on interoperability between open source productivity software and Microsoft Office), and more recently, with Red Hat to ensure interoperability between their respective products.


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