Red Hat-JBoss points up seismic shift to an open source stack model

Red Hat-JBoss points up seismic shift to an open source stack model

Summary: Open source, therefore, is no longer on the commodization continuum, of repaving proprietary cowpaths with less expensive and open alternatives. No, what the JBoss/Red Hat combination points to is the open source model going to the cutting-edge continuum of IT.

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TOPICS: Open Source
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It's a seismic shift, this proposed acquisition of JBoss by Red Hat. The open source code/commercial support business model is no longer just riding a commoditizing wave among certain IT stack runtime and tools components. The model is now carving out a disruptive place on a full, modern IT stack basis that extends down to the multi-core silicon threads and right on up to the vanguard of SOA.

For those predominantly commercial source Lock-in is out. Hand-holding is in. (IBM prefers "private" source) vendors, which have made amends with open source and cherry-picked among products to "open," the continued preservation of  their commercial code is now suspect. The escalating JBoss-Red Hat stack strikes at the heart of the data center software infrastructure business. This expanded Red Hat stack is both wide and deep. If end users determine that scale, reliability and manageability of this stack meets their needs, this puts significant downward price pressure on the other infrastructure vendors as they sell a solution, or one-throat-to-choke, value.

Indeed, there are two major trends in open source, as evidenced by last week's LinuxWorld show: open source is moving downstream from Linux into virtualization in a big way, and simultaneously open source is moving up the stack abstraction to SOA. In the meantime, open source is hollowing out the middleware components beyond runtime to groupware, portal, directory, and transactional messaging. Tools is a done deal.

Already in the nascent SOA components market, there are open source ESB projects. There is talk of open source UDDI repositories. Process management runtimes and tools can't be far behind. JBoss's JEMS, with a helping hand from HP, alone has made inroads into open source SOA functionality before the commercial definitions of those components have matured appreciably. In effect, the open source model in a few short years has re-emerged into the domain of forging the definitions and reference platforms of the new generations: on IT's forefront of form and function, based on a consensus model (somewhat gamed) but still community-driven. That is seismic.

Red Hat with JBoss now is in a position to solidify the open source and commercial open source models, as well as break out and extend the model into the hottest areas of IT. With the AOL/iPlanet/Netscape assets it picked up 18 months ago and now JBoss, Red Hat has a powerful and comprehensive open source stack for datacenter, edge computing, early SOA, Enterprise Java, Web 2.0, and tools/Eclipse. There are plenty of other open source projects to augment this march, and the clout of the Red Hat/JBoss market share can help make more of those nascent projects gain traction and therefore be successful in community support.

Open source, therefore, is no longer on the commodization continuum, of repaving proprietary cowpaths with less expensive and open alternatives. No, what the JBoss/Red Hat combination points to is the open source model going to the cutting-edge continuum of IT, and offering the simpler, crawl-walk-run path to higher productivity, exploitation of the most modern mainstream IT trends, and then building out those capabilities into the mixed commercial-open source model that JBoss and Red Hat have done so well by. Users do seem to like the model.

The conventional wisdom has been that the computing world is better served by as many as three, but not more than four, and as few as two, full stack providers. This keeps balance, choice, and competition in place, and prevents a repeat of the IBM mainframe hegemony of the 1970s-1980s, and the WinTel duopology of the 1990s. However, with a viable, full open source soup-to-nuts stack, that equation is set askew. The competition shifts from an emphasis on the code itself to the combination of de facto standard and open implementations to a larger emphasis on field execution and support. The higher differentiation value is therefore on the execution in the field, support, vertical business logic, pure TCO, and the comfort of the long-term relationship with each account on the users' terms.

In other words, lock-in is out. Hand-holding is in. The bully sits on the sidelines, while the helpful tutor gets more of the play-time. Question is, is Marc Fleury a bully or a helpful tutor? I guess it depends on where you sit, inside the sandbox or out on the grass.


Here's a smattering of the more tactical implications from today's M&A bombshell:

  • IBM will need to rethink its relationship to Red Hat. Good news for enterprises: the likelihood of an alternative, IBM-stewarded open source stack (SuSE, Geronimo/Gluecode, Apache, Eclipse, etc etc) to counter balance the Red Hat-JBoss combination. This is already well in motion.
  • Great news for HP, which has been tight with both JBoss and Red Hat. HP has the hardware and services to ride this acquisition well. HP can partner, and let Red Hat manage the stack, while throwing lots of engineering talent at the development process. Hurd is lucky as hell or ... ? (As my high school wrestling coach used to say, Luck has nothing to do with it.)
  • Also good news for the non-IBM global SIs, as they seek to be the best hand-holder in the accounts while exploiting the JBoss/Red Hat stack. Me thinks there will be a margin rout in SIs, however, followed by a wave of consolidation (CSC as harbinger?). Low-cost provider wins. It's nice to own a hardware biz too.
  • Good news for Novell as IBM, HP, BEA, Oracle, Sun will want to make sure that SuSE is a strong and vibrant alternative to Red Hat's Linux distros as Red Hat expands up the stack into SOA with JEMS.
  • SAP would do well to begin segmenting Netweaver to specialized usage, and put an open source stack like the Red Hat/JBoss one under more of its installations.
  • Greenfield Web 2.0-type ISVs and startups have a no-brainer now for an expanded, solution-oriented stack partner in Red Hat.
  • Sun sees less of a differentiation from price and completeness of its JES stack. It won't be a full Red Hat stack vs. a full Sun JES stack. Look for IBM to better assume the counter-balance to Red Hat role (with an open source DB2?). It was a nice try, Sun, but timing is everything.
  • Oracle can not afford to just dabble in open source, it will need to get serious. The business applications business is the only future. Time to write a new rate card on the middleware. And watch out for what IBM does with DB2.
  • BEA is going to have to show that its commercial SOA is so much better than the open source alternatives that the high price is a bargain. Sounds like a niche market that will be under constant price pressure, right from the start.
  • Microsoft is the only non-open source infrastructure player. Time to write a new rate card. Better use pencil.
  • Now Red Hat should buy Borland IDEs, if not for the tools themselves, for the accounts the installed base represents, if nothing else. Support of all those tools fits in quite nicely with the open runtimes.

Topic: Open Source

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20 comments
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  • Dana, a pebble does not make a landslide.

    Dana, I read your blogs (we all need a laugh now and then) and they are all the same. One guy in podunk nowhere adopts something open source and the next day you tell us the entire world has changed and for profit companies are all doomed.

    You really, REALLY need to get out more...
    No_Ax_to_Grind
    • In the water, a pebble creates a ripple effect

      Expect one here. I agree with Dana.
      dberlind
      • Oh, the metaphysics of it all

        Add more pebbles, and the wave form energy gets confused.

        Add barriers, and the wave form energy gets redirected, absorbed, deformed.

        My fav - drop a freaking BIG rock in behind the pebble.....

        Oh yeah, things will change. Geez - that's a nobrainer.

        And if Oracle gobbles up RedHat - where do all these wunnerful scenarios go? IBM gobbles Novell - hmmmmm. Fundimentally proprietary companies OWNING 'open source' stacks.

        But be sure to keep those OSS tithes coming in kiddies - cause soon it'll be your work helping to bolster Oracle/IBM etc. bottom line.....
        quietLee
      • Of course you agree with him, most zealots will.

        Am I in anyway surprised that you agree with an open source supporter? Buwahahahaha, you must be kidding right???
        No_Ax_to_Grind
    • No, Ax,...

      ...it looks to me like you need quit playing ostrich and get your head out of the sand.

      I'm not among those who are predicting the demise of Microsoft, but the company <i>is</i> being nibbled into submission. Their pair of decades of hyper-aggressive bullying is fading fast and, being nothing if not a pragmatic lot, I expect they're going to have admit that the newer, younger, crowd of IT providers are coming up with tactics that their business-by-intimidation model can't effectively counter. Twenty-years of screw-you EULAs, monopolistic tactics and pricing, and overwhelming arrogance have left MS few friends in the IT industry, and now that FOSS, sandals and ponytails notwithstanding, is going mainstream and providing alternatives even the management can't ignore, MS really is going to have to accomodate or die.

      Relax and enjoy it, Ax. Give Fedora Core 5 a try. I expect you'll like it and it doesn't cost a dime to find out.
      Henry Miller
      • Another clueless poster...

        First, Fedora absolutely bites. (I use Novell)

        Second, I have heard these prdictions of MS's fall for years. Guess what? Uh, they made more money this year than ever before. (You and I should be failing so well.)

        Accomodate? MS always does, and then finds the traction to turn it into a positive for themselves. I see nothing and I mean nothing here to convince me anything else is going to happen.
        No_Ax_to_Grind
    • One wonders

      [i]Dana, I read your blogs (we all need a laugh now and then) and they are all the same.[/i]

      Do you have any other way of expressing yourself besides condescention and insult?
      anonymous
  • Red Hat = Microsoft

    Funny how the open source crowd whines about Microsoft, now their preferred vendor is now trying to immitate them with a top to bottom solution.

    So while RH tries to be "like mike", they'll never make it since all the leeches who get free copies will ultimately keep them barely treading water.
    kiteboard
    • So very true...

      In fact as you look around at all these so called open source based companies (IBM, Novell, Red Hat, etc.) you see them smiling in the face of those willing to work for them for nothing and at the sametime sucking it all into proprietary stacks.
      No_Ax_to_Grind
    • 1997

      We've been hearing the "Red Hat is the new Microsoft" mantra for almost a decade now. No sign of it happening.

      [i]So while RH tries to be "like mike", they'll never make it since all the leeches who get free copies will ultimately keep them barely treading water.[/i]

      Care to compare the earnings growth for Red Hat and Microsoft for the last five years? You have a funny definition of "treading water," even assuming that Red Hat is trying to be like Redmond.
      anonymous
      • You're comparing Microsoft and Red Hat growth...

        ... rates for the past 5 years? Okay, but you won't use percentages, I assume, because Red Hat only recently became profitable, so they'd be misleading.

        And please remember to distinguish between $ millions and $ billions. The distinction matters.
        Anton Philidor
        • Stock chart comparison

          http://finance.yahoo.com/q/bc?s=MSFT&t=5y&l=on&z=m&q=l&c=rhat

          Over the past five years, Microsoft has been slightly down (you'd be better off with your money in a passbook savings account. In fact, you'd be better off with your money under a matress.)

          In the same time period, RHAT is up 400%. Not quite Google, but you could do a lot worse.

          Which one looks like a growth company?
          anonymous
  • The problem with open source...

    ...is that a business funded by paid support is disincented to make self-supporting products: simple, quirk-free, usable, self-explanatory, well-documented.
    paul.nicolette@...
    • You're still thinking monopoly

      [iThe problem with open source is that a business funded by paid support is disincented to make self-supporting products: simple, quirk-free, usable, self-explanatory, well-documented.[/i]

      That's only true if they can keep others from making the same improvements, and if they are the only shop in town that can support said software.

      If Red Hat doesn't offer a compelling value proposition (including prompt, well-tested updates) then there are plenty of others who are more than ready to take the business from them.
      anonymous
      • On enterprise "value propositions" ...

        ... there are Red Hat and SuSE and... SuSE and Red Hat. Oh, and did I mention SuSE?

        You wrote:
        If Red Hat doesn't offer a compelling value proposition (including prompt, well-tested updates) then there are plenty of others who are more than ready to take the business from them.
        EoQ

        There are currently only two "commercial" versions of Linux. Are you saying that a third will gain the recognition needed from proprietary companies and others?
        Anton Philidor
        • Mistaken assumption

          [i]There are currently only two "commercial" versions of Linux. Are you saying that a third will gain the recognition needed from proprietary companies and others?[/i]

          Debian actually has a pretty fair market profile, as does TurboLinux in Asia. Mandriva is doing quite well in Latin America and Europe. Of course, Red Flag is the Asian Dragon.

          All (save perhaps Red Flag) have enough toehold in North America to capitalize if either Red Hat or Novell slip. The trick is that there's no particular barrier to entry, so the market is highly volatile.
          anonymous
  • Borland

    [i]Now Red Hat should buy Borland IDEs, if not for the tools themselves, for the accounts the installed base represents, if nothing else.[/i]

    Watch for the fine print on this one. Borland holds a patent on an exception-handling mechanism that is the #1 technical roadblock to full Win32 compatibility for WINE. If Red Hat got the rights to that one in the deal, the long-term prospects for 100% MS binary compatibility would clear up.

    You read it here first.
    anonymous
    • FYI

      Readers may not know,

      Borland has announced their intention to sell the Windows IDEs product lines, in favor of funneling R&D dollars into new OSS Eclipse-based programming tool product development.

      How they intend to survive meanwhile is another question.

      So, in that respect, I can see where, potentially, Borland's long-term objectives may be a good fit with Red Hat.
      D T Schmitz
  • Tom Sawyers of open source make millions while contributors work for free

    Dana, there may indeed be a seismic shift happening...but what are the consequences? Will free open source developers "contributors" be willing to work for free while the "Tom Sawyer" leaders make hundreds of millions?

    Remember the Adventures of Tom Sawyer and Huckleberry Finn? Tom convinced his friends to work for free and paint the fence for him. "Come on...it will be fun"

    Now that there is big money involved will the patent lawyers start filing patent infringement lawsuits against these open source companies?

    Will the business models change once big companies pay hundreds of millions for an open source company?

    I wrote a blog today where I explore some of these subjects. read the whole story at
    http://dondodge.typepad.com/the_next_big_thing/2006/04/the_tom_sawyers.html
    DonDodge
    • And this is different than Bill Gates....

      ....and his close circle making billions while everyone else works for chump-change.

      The M$ model requires hiring thousands of H-1B's - That must be the indentured servitude model.

      I'm also not sure that the open source community will like the way you profer us all up as rubes, either. Would the line be the same had your employer made the purchase or would you be reaching out with open arms? Smell of sour grapes wafts through the air........
      nottheusual1