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Topic: Oracle

What Oracle has not learned about open source

Summary: The company seems to think it can buy open source like it did its old application ecosystem and force the rest of the open source world to pay its monopoly rents. The company also thinks a mainframe box is a cloud.

Dana Blankenhorn

By Dana Blankenhorn for Linux and Open Source |

Open source requires an attitude adjustment.

Making that adjustment can lead to greater profit with fewer headaches.

IBM made it in the first part of the last decade. I would argue Microsoft made much of it in the second half of the decade.

But not everyone has made the adjustment. The Bells haven't. Tech lobbyists like the Progress and Freedom Foundation haven't, talking of "property" as sacrosanct even when it leads to monopolies that frustrate change, growth, and competition.

Oracle most definitely hasn't, and this is a big problem given their control over what many still consider the crown jewels of open source -- Java and Open Office.

Oracle's ambitions were on display all week in San Francisco, along with its proprietary attitude, best summed up by the adage "what's yours is mine and what's mine is none of your business."

There is nothing "socialist" about sharing infrastructure. America's growth is based on it. From canals to railroads, from ports to freeways, from convention centers to the Internet, shared infrastructure has lowered costs for America's businesses throughout our history, and made our economy the envy of the world.

That's all open source is. When you build from a shared infrastructure you build from a higher base. You also assure yourself access to the widest possible market, since interoperability is built-in.

Oracle doesn't get this. The company seems to think it can buy open source like it did its old application ecosystem and force the rest of the open source world to pay its monopoly rents. The company also thinks a mainframe box is a cloud.

Oracle's ambition is to become a $100 billion company and it's hard to bet against them. But these lessons of open source are basic to every $100 billion tech company out there -- yes, even Apple. Open standards, interoperability, shared infrastructure -- they're what technology is about in the 2010s.

For Oracle to achieve its ambition it has to learn that hard lesson. It has to learn to share. The best news to come from Oracle this week was the appointment of former HP CEO Mark Hurd as co-president, because he has at least confronted it.

The question going forward is, will he confront Larry Ellison with it?

Topics: Oracle, Open Source

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21 comments
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  • Time to take off the fanboy hat for a second

    Open source does require an attitude adjustment. But that goes both ways.

    I am so tired of the open-source-is-automatically-better argument. No one with a straight face can say it's better quality-wise, feature-wise, or even that it's better fix-wise.

    All we can really say for certain is that there is a theoretical ability to fix faster when it's open source, but only for very large companies who can hire programmers or have them on staff. And of course, it's free.

    Of course, there are different degrees of free, and "free" rarely means $0, even in open source.

    I would even argue that "open sourceness" is irrelevant for entire systems. Who cares if an App is open source as long as the database supports ODBC and you can connect to it with something else? Sure, someone might want to modify the App, but %100 of the customers? Of course not. Open-sourceness is probably wasted on %95 of them.

    Maybe what's important is that the glue that ties systems together be open source, but the systems themselves should be whatever we want them to be - open source or not.

    And at the end of the day, it is really hard to make money with open source in a non-services/consulting scenario.

    Look at it logically, you can spend 10,000 man hours writing an open source office suite, but you can't really charge for it as open source because someone can come along, fork the code, and pull the rug out from under you.

    That is the reality Oracle understands very well. Why would they want to structure their business to end up standing on the same rug as everyone else?

    Open source has a place, but that doesn't mean it belongs in every place.
    croberts
    Reply Vote

    • I guess....

      @croberts

      this blog went right over your head. At least so it appears.
      Economister
      Reply Vote

      • RE: What Oracle has not learned about open source

        @Economister

        That's rich. I guessed you missed my point, but that's ok. If you believe all ice cream stores should sell identical vanilla ice cream (open source) and only differentiate themselves by how much the counter guy smiles at you, then more power to you.

        Call me crazy, but I don't think there will ever be a 40 billion dollar empire springing forth in a 100% open-source environment. Open source can perhaps maintain the momentum of a corporation like IBM, but it will never give birth to one.
        croberts
        Reply Vote

      • Not rich at all

        @croberts

        No ice cream vendor can trap you into staying with their ice cream, so that is a silly analogy. Besides, you can make open source any flavor you want, because you have the source code to work with. Not so for proprietary SW.

        As far as $40B corporations go, why can it not be built on open source as a tool or a foundation? And what good is a $40B corporation if it brings many other businesses to their knees due to monopoly pricing?

        I still think the blog went right over your head.
        Economister
        Reply Vote

      • RE: What Oracle has not learned about open source

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        johnny48
        Reply Vote

        • RE: What Oracle has not learned about open source

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          johnny48
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    • RE: What Oracle has not learned about open source

      @croberts As open source projects mature and develop, the development costs are distributed so overall cost (and variety) increase.

      Open source offers LESS homogeneity, not more, by way of multiple sources creating versions/flavors.

      Oracle wants it one way: their way. There are competitive open source solutions out there. The open source competition might not have any single version that is as full featured as Oracle's offerings, but the total accumulation of solution resources are far more expansive than Oracle's "control-based" data eco-system.

      It's about shared costs and distributed return. The potential, in such a high margin model, is for far greater profits. Not reduced profits. This can be seen by IBM converting to primarily a service-based organization geared toward making solutions work, irregardless of who provided the development resources (and also irregardless of who might also be able to perform the same system integrator services).

      When the cost of development is shared, the margins for making the solution work (and subsequent maintenance & support agreements) is far greater than if you also had to bear the entire load of development costs for that solution.

      The only sacrifice you have to make is control. It is reflected in all realms that we desire order and control over life and freedom. Life is chaotic, we can thrive in that without control. Open source may be chaotic, but those who allow it will thrive far easier than the companies sticking to the old ways of control and order as a result of the reduced resource requirements.
      gnostication@...
      Reply Vote

      • Well said

        @gnostication@...

        Thank you
        Economister
        Reply Vote

  • Shared infrastructure ...

    ... is great for building the foundation of an economy or ecosystem. But in order to make money, you have to go proprietary. E.g. how successful do you think you would be, if you tried to sell bottled, tap water in your neighborhood? Wouldn't your neighbors say, "Why would we buy water in your bottles, when we can freely get the same water from the taps in our houses?" It is only when you make your product proprietary, by either filtering it, adding lime and sugar to it, or adding value and differentiating it in some other way, that you can seriously make money. That is why the license you place on Open Source Software (OSS) is so important. Applying the BSD license e.g. to OSS, allows entrepreneurs to make the code proprietary, thereby adding value to the code - so that the entrepreneurs can make money from it. This money helps hire more developers, generate taxes, drive innovation - and is far more valuable than OSS licensed under the GPL, which frustrates the above efforts.

    Dana says IBM was smart for supporting Linux. I say IBM was stupid, because IBM helped shrink the Unix market - as a result of Linux sucking value out of the market, and curtailing funding and impetus for innovation.
    P. Douglas
    Reply Vote

    • Writing software is not a bad thing!

      @P. Douglas
      Back in the early days of the printing press, if a member of public got hold of a book, since they couldn't read they had to find and probably pay someone wo could read, to read it to them. Now, we can all read. Would you reverse this? Why suggest that its a bad thing that we now have the internet and can write our own software? And why on Earth would anyone want to have to be forced to pay for a proprietary Unix? It is better to have alternatives too.
      peter_erskine@...
      Reply Vote

    • Also missing the point completely

      @P. Douglas <br><br>It is not purely about making money. If I could obtain the exclusive rights to the letter "O" I could make a LOT of money, hire a lot of people to monitor and collect, pay taxes etc. I could innovate by trying to get the rights to more letters and digits and make even more money. The problem is, making something proprietary may make ME a lot of money, but it will cost everyone else and society will be worse off, because all that activity creates no ADDITIONAL wealth. As a matter of fact, it REDUCES wealth because all the people involved in my enterprise would not be able to produce real goods and services that society could consume.<br><br>If open source creates a piece of useful code and shares it with a million other people who need the same code, that particular endeavor has become incredibly efficient and low cost. All the time/money they save by getting the code for free can be used for other productive purposes. <br><br>THAT is the advantage of open source. Society and the individuals within it become wealthier by producing more for/with less. Then it is just a matter of how we divide it up. If you studied some economics, your view of the world would change.
      Economister
      Reply Vote

  • But Oracle doesn't have to share.

    They are doing very well as they are. I'm not saying I like them, because I don't. But all they need is to possess something that can't be had from elsewhere (either Free, or, indeed, at all). At the moment, that's their database.
    Open source doesn't take away their prerogative, does it?
    And Open source isn't so much infrastructure, as software by the people, for the people, worked on until it "just works". Oracle doesn't "just work", which could be their disadvantage!
    peter_erskine@...
    Reply Vote

  • RE: What Oracle has not learned about open source

    Sound like it is time to fork Open Office and Java! They may have bought it, but they can't stop anyone from using the freely available source code to continue development, though doing without them will sure slow things down!
    leopards
    Reply Vote

  • Linux is a Cancer

    Well, it was Steve Ballmer who described Linux as "a cancer".

    Do you think he's learned?

    Nope.
    Vbitrate
    Reply Vote

  • Private Toll Roads

    If people want it, they'll pay.
    If they can do it without paying, they will just do it.

    P. Douglas hits the point in the 'Shared Infrastructure' commentary. It all comes down to adding value.

    Public roads are paid by tax dollars with the burden of the cost shared by many for the benefit of all.

    Private toll roads provide access with additional benefit to those able and willing to pay. Note endeavors can come with great risk. If the path adds value, then this justifies the cost.

    But the open source systems often do offer as much value.

    The flip side of open source is sustainability. Naturally, people still need to make a living, and adding value/features/support helps cover their needs.

    Even greater still, people must believe they're a part of something bigger than themselves. Contributing to the code and seeing it's use gives great satisfaction.

    Apparently Oracle has more than this in mind for their business game plan.

    p.s. Kudos to the code warriors.
    rwparks.it
    Reply Vote

    • STILL missing the point

      @rwparks.it <br><br>What the hell does "adding value" mean?<br><br>So someone builds a private toll road across their land between two important centers, creates or adds value, people are willing to pay, because it is the only way to get where they need to go. The road owners make a lot of money because all other ways of traveling between the two destinations are prohibitive. Economic growth is slow due to the toll road. Other areas become more competitive. The local economy suffers.<br><br>Alternative: Expropriate land and build a public road. The owners would get reasonable compensation for the land. The construction costs would remain the same but travel would be a lot cheaper because the owner could not extract excessive economic rent just because he happens to own the land. The owner of the land is worse off but society including all other businesses using the road are better off because they can spend the money saved for more productive purposes. The local economy flourishes because of the new cheap way of traveling between the two centers. Taxes from the healthy economy will easily pay for expropriation and the road construction.<br><br>Guess which route even the US chooses virtually ALL the time. Like I said before, study some economics. It might prevent you from drawing faulty conclusions.
      Economister
      Reply Vote

  • RE: What Oracle has not learned about open source

    and a lot of others. To everyone who says "You can't make money with open-source. You have to give it all away.", here's a little insight:
    Open source programmers make money the same way a MS programmer makes money: he goes to work and gets paid a salary. Neither the open source or MS programmer get paid by unit sold.

    No one really believes every programmer who ever worked on MS Word gets a check every time MS sells a copy, do they?

    Most open-source vendors get paid by selling a solution, as in an entire computer system, or by the software solution, and by after sales support. Nothing in the GPL says I can't put together any number of open-source packages into a business solution and sell it. The GPL says I can't take credit for writing all the software, and I can't sell a GPL package as my own product. But if I install, configure and then set up a Linux computer at a customer site, I can most certainly charge more for system than the hardware costs.
    Duh!
    anothercanuck
    Reply Vote

  • RE: What Oracle has not learned about open source

    Why are none of the comments from open source developers that are getting paid to write open source code? Everyone needs to make a living. If you could provide a real world example of companies that make money writing open source software, then we might all agree. Selling and bundling open source does not count. I can make the same living selling M$ and Oracle. We need to understand how spending money to write open-source gets us paid, today. What happens in 20 years will not put my kids through college. The economy of Star-Trek is not here yet.
    SneakerZ
    Reply Vote

  • RE: What Oracle has not learned about open source

    I'm as hardcore capitalist as they come, but even I see the value of open-source software as its ease in sharing and the benefits that accrue when you and others can work off that same base system. It's your property, but by sharing it, you earn more value than by locking it up. Plus, others get value from that, too, and that's also good to see.

    That isn't fanciful thinking. The past decade is testament to the virtue of sharing your property. It's not automatic, either. It does take serious thought and planning to do it right.

    Oracle may need time to learn these lessons. Let's hope they don't bury themselves before that happens.
    eksortso@...
    Reply Vote

  • Truth is in both sides

    The facts suggest that there is a great opportunity for scare mongering (hence more business for corporate sector) and great open source successes (like Apache). Gone were the days when developing code is purely mathematical and graduates (falsely or hyped up market) believe that they deserve to be paid big bucks.

    Oracle went closed source route to develop cluster solution and failed. bought open source product OCM and suddenly had a cluster without out Veritas. Go figure...
    gprasad2@...
    Reply Vote
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