Lightbend: Open-source licensing con game or smart business move?

Repeat after me and V.M. "Vicky" Brasseur, well-known open-source business strategist: "Open source is not a business model." It's a software development model that can be used as part of many business models. That doesn't stop businesses based on open source, however, from blaming opensource for their revenue problems. The latest such is Lightbend, the corporate father of Akka, an important open-source Java middleware program. Lightbend is dropping Akka's open-source Apache license in favor of a non-open Business Source License (BSL) 1.1.

Unless you're a Java developer, chances are you haven't heard of Akka. It's open-source middleware for building Java Virtual Machine (JVM) highly concurrent, distributed, and fault-tolerant systems. It offers Scala and Java APIs to developers to easily build scalable and fault-tolerant software that can scale from PC to cloud applications. You have heard of the companies that use it, however. They include Apple, Disney, GM, HPE, Starbucks, and Tesla. 

But, Jonas Bonér, the company's CEO and project founder, claims those big companies haven't been paying their fair share. So, Bonér is switching Akka to BPL 1.1. He explained, when he "initially chose the Apache 2.0 license for Akka, I was unaware of the impact that choice would have if Akka became a large, global project." 

He still thinks "Apache 2.0 is a very liberal license well suited for early, small open source projects establishing community. It essentially gives users the right to do whatever they want without any restrictions or obligations to contribute back to the community and the project from which they benefit." 

To which I can only say, "Yes, it's an open-source license. That's the name of the game."

But, as he now realized, "Open source is not a business model." So, with the new license: "Production use of the software requires a commercial license. The commercial license will be available for early-stage companies (less than US $25m in annual revenue) at no charge." But, bigger businesses will be charged from $1,995 to $1,295 per core per year.

Other open-source communities and businesses are very unhappy with this move. Peter Zaitsev, CEO and co-founder of Percona, an open-source database company, wasted no time in declaring Lightbend's licensing change a case of open source bait and switch.

From where Zaitsev sits, what Lightbend "really means is that they have decided that they do not believe an open source license (Apache 2.0) suits their business goals best any longer, and a proprietary, source available license (BSL) will be a better fit." The bottom line is that this "unilateral license change will be seen as breaking an unwritten contract with your community, a sign of betrayal. Was it really required for company survival, or was it required so investors in the company get 100x return rather than 10x?"

Over the years, Lightbend had received $84-million in venture capital funding. The most recent round came primarily from Greylock and Bain Capital Ventures.

Zaitsev's not the only one who thinks this licensing change is more about increasing venture capital profit than a sustainable business decision. Simon Phipps, the Open Source Initiative (OSI) Standards and Policy Director, said, "This is another example of a disappointing trend for companies who have retained control of software rights while claiming to offer open-source freedoms pulling the rug when they have gained enough market momentum -- sometimes called a 'rights-ratchet' model. OSI recommends software users pay careful attention to the sustainable presence of open source freedoms when committing to deploying a project."

Stefano Maffulli, the OSI Executive Director, added, "Developers should be very cautious when they sign contributor license agreements (CLA) with open-source companies. They can rip you off by changing the license underneath your donated work." Maffulli also said, "I see where these companies are coming from. And I see their pain, but how they're solving it is tainting open source." 

True, "It's frustrating to maintain open-source software," remarked well-known open-source lawyer and OSS Capital General Partner Heather Meeker, "if the world is using it and no one is giving back. But it's also sad to see a popular project move entirely away from open source." Meeker concluded open-source projects today have "more options to make a sustainable business around open-source software".

Some open-source projects, after seeing the Akka change, are already running from Akka as fast as they can. Leadership of Apache Flink, an important framework and distributed processing engine for stateful computations over data streams, has flatly stated, "We will not use Akka versions with the new license." Instead, moving ahead, "We'll stay on Akka 2.6, the current latest version that is still available under the original license," and look for a replacement. 

Boner replied that it wasn't his intention to cause any problems for Flink. He proposed to fix it by adding an "Additional Use Grant" for Flink in the new Akka BSL license. Matt Sicker, Apache Software Foundation (ASF) Secretary, replied, "he really sees no feasible way to make this style license compatible with ASF projects."

So, how does it all work out? Stay tuned. Both the business and the project are facing great challenges with this licensing change.

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