Patrice Bertrand - Foss models revisited, Is freemium a bad word ?
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This document discusses the freemium business model for open source software vendors. It acknowledges criticisms of freemium but argues that it also has benefits. Freemium provides open source code while also allowing vendors to earn revenue through paid enterprise versions or support contracts. As long as community versions remain open and useful, freemium does not compete with traditional open source and helps open source expand into new domains. The author's view is that freemium overall does more good than harm by supporting open source development through commercial channels.
Patrice Bertrand - Foss models revisited, Is freemium a bad word ?
- 1. Foss models revisited, Is freemium a bad word ? Patrice Bertrand – Is freemium a bad word ?
- 2. Foss models revisited, Is freemium a bad word ? Patrice Bertrand Chairman OWF 2012 Chairman CNLL Founder and manager, Smile Patrice Bertrand – Is freemium a bad word ?
- 3. No free beer ? ● Free, not as in « free beer »... ● Sure, but in real life, who wants to pay ? And how ? ● Most FOSS developpers are paid, and deserve it ! ● A CIO is into cost-cutting all day long ● Why would he or she want to pay if it's optionnal ? ● If it's for the good of mankind, then it's not really in his/her scope and mission ● How about us ? Do we pay if we don't have to ? Patrice Bertrand – Is freemium a bad word ?
- 4. French government advocates free software ● French prime minister's letter on free software in public bodies' IT ● Underlines the need for contributions, both for moral and practical reasons ● Contribution should aim for 5 to 10 % of licence cost saved. Better than most do. Is it the fair rule of thumb ? ● Recommends third party global support, not linked to usage Patrice Bertrand – Is freemium a bad word ?
- 5. FOSS Business Models 3 flavours of FOSS, 3 types of models ● Foundations : shared funding of R&D ● Communities : unpaid volonteers + shared funding ● Vendors : for profit / invest and reap In the past 10 years vendor FOSS has complemented the available FOSS assets Patrice Bertrand – Is freemium a bad word ?
- 6. Why do vendors go for FOSS ? ● A sure way to make lots of money ? ● It's trendy ? ● It will get the product known worldwide in no time (if it's good). Open source is free marketing ? ● Can use wealth of OSS components ? ● Can have some of the development done by others for free ? ● Only way to break monopolies ? Patrice Bertrand – Is freemium a bad word ?
- 7. Open Source Vendors ● Some open source software vendors have a hard time making a living ● The same guys that claim FOSS means not free will scold you if your sales pitch is too demanding ● Heed the cry of the lone FOSS developper : « no-one wants to pay even 100 €, but they all ask for help and fixes. How am I to pay the rent ? » Patrice Bertrand – Is freemium a bad word ?
- 8. Open Source Vendors ● FOSS vendors are for-profit, normal companies ● They have invested a lot in creating the software ● Some have a VC on their back too ● They need some ROI, or they will die. ● How should they get the money ? ● Distribution ? Not any more. ● Integration ? Maybe for a start, but not scalable... Patrice Bertrand – Is freemium a bad word ?
- 9. Open Source Vendors ● Selling support ? Politically correct, but not so easy ● Support bills should pay for development as well ● Customers should accept that support is a way of paying the software. Not all do. ● Thus not turn to third party for support ● And probably accept that support cost is dependant on usage. Patrice Bertrand – Is freemium a bad word ?
- 10. Selling Support Hard to live on support : ● It's so good, why would I need support ? ● Do I really get my money's worth ? ● If I use at scale x100, I don't want to pay x100 (that's what's good about OSS !) ● I might turn to someone else for support, they give it for less ! Patrice Bertrand – Is freemium a bad word ?
- 11. Dual licence / dual versions Distributing under 2 licences is becoming the favoured model An enterprise (ie not open source) version, either : ● Same code with vendor support ● More stable code ● More advanced features Patrice Bertrand – Is freemium a bad word ?
- 12. Is freemium a bad word ? To some, freemium is a scam... What's wrong with freemium, really ? ● It blurs the line between open source and proprietary software ● It boasts all the benefits of open source, but delivers only some ● It sometimes hires rough salesmen with little knowledge or fondness of free software Patrice Bertrand – Is freemium a bad word ?
- 13. What's good with freemium ? ● It adds open source in areas where there is little ● It does offer a wealth of code under GPL licence, for everyone to use, modify and distribute ● The « community version » is used as such by (tens of) thousands ● The « enterprise version » is very good value for the money ● It still is exposed to forks ● It does no harm to « traditional » open source Patrice Bertrand – Is freemium a bad word ?
- 14. Vendor FOSS never competes with traditionnal open source ● Freemium is just one of the models available to open source software vendor ● Vendor FOSS never competes with traditionnal open source : ● If the Apache Foundation offers a DMS, ETL, BPM, that is as good and complete as Hadoop, has a strong community and becomes a standard, then vendors are dead. Patrice Bertrand – Is freemium a bad word ?
- 15. Vendor and community ● The « hub and spoke », « kernel and extensions » model combines vendor and community ● A software architecture model, but also a business model ● Drupal a good example ● Kernel is worth little without extensions. ● Vendor benefits from much development at no cost ● Vendor still controls kernel and guaranties quality Patrice Bertrand – Is freemium a bad word ?
- 16. My personnal view on freemium ● Does more good than wrong, by far ● Programmers must get paid ! That's one way ● Does not compete with rest of Foss, is in different domains ● Does help getting Foss into enterprise ● True, some vendors are getting borderline ● A problem with community versions that are deemed unfit for real use ● I would love Foss associations to rank the openness of major vendors Patrice Bertrand – Is freemium a bad word ?