Consider yourself excused, Savio...just not correct. You seem to consider "pure" open source inimical to capitalism. The inverse is true. Look around. Just about every industry on the planet functions like open source (business models do) does. Service-based businesses.

Red Hat's new CEO had an opportunity to shake things up so that Red Hat could be successful...he's choosing to do everything as before, though with even more focus on operations. You don't need to lock up customers to drive revenue. Throw away that MBA if that's what it's teaching you.

I'm not arguing from some idealistic position about freedom and what-not. My views on open source are born of in-the-trenches experience seeing them cost less to develop and distribute and being richly rewarded with lots of money for my company's efforts. We're not anomalous - we're just a vanguard. We're making software more like 90% of the rest of the planet.

Google isn't Google because of that 10% proprietary value. It's Google because of its brand. No one searches with Google because of its IP. They search because of its brand. It could give it all away to Yahoo! tomorrow and it wouldn't matter one iota. You can't give away brand.

Perhaps IBM hasn't been the best schoolmaster for this sort of education. But I can tell you that the move to a "pure" model has been driven more sales than Alfresco's semi-open source model did. It has a lot to do with facilitating adoption. But I've blogged on that before.

In short, you don't really need to clarify your views on open source. It's very clear. You think proprietary crutches are important for making up for open source's shortcomings as a real way to make money. I just happen to think you're 100% wrong. We can disagree.

'I believe that focusing on "OSS is different" is a losing business strategy. Investors don't really care about different.'

Focusing on "me-too" is an even bigger losing strategy. 'Different' can come in many forms to companies; I believe they call this 'competitive advantage', for you would-be MBAs out there.

Savio is right - a "pure" OSS vendor can not grow very large. They need to have a proprietary angle - his 90/10 statements. This is true of Red Hat where the RHN is proprietary and for charge. This is true of MySQL where there is either the GPL which forces software vendors to pay license fees, or they sell MySQL Enterprise subscriptions which contain proprietary pieces. In both cases, there are lots of free users in the world of Linux and Fedora and MySQL, but there is a set of users willing to pay for the service and proprietary extensions that Red Hat and MySQL offer.

Where Savio is wrong is "mostly open and big (i.e. Google) does more good for the largest set of users, than fully open and small". Big does not necessarily mean measured by revenue or valuation for stockholders. Big can mean lots of users getting lots of value. And the fact that smaller companies can do that with an open source business model is good...

Re: Matt's comment

"Google isn't Google because of that 10% proprietary value. It's Google because of its brand. No one searches with Google because of its IP. They search because of its brand. It could give it all away to Yahoo! tomorrow and it wouldn't matter one iota. You can't give away brand."

This is simply wrong. Sure, Google is a brand now, but what about when they were a startup? And what keeps Google on top? Are you seriously trying to tell us that anyone can put forward a brand and sell it on that basis alone? Hey, look at me! I'm a brand, treat me special and give me money!!

Business 101, folks. The business offers value to the marketplace based upon their value added. If there is no proprietary content in that value added, then the business is selling commodities. Now, commodities can be sold, and profitably too, but there isn't a big profit margin in them, and there never will because of the constant pricing pressure.

If Yahoo got Google's IP, then that would make Yahoo a viable competitor to Google. It doesn't immediately put Yahoo on top, and they might not get there either, but it certainly gives them a huge advantage.

FOSS's obsession with metaphysical purity does them no favours in the commercial marketplace.

@Brian,

"Sure, Google is a brand now, but what about when they were a startup?"

Sequoia Capital + some minor usability enhancements

Other than that, Google was certainly a "me too" play... in the beginning.

"And what keeps Google on top?"

Brand.

"Are you seriously trying to tell us that anyone can put forward a brand and sell it on that basis alone?"

Yugo. Paris Hilton. "No one ever got fired for buying IBM".

So yes... brand it right and even junk can sell.

"If Yahoo got Google's IP, then that would make Yahoo a viable competitor to Google."

Thats a rather techno-centric view of business. I disagree.

Obama ha. Open Source is Russia, Proprietary software is revolutionary France (avoiding the Godwinian alternative analogy). Open source destroys more of the market than it builds in profit or revenue (bad for France). It took me a long time to realize that another IBMer that came to speak at Apachecon some years back (that I near booed) was right. Open source is the commoditization. There is money in commoditization but smart, well managed companies, in the proprietary business recognize the star, cow, dog, problem child situation has moved from star to cow and milk it until it is a dog and divest on it. Look at BEA, JBoss didn't realize it but they more or less checked out some time ago and are milking their cow (huge installation, no real new features of note, no new real investment, raising prices, letting their "stars" go work for google...which itself is a dotcom bubble waiting to happen). I hope to see more innovation in open source, but most of what happens is mere commoditization -- which is frankly a great thing to be a part of financially speaking...if you're successful. I'd hate to be on the firing end of a successful commoditization effort....but I guess it aint always pretty for the russian farmers either :-). Anyhow, you're threatened, this is okay.

If Open source were really "bla" and "bah humbug" you wouldn't have a multi-page series to tell us just like BEA used to spend pages on why JBoss didn't matter and about sun "Sun doesn't have a credible appserver and we don't expect that to change." nuff said. As far as 1.5% -- that's probably not completely wrong. Melt $100 into $1.50 and you have "American Gangster"...who do you want to be? Him or the guy that got shot in the head near the beginning.