Daniel Lyons of Forbes has an interesting take on the JBoss vs IBM struggle, and attempts to commercialize Open Source in general:
Even proponents like Fleury admit the open source business model is not intended to produce powerful, wealthy, massively profitable software companies.
Yet people are racing into this business, and venture capitalists keep funding them, pumping $150 million into open source startups in 2004, triple the amount for 2003, according to VentureOne.
Sounds like the dot-com bubble, except that this time it's not just investors who will get burned. Customers are taking a risk too. Because when these open source software providers burn through their venture funding and go out of business, customers will need to either hire teams of expensive techies to maintain that orphaned code or pay someone to rip out the old stuff and replace it with something new. Either way, all that free software is suddenly going to look awfully expensive.
Update 20 June 2005
Marc Fluery's opinion on Commercial OSS. This isn't a response to the above diatribe by Daniel, but is reflective of Marc's thinking.
Making a living at OSS is tricky, taxing and leaves me wondering at night. We pulled it off and are making money at about 130 employees but it is a trick. We are destroying value for over-priced software vendors who’ve been milking the licensing system for the past 30 years— we create tons of value for the IT consumer—and whether or not we participate in this wave it is happening anyway— this sort of whining by McVoy is like people complaining about the horse and buggy business going down hill because of the invention of the rail-road. AS LONG AS THE MODEL IS SELF SUSTAINED ECONOMICALLY, the system is defendable.
And Diana Blankenhorn writes trenchantly in defense of OSS:
It's true that open source brings what I would call Moore's Law efficiencies to software for the first time. It's speeding the industry's evolution, and since IBM is the biggest player it benefits. Open source may indeed be bad for industry revenues overall.
But it's the old, proprietary, EULA-based, closed source world that was the scam, not the open source world.
My Opinion
Personally, I believe that open source is commercially viable (but not purely GPL or BSD licensed software). And when there is change, there are always winners and losers. Open source does hurt some parts of the IT industry and benefit others. Is there a net gain to the IT industry in OSS? I think so, but it is more to the benefit of the end-user and perhaps hardware companies, at the cost of shrinking revenues for software vendors. And as the pie gets smaller, companies will get more vicious, as IBM has shown with JBoss.
