Is open source converging with 'proprietary' software?

One analyst says a big chunk of the so-called "open source market" is already made up of leading traditional software vendors such as IBM and Oracle, who are following hybrid open source/propietary business models. And "pure play" vendors aren't necessarily that pure, either.

One senior open source software analyst with whom BetaNews spoke today is
predicting that the business models of companies that deal with open source software are bound to converge with those whose source code is closed off and proprietary.

The distinctions between these software providers' various business models of are becoming less important because, in the end, what users really want most is "good software that doesn't break often," says Dennis Byron, an analyst with ebizQ.

"The market will see a convergence of closed and open source software such that the terms will eventually become meaningless from a research perspective," according to Byron.

As Byron explains in a research study, the open source software (OSS) market is now made up of three types of players: leading traditional software suppliers; classic providers of both information technology and business services; and a "small remaining group of OSS pure plays."

These three groups are competing for an overall OSS market -- estimated by Byron at $250 billion in 2007, and nearing $300 billion in 2011 -- that consists of two components:

One piece of the OSS market is the value of open source software built into traditional software licenses. Here, he offers as an example the "imputed value" of the open source Apache Web server, as included in a couple of products from leading traditional software suppliers: IBM's WebSphere Application Server and Oracle's Fusion middleware.

The other piece of this multibillion dollar market is the value of maintenance revenue from support services for open source software -- such as the service revenue that Red Hat, a major Linux software supplier, receives from selling subscription maintenance contracts for OSS products like Red Hat Enterprise Linux (RHEL) and JBoss middleware.

Almost all of the "leading traditional software suppliers" now involved in the OSS space have by now become "OSS/proprietary hybrids," according to Byron. In this group, he also includes Novell, the distributor of SuSE Linux.

Although OSS "pure plays" are few and far between these days, their ranks include "totally pure" players such as Alfresco as well as those offering dual licenses, such as Compiere, for instance, according to the analyst.

But ultimately "these divisions by types of revenue and suppliers providing the software will become less and less relevant to IT users; they just want good software that doesn't break often but when it does, a substantial company is available to fix it," Byron writes.

Byron arrives at these conclusions through an exploration of the various methods that can be used to "measure" the open source software market.

In the reseatch article described above, as well as in his own blog, "Open Source Software Up the Stack," Byron also voices strong interest in the user survey approach now being utilized by OpenLogic in measuring the "most popular open source packages."

Also in his blog, Byron more than questions whether all the so-called OSS pureplays are truly so pure.

"I quickly found out that all the well-funded OSS pureplays and OSS-heritage hybrids were in fact aggressively marketing their own wares," according to the analyst.