CIO Magazine's Christopher Koch has a great matrix of Open Source business models in this month's issue as part of the cover story Free Code for Sale: The New Business of Open Source. The text is pasted below for posterity's sake. All credit to Chris and CIO Mag.

Open Source + Service
What it means: Companies sell support and services around open-source software.
Who’s doing it: Compiere (ERP), JBoss (middleware), Red Hat (Linux)
Advantages for CIOs: You pay only for support, not software. The cost to switch providers is relatively low because the source code is available to anyone.
Startup challenges: Difficult to build businesses because switching costs are low, …

Network World just published an excellent story on open source M&A, and whether commercialization of open source is harmful or helpful to open source software development. The best quotes in the article come from large enterprises that use open source:

Barry Strasnick, CIO, CitiStreet (and JBoss customer):

"I believe what will really determine the success or failure of commercial firms purchasing open source vendors is the extent to which they can keep the key developers. One of the main reasons that CitiStreet likes to deal with vendors such as JBoss is that our senior technical staff can deal with their technical staff, instead of having to deal with useless layers in between. We don't buy software because of fancy brochures or well-dressed sales staff. We buy software to gain benefit from great programmers.Could JBoss possibly …

I ran into Ransom Love, former CEO of Caldera, at this past Open Source Business Conference. He's in a new gig and is much happier. Talking with Ransom reminded me of just how far we've come in open source (or how far we've fallen, if you're of that mind).

Years ago, Ransom was vilified for saying things that we now take largely for granted. He wanted to charge a per unit license charge, arguing that support was not a good enough business model (or, at least, not the only business model for open source), and was classified a "parasite." Today, Red Hat has created a fantastic business with a per unit license model. (Yes, they call it "support," but it's really a license fee.) Today, SugarCRM, Alfresco, etc. etc. etc. all essentially charge this way, though we've become creative in …

Marten Mickos today confirmed with Stephen Shankland @ CNET that Oracle tried to buy MySQL. Not sure when, but it sounds recent (and, I suspect, more than once). It's not surprising that Oracle would make this move, though it surprises me that it wasn't IBM (which is not to say that they haven't tried, too - I haven't asked Marten that) - IBM has a clear strategy of using open source as a "low-end" alternative to its high-end products.

What is most impressive in all this (and just one reason that I think Marten is one of the top CEOs anywhere, and certainly in open source business) is Marten's response to Stephen's question as to why not sell:

"We will be part of a larger company, but it will be called MySQL."It's a different riff on the same theme that …

Marten Mickos said something last night during the OSBC Executive Town Hall that was both provocative and profound. Asked whether the acquisitions of Sleepycat and InnoDB were a threat to MySQL, Marten suggested that no one can successfully acquire the life out of a successful open source company:

"Trying to kill MySQL by acquiring open source is like trying to kill a dolphin by drinking the ocean."I'm not sure I got it exactly right, but that's about it. His point? Successful communities are not subject to one or two dependencies, people-related or technology-related or otherwise. Successful communities grow, self-heal, and adapt. I agree.

But then, I don't think (and I somewhat doubt if Marten thinks this - he's certainly never said so) that Oracle is attempting to kill MySQL through its acquisitions. Its intentions are elsewhere....Where? I'm not yet 100% sure.

With Oracle Corporation purchasing InnoBase, the company providing the InnoDB Storage Engine, and now reliable rumors of the acquisition of SleepyCat, the BDB Storage Engine, both key transactional storage engines for MySQL are effectively owned by a competitor.

While the is a strange and probably unchartered territory for both organisations, I’m personally concerned. I use InnoDB extensively, however if there was a comparable alternative within MySQL I’d consider switching out of principle. Is Oracle purchasing these organisations a bad thing? We don’t know. That’s the problem. While MySQL will undoubtly continue to provide these storage engines as part of the MySQL Database I believe a call to arms is needed.

It’s true that Oracle helped more general adoption of Linux …

So, my data on $1.3 billion raised in open source venture capital is already old....MySQL just announced that it has raised $18.5 in a Series C round of funding. Investors included Institutional Venture Partners (IVP), which led the round, and corporate investors Intel Capital, Red Hat, SAP, and and Presidio STX.

Keep on rockin' in the free world, Marten! (You and Neil Young.)

Previously:
MySQL 5.0 hits 1 million downloads-Interview with Zack Urlocker
A happy new year for MySQL
…

The Department of Commerce's United States Patent and Trademark Office (USPTO) has created a partnership with the open source community to ensure that patent examiners have improved access to all available prior art relating to software code during the patent examination process.

In December the USPTO representatives met with members of the open source software community, which provided an opportunity for members to discuss with the USPTO prior art access issues related to software patent quality. The meeting focused on getting the best prior art references to the examiner during the initial examination process.

As a follow-up to their December 6th meeting, USPTO representatives will hold another meeting on February 16th, 2006. This meeting will be open to the public and will focus on further developing previously discussed initiatives as well as any new prior art initiatives offered at that time.

All members of the open …

What with the hoopla around the possible JBoss (and other) acqusitions in the near term, it set me to thinking about how open source companies should be valued. Once they "grow up," of course, like Red Hat, they're valued in a somewhat rational (P/E) fashion.

But how does one value the frontier of open source business models? How does one value downloads? (I remember Kevin Harvey of Benchmark and David Skok at Matrix both telling me that part of their investment calculus in open source companies/projects hinges on downloads, but how do these factor into an acquisition?) Do downloads equal "community" and, if so, is "community" something that can be valued? (In my conversations with IBM, they certainly seemed to think so, though they didn't share with me how they'd do so.)

And what about …

Still in "ponder" mode on the possible Oracle acquisition of JBoss, and came across this interesting tidbit from the Enterprise Open Source Journal (worth a read, if for no other reason than to see Julie in "pensive mode :-). Mark Driver from Gartner writes [PDF download]:

"The [Oracle acquisition of InnoBase] has left many of us scratching our collective heads. On the surface, the motives seem obvious. Oracle, with a clear history of aggressive acquisitions, buys out a critical component of MySQL in order to kill off its commercial support channel. The problem is, we don't actually know the motive yet because Oracle has been mysteriously silent about the acquisition, citing "license negotiations" as the reason. By the time you read this, the issue may be resolved, but I fear it's a lose lose situation for …