In the IDM vendor ring: Open Source Vs Closed Source

May/June Edition, 2007: On fight night, IDM put a number of vendors in the online ring to determine the world champion of content and document management solutions. Would it be open source or closed source? Of course there was no world champion, but it did provoke some interesting debate.

Is it just a matter of cost vs risk?

The Contenders

Blue Side :Alex Lee, managing director, Lateral Minds (Alfresco Software), John-Paul, Squiz

Red Side :Kris Brown, CTO Tower Software, Bruce Wren, CEO, Netcat, Nick Inglis, director, Avand

The AnalystDr Steve Hodgkinson, Research Director, Ovum

Alex Lee from Lateral Minds, supplier of Alfresco and Documentum, launched the proceedings by asking if the debate over open source vs. closed source was really any more complicated than cost vs. risk. The question ignited punches as vendors determined that packaged open source solutions often run up the same costs as proprietary solutions.

“Absolutely the debate is more complicated that cost vs. risk,” said John-Paul Syriatowicz, managing director and co-founder of open source CMS provider, Squiz. “People do not necessarily use open source software to save costs. If you engage a professional services firm to support you in the use of an OS product then you’ll be up for similar costs to those seen with traditional proprietary products.”

But Kris Brown from Avand hit back, stating Syriatowicz was merely repeating the common platform of OS software advocates. “First, they make the correct statement that implementing systems cost money. I agree, and more importantly, the customisation of OS systems sometimes gets better value for money than a COTS (commercial off the shelf) product,” he said. “But the competitive side of OS software advocates will always make the claim that it is then free... I can add more people for free... when in actual fact, it is more likely that my new regional office has slightly different requirements than the others and now additional customisation and ongoing maintenance must now be weighed up against, lack of usability in that region.”

The seduction of the $0 price-tag

Bruce Wren from proprietary CMS provider Netcat, was also quick to push the ‘illusion’ that open source applications are actually free. “Sugar CRM and MySource Matrix both have add on software modules which the customer pays for! And let's not forget that all implementers (ourselves included) are driven by the profit motive,” he says. “Having a highly configurable "out of the box" product can save large customers thousands of dollars and considerable effort.

“We would argue that a highly tuned CMS product, bench tested and honed to the highest QA standards by the same team over many years, will be easier to deploy than software which is assembled from disparate sources.”

Nick Inglis from Avand backed up Wren’s comment by adding that for those organisations with weak development teams who are ‘seduced’ by the price tag of OS, they may find themselves caught in a difficult situation. “They will either fail to get an enterprise open source application running, or (worse) will get it running but be unable to maintain it in the long run,” he says. “A strong development organisation can waste a lot of time developing solutions around proprietary technology, or ‘bending’ a technology to make it do what they want, only to find their efforts blown away by the next version of the technology. We have seen both cases.”

Peer review and the audit of code

Aside from costs, John-Paul Syriatowicz was quick to highlight the key benefits of open source solutions, especially the sense of security enabled from open source code’s ability to be ‘scrutinised’ and audited while also offering the security of vendor independence. “By that I mean, a vendor cannot hold customers over a barrel because the customer is always free to seek support elsewhere – either-in-house of contracted,” he says. “If an OS product has a strong user base, it doesn’t disappear overnight, even if a company goes bust of is acquired by a competitor.”

But Kris Brown believes a peer review system of software by no means leads to better software, especially in the ECM market where strict measures of security are required. “For an organisation to say that their software is more secure, just because it is open source, is making the assumption that there are people out there with the appropriate qualifications, and time auditing the software,” he says. “I agree this has been the case for a number of open source projects, but it is not always the case.”

“I agree that open source does not in itself make software any more secure – but client do have more options to test for themselves,” replied Syriatowicz. “That in turn creates a culture in our organisation focused on security.”

For Bruce Wren, the nature of proprietary software is also an issue for discussion. “Like Coca Cola, or GE we have a brand and it stands for something. It means everything to us that the customer, knows what they're getting - a quality product that's reliable, consistent, scalable, friendly, fast-to-deploy, modular, and price-competitive,” he says. “If it doesn't work, then we deserve to be sued. The difference between ourselves and the open source folks is we stand behind the product and the services - there's nowhere to hide!”

A changing market space?

When it comes to the actual vendor market for these solutions, Alex Lee points to the recent consolidation of Enterprise software vendors and highlights some of the key reasons behind this. He suggests vendors are currently buying up other vendors in order to purchase their product features via acquisition rather than development, while also buying up existing customer bases to secure additional revenue from maintenance fees.

“By providing a commercially supported model, Open Source ‘vendors’ are now directly competing for the maintenance dollar that proprietary software companies had sole access to...and as such, more Enterprise end-users are considering and even mandating Open Source alternative,” says Lee.

But for end-users, Lee points out that it’s this purchase of support and maintenance that is often a decision based on risk management. “The new Open Source model, that of providing "free" Open Source software but also commercial support, directly addresses this 'risk management' issue which tends to be a significant part of why organisations don’t go with Open Source software, other than at a low level,” he says.

“So by providing a commercially supported model, Open Source ‘vendors’ are now directly competing for the maintenance dollar that proprietary software companies had sole access to,” adds Lee. “As such, more Enterprise end-users are considering and even mandating Open Source alternatives.”

Steve Hodgkinson from Ovum brought web 2.0 trends into the equation, labelling it ‘SOA in the Wild’ with its integration of complex applications, combined with open standards and open source software in the move towards ‘global SOA.’ “The concept of 'SOA in the wild' emphasises that this is a phase of highly decentralised development where individual start-up style software companies are creating web services focused on specialised services and users,” he says.

Darwinian ‘survival-of-the-fittest’ in the Web 2.0 wild

Hodgkinson likens ‘SOA in the Wild’ to Darwinian survival-of-the-fittest. “Forces in the wilds of the internet will determine which web services prosper and become the building blocks of the next generation of software-as-a-service applications,” he says. “Ultimately these web services will be 'mashed-up', or re-assembled, back into integrated applications based on user needs ... such as Google's ongoing assembly of a Software-as-a-service replacement of Microsoft Office.”

Alex Lee also introduced the idea that the growth in SaaS models of delivery is reflective of the erosion of the traditional license model. “The perception of value of the Enterprise Software License is under question and end-users are moving away from an expectation that they have to buy licenses upfront in order to meet their business needs,” he says.

So, is open source for the average end-user, does it’s usability make it a truly consumerable application? According to Lee, open source projects have come a long way since the days when they only focused on a clear target market of highly technical users. “This is not true of a CRM or ECM user...they are likely not technical and are looking for a different experience, one that contributes to their productivity without a significant need for training or technical knowledge,” he says. “Thus Open Source providers these days are concentrating hard on the user experience and the usability of their systems...because their target audience demands it.”

Nick Inglis believes the choice between OS and proprietary software comes down to the nature of the organisation implementing the software. “If you are in a non-development shop, proprietary software by an established vendor is for you, as you will want them there to support you, and you will want them to last as long as you see yourself using the product,” he says. “The benefit is that you don't need a development team - you can concentrate on your core business.”

The decision

Overall, there appears to be a big shift in the paradigm going on, whether or not this is just a market phase is yet to be determined but Hodgekinson says, it could all eventually settle down again into some form of ‘proprietary’ model. “Alternatively, maybe the web 2.0 trend will create a sustainable shift towards a more fragmented, decentralised, market with mash-ups creating a constantly evolving milieu of applications with users calling the shots rather than vendors ...”

There was some consensus from vendors on the fact that open source can offer end-users the ability to customise software to meet their needs, yet with ready-made applications, closed source vendors were quick to point out that customisation comes at an additional cost and risk.”

So is it open source or closed source that is the right solution for end-users? According to Inglis, “If an organisation ‘knows itself’ it should make the right decision.”

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