11.4. Libre Software in the Private Sector Since the early 1990s, it became clear to some European entrepreneurs that libre software was interesting for business. Approximately at the same time in other parts of the world, companies started to use libre software, and a new market niche for companies providing services based upon libre software emerged. During the mid- 1990s, many small companies started to offer services based on the then-new Linux-based operating system (MandrakeSoft in France and SuSE in Germany are well- known cases that will be discussed later in more detail, but they were not unique). Some other companies focused on the libre software infrastructure of the Internet or on specific products (such as Trolltech AS in Norway and MySQL AB in Sweden). By the late 1990s, interest in libre software was strong enough to maintain several mid-size companies devoted (completely or in part) to generic consultancy, support, and development of libre software, such as Alcove in France, Andago in Spain, and ID Pro AG in Germany.[11] Later, starting in the early 2000s, large companies began to show interest in libre software, especially in the secondary sector (these were intensive users of software, although that was not their main line of businesssuch as telecommunications, automotive, aerospace, and banking). In 2005, the list of large European companies with a significant use of libre software is too long to include here. [11] Some of these companies stopped business during the early 2000s. This was the case of ID Pro AG and Alcove (which still maintains a web site in early 2005, http://alcove.com. Andago, http://andago.com, is an example of those still remaining in the market.
A good exponent of the interest of European industry in libre software is the ITEA Report on Open Source Software,[12] published in January 2004, which is aimed at elucidating the libre software world (from legal and economic, to development and quality issues), and uncovering business opportunities and issues to be resolved in relation to it. The following sentences, taken verbatim from the report, may provide some insight on the opinion of those drafting it (and maybe on the view of the companies for which they work): [12] ITEA, http://www.itea-office.org, is a joint effort by many European companies to stimulate precompetitive research and development, specially in the field of information technologies, including in its partnership companies like Alcatel, Bosch, Bull, Daimler-Chrysler, Italtel, Nokia, and Siemens. See http://www.itea-office.org/newsroom/publications/Open_Source_Software.htm.
Depending on the business they are in, companies are likely to have different reasons for using OSS. In some cases, OSS can help them lower the cost of the service, system or product that they offer. In others, their contribution to OSS can help to establish new standards worldwide. By carefully applying license conditions it is certainly possible to derive considerable benefits from OSS, while minimizing the risks. Open Source Software is not the "magic bullet" to solve Europe's software development competitiveness. However, OSS is an important new development and an interesting option for software-intensive systems. Different sources provide different figures for the market share of libre software in Europe, but they are consistent in indicating its continuous growth. The market for libre software in Germany in 2003 was estimated, according to a study by Soreon Research,[13] to be in the region of EUR 131 million (with a projection of more than EUR 300 million for 2007). The manufacturing industry was the one with the highest penetration, with 18% of the companies making significant use of libre software. The structure of the market was heavily based on support services (EUR 81 million) and training (EUR 27 million), and direct sales of software accounted for only EUR 10 million. However, a year later IDC[14] estimated that USD 98 million would be spent on IT services for libre software in the whole of Western Europe, and predicted that USD 228 million would be spent by 2008 (for the same region). [13] Soreon Research "The Market for Open Source Software in Germany" (July 2003).
[14] IDC, "Services around Linux, Open Source, and Free SoftwareWestern European Market Forecast" (June 2004).
To provide an overview of the landscape of European libre software companies, we have selected a short list of them, probably the better-known ones. This list is, of course, not exhaustive, but will hopefully be illustrative enough to show the European contribution to the world of libre software business models: SuSE[15] was one of the first companies providing services for Linux-based distributions, almost since it was founded in 1992 in Germany, as S.u.S.E., by Hubert Mantel, Burchard Steinbild, Roland Dyroff, and Thomas Fehr. They started by selling floppies of Slackware Linux partially translated into German. Later, they decided to build their own distribution, which was released in 1996 and quickly becoming the most-used GNU/Linux distribution in Germany. Based on the success of this distribution, the company grew, with a business model that also included support, training, and consultancy for libre software. It had a workforce of more than 500 and had one of the more well-known GNU/Linux distributions in the world when it was acquired by Novell in 2003, for USD 210 million. SuSE has also been known for its contributions to the libre software community, supporting or directly contributing to many projects, from KDE to ALSA to the Linux kernel itself. [15] SuSEwas bought by Novell, but still maintains its original url: http://suse.com.
MandrakeSoft (http://mandrakesoft.com) is a French company with major operations in the United States and other countries. It was funded in 1998 by Gaël Duval, Frédéric Bastok, and Jacques Le Marois, after the success of the first release of Mandrakelinux some months before. One of its innovations was to let people download the entire distribution from the Net, which assisted its spread around the world. Agreements with the Pearson Technology Group (then Macmillan Software) and other distributors helped too and, by 2000, had made it one of the companies with a larger market share in the libre software segment in the United States and France, having gone from three to about a hundred employees in just two years. In 2004, the company had revenues of more than EUR 5 million. Currently, its business model seems to be mainly linked to its distribution, although it also provides consultancy and support services for libre software in general. MandrakeSoft has recently acquired Conectiva, one of the other companies producing a major GNU/Linux distribution, and has changed its name to Mandriva ( http://www.mandriva.com). Open CASCADE S.A. ( http://opencascade.com), now in the AREVA group, is a French company providing services around the Open CASCADE system (a set of 3D modeling components and libraries) and SALOMÉ (a platform for the integration of numerical simulations), both distributed as libre software. The company is rooted in Matra Datavision, also French, which was a major player in the CAD/CAM market from the early 1980s to the mid-1990s. One of its lead products was CAS.CADE (Computer Aided Software for Computer Aided Design and Engineering), released in 1993. In 1999, after the decision to change the focus of the company from products to services, Matra Datavision decided to release CAS.CADE as libre software, under the name Open CASCADE. One year later, the company of the same name was segregated and acquired by Principia (in the AREVA group). Open CASCADE S.A. is now focused on providing customized development, training, consulting, and other services, with a team of about 80 developers. The company is also fostering the building of communities around its products, channeled through a specific site ( http://opencascade.org). Trolltech AS ( http://trolltech.com) is a Norwegian company well known for producing Qt, an essential component for KDE and many other systems. It was founded in 1994 by Haavard Nord and Eirik Chambe-Eng, with the aim of building cross-platform C++ GUI tools. Now a company with more than 90 employees, it pioneered a dual-licensing model for Qt (and other products). In the beginning, this software was gratis but not free. However, after the launch of the GNOME project (promoted by the FSF, among others, and backed by some companies worried about the dependence of KDE on the proprietary Qt), Trolltech decided to distribute it under QPL (a libre software license). Finally, Trolltech moved to the GPL (for the X11-based version of Qt), and gave those not willing to comply with the GPL the option of purchasing proprietary licenses. MySQL AB (http://mysql.com) is the company that owns the code for the MySQL database server. It was founded in Sweden in 1995 by David Axmark, Allan Larsson, and Michael Widenius (the founders of the MySQL project) and has since opened offices in many countries. Its business model is based on selling support and services for MySQL, and selling licenses to those unwilling to fulfill the conditions of the GPL (that is, dual licensing MySQL). This is why my SQL AB has been careful to maintain the ownership of the code, by having all the developers of MySQL as employees of the company. MySQL AB has run on venture capital since 2001, had revenues of about EUR 15 million in 2004, and about 160 employees.
To complete the vision of this landscape, let us introduce some examples of large European companies involved in libre software. The examples were chosen at random from our experience and therefore are not representative, but again, hopefully illustrative of what is happening out there: ObjectWeb ( http://objectweb.org) is a consortium created in 1999 in France by Bull (http://bull.com), France Telecom R&D (http://rd.francetelecom.com), and INRIA (http://inria.com) to develop libre software middleware, ranging from specific software frameworks and protocol implementations (such as CORBA) to integrated platforms. In 2002, it evolved into an international and independent nonprofit organization open to companies, institutions, and individuals. The software developed by ObjectWeb includes more than 40 products in the application platforms, workflow engines, IDE plug-ins, and software engineering domains. ObjectWeb uses GPL and LGPL licenses, and has managed to create a large community of companies providing services around those products. Based in Spain, Telefonica Investigacion y Desarrollo (TID (http://www.tid.es) a subsidiary of Telefonica ( http://telefonica.com), one of the largest telecommunication companies in the world), launched in late 2004 the Morfeo Project (http://morfeo-project.org), in collaboration with some other Spanish companies, universities, and public administrations. Morfeo is a framework for distributing and developing as libre software some products that TID either has produced or needs, mainly in the field of platform software (middleware, workflow, communications, etc.). It has already released products such as CORBA systems, and is trying to build a community of developers. In the long term, this could be a first step toward a strategy based on libre software for some of the activities of TID. Ericsson (http://ericsson.com), based in Sweden and not especially well known for its contributions to libre software, has distributed several products as libre software. Ericsson's implementation of the Erlang programming language[16] was released in 2000, and has an active developer community. Erlang provides facilities for concurrency, distribution, robustness, and soft real-time processing. Another contribution is TIPC (http://tipc.sourceforge.net), a protocol for intracluster communication implemented as a loadable module for Linux. [16] Open-source Erlang, http://erlang.org.
Nokia (http://nokia.com), based in Finland, and also not normally known as a libre software producer, has distributed some software under NOKOS (the Nokia Open Source License, an OSI-recognized open source license). But recently another event related to the use of libre software by Nokia hit the news: the availability of a Python environment for some of its products (http://www.forum.nokia.com/python) using the Symbian OS, in what could be a strategy of letting libre software developers in the Python community build applications for Nokia devices. Symbian ( http://symbian.com), with headquarters in the UK and owned by Nokia, Siemens, Ericsson, and others, is releasing one of its products for Symbian OS, the Open Programming Language (OPL; http://opl-dev.sourceforge.net), as libre software, using the LGPL. OPL is a BASIC-like language used in Symbian OS phones for rapid prototype development.
These examples show how, despite their general strategy of being more or less oriented toward proprietary software, many European companies are experimenting with libre software models and, in some cases, are considering new lines of business based upon them. In fact, similar cases of exploration of the libre software world can be found in almost any medium to large-size company heavily involved in the software business. |
