Compiere from the Source

Open Source Business Models (for Compiere)

In this post, I elaborate on options of open source business software providers based on my experience with Compiere. This is from the perspective of an open source vendor/provider - and with the assumption that you are looking for an income stream.  This is a bit different from the interests of businesses using open source products for income.  In the first part of the series, I outlined the development of the open source business model of Compiere, in the second one the dynamics of open source contribution I experienced.

Open Source basics

The fundamental promise of open source is vendor independence, that you can use and modify the the product ... assuming you have the skills and time.

From an commercial open source provider point of view (i.e. you want/need to create income), the fundamental challenge is that users have no obligation to “give back”. This giving back might include contributing product enhancements, helping others or donations.

In addition to providers and users there is a third group: intermediaries, who help end users use the product in exchange for payment.  Also here no obligation to give back.

A challenge for commercial open source vendors is that - if the project provides true vendor Independence - despite best intensions, in tough times payments to the open source vendor are in danger of becoming discretionary.

The basic question: How do you want to make money?

After open sourcing your product, your income options are reduced. Here are the usual options:

Service based

• Consulting
• Support, Maintanance
• Hosting

Product based

• Product add-on / extensions
• Sponsored develipment
• Legal (commercial license, hold harmless agreement)

Are you the real provider?

A provider has the legal rights to the product over and above the Open Source license (i.e. you “own” the product). If you are not the provider, you options are reduced.  The usual options for contributors and third parties are consulting, maybe support and hosting and depending on the license, charging for product extensions.

Open Source Contributions (Compiere ERP)

In this second part of the series, I will discuss what options Compiere has to go forward as an open source product and what prerequisites there are for building a thriving community. The indication for an active community are (user) contributions.  In this blog, I will cover why people contributed to Compiere and why not.

In the first part of this blog series, I mentioned that one cause for the diminishing open source community for Compiere was the business model.  Compiere started out as free product with revenue generation via services and evolved to a free open source trial/entry product with "real" commercial product and services (Open Core).  As mentioned this model only causes conflicts with the community and also customers as they see it as nothing else than a free trial/entry product with restricted functionality or access with the ultimate goal being to 'upgrade to a paid or enterprise version. This 'try before you buy' method is today quite common in non-open source software products, so no advantage for using open source anymore.

One of the biggest assets of an open source product is a thriving community.  As a user, you are not restricted to the vendor as source for information and help.  Building an active community is not easy and depends on people contributing.

Contributions today

Contributions are the major aspect of open source.  The main areas of contributions are support, documentation, testing and functional improvements.

One of the origins came from the lack of (timely) support from the original vendor, so users helped each other.  For some time, contributions were just found in open source projects, but today this is no longer true.

Commercial products like SAP and Salesforce have a very active user community and in both cases, you get your question answered probably much faster if you use the support forums then via the formal technical support.  Also most product's documentation is provided as Wiki, so that users can make comments and with that contribute to the quality of the documentation.  In many cases, commercial companies also now let their users vote on "ideas" (functional improvements) and bug priority.  The community of users have always been 'testers' by reporting bugs, and many companies now include customers in focus groups.

So, the only unique domain of contributions left for open source are code contributions  (with the restriction that if you get the source as part of the commercial product, companies may also get suggested bug fixes).

Compiere Open Source failed?

Recently, Consona acquired Compiere.  Is this a failure of Open Source business model? What decisions led to the current situation?  In this first chapter of a three part blog series, I will provide some details and insight into the inner workings of commercial open source companies.

In the open source environment, many business models have been tried.  In the Compiere environment (including the forks like Open Bravo and Adempiere) different models were put into practice.  One of the crucial aspects in open source is inbound marketing. Long before inbound marketing became fashionable, the successful open source projects used this approach to gain momentum.

The blog concentrates on open source business (application) software with it's special challenges, but the lessons learned also apply to infrastructure and tool open source projects.   

Adempiere failure - the chance for Consona to revitalize Compiere

The Compiere troublemaker and Adempiere leader "red1" (Redhuan D Oon - @red1Oon) resigned: "I have quit as 'leader of ADempiere' . I have enough after nearly 4 years of battles. Anyway the legend is born. It shall have to die now." I have to say that it is not too surprising. The Compiere fork Adempiere had pure monetary motivations (despite singing the "open source song") and it did not work out for the community. 

In my upcoming blog series, I will elaborate on the motivation for the Adempiere guys to fork and why they failed.  Due to the recent purchase of Compiere, I had quite a few discussions with people interested in a revival of Open Source ERP.  Maybe Consona sees that as an option too.

Open Source ERP has a future. The "competing" open source products are quite weak compared with Compiere - maybe it is time for a new start where the objective is to create a great product to compete against the commercial ERP applications and frameworks.  The open source community also became more mature - with little support for "troublemakers" and the need for technical and business leaders.

Compiere from the beginning to Consona

I am in the process of creating a very detailed three part blog about Compiere history and potential future:

1. The Business of Open Source - from the early Compiere days until today
2. Open Source Community and Contribution for Business Applications - my experience with creating the most successful open source business application and lessons learned.
3. Open Source ERP - a technical review of options then and today.

It will take me a few days to complete it and receive/include some feedback and validation I requested.

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