In the world of commercial open source, there is plenty of room for both point solution providers and cloud providers. But they are competing for the same customers, and the competitive battlefield is expanding to the nuanced world of software licensing. By changing their licenses, open source projects like Kafka, MongoDB, and Redis can prohibit AWS from certain usage patterns. This might offer some protection for companies based around the point solutions–companies like Confluent and RedisLabs.
Beyond the fracas of the battle between cloud providers and point solutions, there are newer open source companies with models that do not fit tightly into any historical business models. HashiCorp makes a suite of differentiated open source tools that have not been seriously contested or offered as a service by cloud providers. GitLab makes an open source platform that is built with monitoring, logging, CI, and code hosting out of the box.
As the world of open source business models expands, more companies will find opportunity in open sourcing the code that runs their products. In many cases, they will find that it strengthens their advantage rather than weakens it. The defensibility of many businesses relies more on data and network effects than the contents of the codebase. We may see the default question gradually shift from “why should I open source my codebase?” to “why shouldn’t I open source my codebase?”
Mike Volpi is a partner at Index Ventures and has invested in many open source businesses over the last decade. He is on the board of Confluent, Cockroach Labs, Kong, and Elastic. Mike joins the show to share his perspective on open source business models of the past, present, and future.
