After spending time last week at the OpenStack Summit I have been thinking about how solutions based on open source technologies compete. I have categorized the open source communities into two categories:
- Market Competition – in this community the companies formed around the technology compete directly against each other for the same customer base
- Market Separation- in this community the companies formed around the technology sell to various segmented markets with limited direct competition
There are plenty of market separation communities in existence and I will detail two to provide a better understanding:
- Linux Distributions – the most familiar of open source projects is prominently led by a few market leaders; SUSE, Red Hat, and Canonical/Ubuntu. Each of these three solutions primarily target different segments; SUSE – Microsoft enterprises looking for Linux solutions; Red Hat – Linux enterprise IT organizations; Ubuntu – general open source users, primarily clients. Thus, limited direct competition.
- Xen.org – this hypervisor technology is primarily used by Oracle and Citrix in production. Oracle targets their customer base looking to virtualize their database solutions and Citrix primarily uses Xen for their customers as the behind the scenes virtualization platform. Thus, limited direct competition.
As for market competition communities I highlight two well-known groups, OpenStack and Cloud Foundry.
- Cloud Foundry – all the solutions based on this technology will compete directly against each other as I am unable to determine how they are reaching different customers. A debate on this issue was recently blogged b/w Apprenda and AppFog ( post1 and post2)
- OpenStack –this community currently has more than 10 distributions with more coming and I am unable to determine how they plan to reach various customer markets. The current marketing is putting each of these companies in direct competition to each other.
These two communities are a relative new idea in open source where companies come together, share resources, and then compete directly with each other. I find this direct competition aspect to be most interesting and am unsure how this will play out. My confidence level is not high for the majority of players as I expect one winner in each community to emerge thus causing the collapse of the ecosystem.
So, what are your thoughts? Do you agree? Am I missing another open source community example that demonstrates how market competition works? Can’t wait for some feedback.