Q&A: The Maturing Open Source Model

To address BI costs, many enterprises turn to open source. We compare the many different open source models to help you find the one that's right for you.

One way to address cost issues with business intelligence software is through open source software, but there are clear differences between free open source and commercial open source. These differences are becoming more defined as open source software matures and gains popularity.

For a primer on the different models of open source being offered in BI, and their advantages and disadvantages compared to commercial BI software, we turned to Scott Barnett, co-founder and chief operations officer of Bluenog Software. Barnett is an industry veteran with 20 years of experience in the software industry at both established companies and startups. He also serves as marketing chair of the Open Solutions Alliance (OSA).

BI This Week: Studies show that BI is still a growth area within IT spending, despite the continuing economic downturn. Why is that, and what does open source software bring to the table in today's economy?

Scott Barnett: BI has always been important, but in good times, executives can afford to rely more on "gut feel" to make strategic decisions. In this economy, it's imperative that business executives make good decisions -- not based on anecdotal data but on hard facts. The only way to do this is by crunching numbers, reviewing metrics, and considering historical data. Doing this has brought the issue of BI to the forefront.

Traditionally, there has been some doubt about the cost of large BI projects relative to the return. Given that data warehouses can take years -- and millions of dollars -- to build, the results need to yield greater savings than the development costs. Open source has brought a new cost structure to BI, allowing people to dip their toes into the BI waterfront before they dive in. These tools have many of the features and much of the functionality of more established proprietary vendors.

They also allow customization with ease. This is a major need in the BI marketplace -- there is perhaps no other sector in IT that requires as much customization, so it's no surprise that the market has reacted favorably to a trend that leads to lower acquisition costs and higher flexibility.

When we talk about open source, how do you define the term "commercial open source"? It's a phrase that's often used in different ways.

Commercial open source, or COS, can be interpreted in a number of different ways. At the highest (and simplest) level, COS is characterized by a company that leverages open source in some way and packages it for commercial use. This includes providing support, documentation, and typically a customized service-level agreement (SLA).

There are many different ways to establish this -- a common method is to provide an "open core" license for free open source software, and an enterprise license for the commercial version. Another popular method is for a company to create a commercial product that is based on one or more open source projects and offer it via a commercial SLA.

What's interesting is that many open source companies do not provide the source code in their enterprise version, so from a licensing perspective, it begins to look a lot like the traditional enterprise software model. The main difference is that there is still a community behind the majority of commercial open source products out there.

It's important to understand what type model you're getting when you evaluate COS because everything from customer support to contract terms will be impacted. (Of course, the most important aspect is whether the software solves your business problem!) We are seeing a blurring of the lines around COS. Some firms will take the best of free open source software (FOSS) terms and combine them with traditional commercial terms. That creates a hybrid licensing model that gives end users the type of support they are used to, along with "one throat to choke," which they've come to expect. That hybrid model also gives the developer the power, control, and flexibility that they enjoy with FOSS, such as access to the source code and the community.

What are some advantages, and disadvantages, to COS compared to commercial software?

As I mentioned earlier, COS is starting to look more like traditional commercial software, but with a few major differences. First, the cost of COS will be significantly less than commercial software because the community is responsible for building some portion of the product. This means the savings in development costs can be delivered directly to the end user.

Also, COS generally tends to offer more flexible pricing options than commercial software. We typically see 9-to-5 and 24x7 support as separate options with COS (with variable price points for each), while commercial vendors tend to make 24x7 support the "default" option -- meaning you can't pay less if you only require 9-to-5 support. Some COS vendors also provide the source code, which can be a major advantage because it eases integration headaches -- a large and growing problem in IT.

Of course, commercial software has had major advantages as well -- most commercial packages come with extensive documentation, training, and infrastructure, and a guarantee that the company (as long as it stays in business) will provide a certain level of support. COS is approaching this level of maturity, but it isn't there yet. There is also the simple advantage of having years of improvements and features that cannot be duplicated in a short time.

Let's compare COS to non-commercial, or free, open source. What are some pluses and minuses there?

The real value of COS compared to FOSS is the support aspect. It's become apparent that licensing models are important, but having that single vendor in the event of a problem is the real value of COS. We talk all the time about how FOSS is a fantastic example of sweat equity at work -- your employees will spend more of their own time working with and getting FOSS operational, and most of the aspects around an enterprise software project need to be handled in-house. There is absolutely no guarantee on the quality or quantity of documentation, third-party support, or the reliability of FOSS.

That doesn't mean that FOSS isn't quality -- in fact, many surveys have shown a much lower defect rate in FOSS compared to commercial software. However, most companies see the value in paying somebody else for their expertise so the core team can focus on the main business value -- and this proposition doesn't change when considering FOSS vs. COS. If a company wants to invest in technology that they are not expert in and doesn't want to pay internal people to become experts, then you trade the "sweat equity" for actual capital to move faster.

At Bluenog, you've bundled a BI solution with both portal and content management software. What's the thought behind that combination?

Bluenog ICE (Integrated Collaborative Environment) solves integration problems. Most enterprise applications built today require CPR (Content, Presentation, and Reporting), which has traditionally been solved by acquiring different best-of-breed products and manually integrating them -- a challenge at best.

Bluenog ICE keeps costs low by using popular and well-known open source CMS, open source portal, and open source BI projects (primarily from Apache and Eclipse). We have spent significant effort building a core platform for these projects that delivers features such as single sign-on, workflow, centralized administration and deployment, support for wikis, calendaring, rich Internet applications (RIAs), and an integration framework to connect with legacy applications such as ERP/CRM, external Web services, and other legacy data.

This allows for rapid out-of-the-box creation of enterprise applications with minimal integration costs. The acquisition costs of ICE are dramatically lower than either buying best-of-breed or manually trying to build these integration hooks yourself.