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Business by open-source manners – Jose Teixeira Apr 2013
Business by open-source manners
                      =

       1- Open-Source Software 4 Startups
                      +
   2-Starting an Open-Source Software Business




                                             Jose Teixeira
Schedule:
18:00 - 18:10 Opening words
18:10 - 18:30 Open Source Software solutions for startups
18:30 - 18:50 How to venture into an open-source business?
18:50 - 19:00 Discussion about Open Source Software in business.
19:00 --> Snacks, Drinks, Networking, Chatting


Presenter:
Jose Teixeira
“Disposable”¹ Researcher
Information Systems Science
University of Turku

Jose.Teixeira@utu.fi
www.jteixeira.eu



                                                         Jose Teixeira
International
      DHL
UTU              Open-source
   Retail
                   Triathlon
        Immit
                Portugal Tesco
Sonae
          Computer science
   IT
          Boost       Finland
Nokia
            Airbus
                      Research
        Debian
TSE
            Software
   EU Orienteering anti-
                   ACTA
Startups

                  Jose Teixeira
Business by open-source manners
                      =

       1- Open-Source Software 4 Startups
                      +
   2-Starting an Open-Source Software Business




                                             Jose Teixeira
Open-source software for startups

1) What is Open-Source? What is not Open-
  Source?
2) Why it matters? 4 startups?
3) Contrasting open-source with commercial
  software.
4) Open-source solutions for small business
  problems.
5) “To checklist” of Open-Source Software 4
  startups.
                                        Jose Teixeira
OSS? What?



Free != free




               Jose Teixeira
OSS? What?




Free as in freedom not as in beer




                              Jose Teixeira
Free != Free       OSS? What?




               Jose Teixeira
OSS? What?




Jose Teixeira
OSS? What?
Free != Free




               Jose Teixeira
OSS? What?




An analogy with Tangram




                          Jose Teixeira
OSS? What?




Open-source vs closed-source




                          Jose Teixeira
OSS? What?




Open-source vs closed-source




                          Jose Teixeira
OSS? What?




Open-source vs closed-source




                          Jose Teixeira
OSS? What?




FSF four freedoms




                    Jose Teixeira
OSS? What?




OSI open-source definition




                             Jose Teixeira
OSS? What?




FLOSS licensing




                  Jose Teixeira
OSS? What?




         My open-source definition
Availability of the blueprint (source code)
Standard compliance
Absence of lock-in mechanims            Source: Teixeira 2011




                                       Jose Teixeira
OSS? What is not?




         What open-source is not:

➔
 Freeware
➔
 Shareware
➔
 Shared-source
➔
 Co-creation
➔
 Participatory design
➔
 Crowd-sourcing



                                    Jose Teixeira
OSS? Why?




Jose Teixeira
OSS? Why?




Jose Teixeira
OSS? Why?




     Most important enablers of high-tech
             entrepreneurship?

1- Open-source software
2- Affordable cloud computing services
3- Social networking graphs for viral marketing


Source: Interviews with entrepreneurs by Jose Teixeira @ http://www.startupday.se/
2012




                                                                                     Jose Teixeira
OSS? Why?




Finnish high-tech startups and open-source

1- 19/20 claim to use open-source software;
2- 4/20 claim to offer open-source components;
3- 2/20 plan to offer open-source components;
4- 11/20 claim to work up-stream;



 Source: Interviews with 20 Startups at Slush 2011
 Presented by Jose Teixeira and Joni Salminen at ICCE 2012 conference




                                                                        Jose Teixeira
Contrast!




Jose Teixeira
Contrast!




Jose Teixeira
Contrast!




Jose Teixeira
Contrast!




Jose Teixeira
Contrast!




Software pricing (i.e. ERP)




                   source: pemeco

                                    Jose Teixeira
Contrast!




Software pricing (i.e. ERP)




        License costs


     Implementations costs


     Maintenance costs

                              Jose Teixeira
Solutions :)




    Classical OSS infrastructure supporting
         common business problems

    Desktop PC's

    E-mail

    Group-ware

    Customer relationship management

    Finance

    Document management

    Disaster recovery

    Security

    Web-servers                        Source: http://www.linuxjournal.com/article/7825


                                                  Jose Teixeira
Solutions :)




A book on OSS infrastructure




      Available from UTU e-library at http://site.ebrary.com/lib/uniturku/docDetail.action?docID=10061218


                                                                         Jose Teixeira
Solutions :)




But OSS infrastructure can go much beyond

ERP
E-commerce
Analytics
VoIP telephony




                                 Jose Teixeira
+ OSS offers thousands of components in
public domain for business R&D initiatives




                                  Jose Teixeira
To know more ...




                   Jose Teixeira
END part 1




             Jose Teixeira
Business by open-source manners – Jose Teixeira Apr 2013
                                       Jose Teixeira
Business by open-source manners
                      =

       1- Open-Source Software 4 Startups
                      +
   2-Starting an Open-Source Software Business




                                             Jose Teixeira
Outline

Intro
OSS licenses
OSS business models
OSS entrepreneurial business modeling




                                        Jose Teixeira
Intro




You don't need to to create or work on a OSS
      organization to work with OSS;
             TOP 10 Linux Kernel Contributors




              Source: http://go.linuxfoundation.org/who-writes-linux-2012

                                                                            Jose Teixeira
Intro




You don't need to be an OSS company to contribute
     and be respected in the OSS community




                                       Jose Teixeira
Intro




A) Based in part on the work of the
Independent JPEG group
B) Use zlib by Jean-loup Gailly and
Mark Adler
C) Based on the work of the FFmpeg
project under the LGPL 2.1 license




                                      Jose Teixeira
IP




                             Protect your IP

•
     Very often does not work for startups
•
     But with OSS you are creating prior art
    The Håkan Lans case:

    * Swedish inventor of a satellite navigation system, the computer mouse, colour
    graphics systems in computer displays and many other inventions

    US patents:
    * Arrangement for producing a pattern on a light-sensitive surface
    * Color graphics processor
    * Position indicating system



                                                                         Jose Teixeira
IP




 Legal terminology


        Copyright
       Trademarks
         Patents
Intellectual Property (IP)
      Trade secrets



                             Jose Teixeira
IP




 Legal terminology


        Copyright
       Trademarks
         Patents
Intellectual Property (IP)
      Trade secrets



                             Jose Teixeira
IP




FLOSS licensing




                  Jose Teixeira
IP




Permissive




             Jose Teixeira
IP




Copyleft




           Jose Teixeira
IP




                                           ISC license

Copyright (c) Year(s), Company or Person's Name <E-mail address>


Permission to use, copy, modify, and/or distribute this software for any purpose with or without fee is hereby
granted,
provided that the above copyright notice and this permission notice appear in all copies.


THE SOFTWARE IS PROVIDED "AS IS" AND THE AUTHOR DISCLAIMS ALL WARRANTIES WITH REGARD TO
THIS SOFTWARE INCLUDING ALL IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS. IN NO EVENT
SHALL THE AUTHOR BE LIABLE FOR ANY SPECIAL, DIRECT, INDIRECT, OR CONSEQUENTIAL DAMAGES OR
ANY DAMAGES WHATSOEVER RESULTING FROM LOSS OF USE, DATA OR PROFITS, WHETHER IN AN
ACTION OF CONTRACT, NEGLIGENCE OR OTHER TORTIOUS ACTION, ARISING OUT OF OR IN CONNECTION
WITH THE USE OR PERFORMANCE OF THIS SOFTWARE.




                                                                                            Jose Teixeira
IP




           FLOSS licensing once again




Credit the community        Contribute to the community

                                          Jose Teixeira
IP




Jose Teixeira
IP




             Complicated Open-Source licenses?

Check then:
http://www.microsoft.com/licensing/
http://www.oracle.com/us/corporate/contracts/license-service-agreement/index.html
http://www.sap.com/corporate-en/our-company/agreements/western-europe/index.epx




After hours and thousands or pages you are done. But no worries there
are books, vendors, lawyers and consultants that will understand it for
you.




                                                                                    Jose Teixeira
Business Models




       11 open-source business models
Subscription Model
Offering Commercial and Open Source Products
Support and Training Model
Dual License Model
Hosted Service
Advertising Model
Commercial Enhancement
Embedding Model
Consulting and Integration Strategy
                                     source: Wasserman 2009
Patronage Model

                                                      Jose Teixeira
Business Models




1- Commercial and open-source products




                              Source: Wasserman 2012




                                Jose Teixeira
Business Models




2 - Subscription model




                    Source: Wasserman 2012




                            Jose Teixeira
Business Models




3 - Consulting




                 Source: Wasserman 2012




                  Jose Teixeira
Business Models




4 - Support and training model




                        Source: Wasserman 2012




                                  Jose Teixeira
Business Models




5 - Hosted service




                     Source: Wasserman 2012



                               Jose Teixeira
Business Models




6 – Dual license




                   Source: Wasserman 2012



                             Jose Teixeira
Business Models




7 - Commercial enhancement




                     Source: Wasserman 2012


                               Jose Teixeira
Business Models




8 - Advertising




                  Source: Wasserman 2012


                            Jose Teixeira
Business Models




8 - Patronage




                Source: Wasserman 2012

                          Jose Teixeira
Business Models




10 - Hardware




                Source: Wasserman 2012

                          Jose Teixeira
Business Models




11 – Platform / Eco-system




                             Jose Teixeira
Business Models




                     To know more


Tony Wasserman works
COSS.fi - Avoimien tietojärjestelmien keskus COSS ry
Economic aspects and business models of Free Software by
  Free Technology Academy




                                                Jose Teixeira
OSS Business Modeling




      Jose Teixeira
OSS Business Modeling




1st we took Osterwalder, A., and Y. Pigneur. Business Model Generation: A Handbook for
Visionaries, Game Changers, and Challengers. Wiley, 2010. The popular business “canvas”

                                                                          Jose Teixeira
OSS Business Modeling




We took also Sawy, O. A. E., and F Pereira. Business Modelling in the Dynamic Digital Space: An
Ecosystem Approach. Springer, 2013. A business modelling framework for IT industry.

                                                                            Jose Teixeira
OSS Business Modeling




3rd – We combined them … test it with business cases


                                                             Jose Teixeira
OSS Business Modeling




4th – We add OSS academic literature driven components on it … and test it again
                                                                    Jose Teixeira
OSS Business Modeling




      Jose Teixeira
OSS Business Modeling




      Jose Teixeira
OSS Business Modeling




      Jose Teixeira
OSS Business Modeling




      Jose Teixeira
OSS Business Modeling




      Jose Teixeira
OSS Business Modeling




      Jose Teixeira
OSS Business Modeling




      Jose Teixeira
OSS Business Modeling




      Jose Teixeira
OSS Business Modeling




      Jose Teixeira
OSS Business Modeling




      Jose Teixeira
OSS Business Modeling




      Jose Teixeira
OSS Business Modeling




      Jose Teixeira
OSS Business Modeling




      Jose Teixeira
Exercise: The PickRide case

http://www.youtube.com/watch?v=omcA5DN97jE
   How could it be made by FLOSS manners?




                                  Jose Teixeira
END




      Jose Teixeira

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Business by open source manners turku april 2013

  • 1. Business by open-source manners – Jose Teixeira Apr 2013
  • 2. Business by open-source manners = 1- Open-Source Software 4 Startups + 2-Starting an Open-Source Software Business Jose Teixeira
  • 3. Schedule: 18:00 - 18:10 Opening words 18:10 - 18:30 Open Source Software solutions for startups 18:30 - 18:50 How to venture into an open-source business? 18:50 - 19:00 Discussion about Open Source Software in business. 19:00 --> Snacks, Drinks, Networking, Chatting Presenter: Jose Teixeira “Disposable”¹ Researcher Information Systems Science University of Turku Jose.Teixeira@utu.fi www.jteixeira.eu Jose Teixeira
  • 4. International DHL UTU Open-source Retail Triathlon Immit Portugal Tesco Sonae Computer science IT Boost Finland Nokia Airbus Research Debian TSE Software EU Orienteering anti- ACTA Startups Jose Teixeira
  • 5. Business by open-source manners = 1- Open-Source Software 4 Startups + 2-Starting an Open-Source Software Business Jose Teixeira
  • 6. Open-source software for startups 1) What is Open-Source? What is not Open- Source? 2) Why it matters? 4 startups? 3) Contrasting open-source with commercial software. 4) Open-source solutions for small business problems. 5) “To checklist” of Open-Source Software 4 startups. Jose Teixeira
  • 7. OSS? What? Free != free Jose Teixeira
  • 8. OSS? What? Free as in freedom not as in beer Jose Teixeira
  • 9. Free != Free OSS? What? Jose Teixeira
  • 11. OSS? What? Free != Free Jose Teixeira
  • 12. OSS? What? An analogy with Tangram Jose Teixeira
  • 13. OSS? What? Open-source vs closed-source Jose Teixeira
  • 14. OSS? What? Open-source vs closed-source Jose Teixeira
  • 15. OSS? What? Open-source vs closed-source Jose Teixeira
  • 16. OSS? What? FSF four freedoms Jose Teixeira
  • 17. OSS? What? OSI open-source definition Jose Teixeira
  • 18. OSS? What? FLOSS licensing Jose Teixeira
  • 19. OSS? What? My open-source definition Availability of the blueprint (source code) Standard compliance Absence of lock-in mechanims Source: Teixeira 2011 Jose Teixeira
  • 20. OSS? What is not? What open-source is not: ➔ Freeware ➔ Shareware ➔ Shared-source ➔ Co-creation ➔ Participatory design ➔ Crowd-sourcing Jose Teixeira
  • 23. OSS? Why? Most important enablers of high-tech entrepreneurship? 1- Open-source software 2- Affordable cloud computing services 3- Social networking graphs for viral marketing Source: Interviews with entrepreneurs by Jose Teixeira @ http://www.startupday.se/ 2012 Jose Teixeira
  • 24. OSS? Why? Finnish high-tech startups and open-source 1- 19/20 claim to use open-source software; 2- 4/20 claim to offer open-source components; 3- 2/20 plan to offer open-source components; 4- 11/20 claim to work up-stream; Source: Interviews with 20 Startups at Slush 2011 Presented by Jose Teixeira and Joni Salminen at ICCE 2012 conference Jose Teixeira
  • 29. Contrast! Software pricing (i.e. ERP) source: pemeco Jose Teixeira
  • 30. Contrast! Software pricing (i.e. ERP) License costs Implementations costs Maintenance costs Jose Teixeira
  • 31. Solutions :) Classical OSS infrastructure supporting common business problems  Desktop PC's  E-mail  Group-ware  Customer relationship management  Finance  Document management  Disaster recovery  Security  Web-servers Source: http://www.linuxjournal.com/article/7825 Jose Teixeira
  • 32. Solutions :) A book on OSS infrastructure Available from UTU e-library at http://site.ebrary.com/lib/uniturku/docDetail.action?docID=10061218 Jose Teixeira
  • 33. Solutions :) But OSS infrastructure can go much beyond ERP E-commerce Analytics VoIP telephony Jose Teixeira
  • 34. + OSS offers thousands of components in public domain for business R&D initiatives Jose Teixeira
  • 35. To know more ... Jose Teixeira
  • 36. END part 1 Jose Teixeira
  • 37. Business by open-source manners – Jose Teixeira Apr 2013 Jose Teixeira
  • 38. Business by open-source manners = 1- Open-Source Software 4 Startups + 2-Starting an Open-Source Software Business Jose Teixeira
  • 39. Outline Intro OSS licenses OSS business models OSS entrepreneurial business modeling Jose Teixeira
  • 40. Intro You don't need to to create or work on a OSS organization to work with OSS; TOP 10 Linux Kernel Contributors Source: http://go.linuxfoundation.org/who-writes-linux-2012 Jose Teixeira
  • 41. Intro You don't need to be an OSS company to contribute and be respected in the OSS community Jose Teixeira
  • 42. Intro A) Based in part on the work of the Independent JPEG group B) Use zlib by Jean-loup Gailly and Mark Adler C) Based on the work of the FFmpeg project under the LGPL 2.1 license Jose Teixeira
  • 43. IP Protect your IP • Very often does not work for startups • But with OSS you are creating prior art The Håkan Lans case: * Swedish inventor of a satellite navigation system, the computer mouse, colour graphics systems in computer displays and many other inventions US patents: * Arrangement for producing a pattern on a light-sensitive surface * Color graphics processor * Position indicating system Jose Teixeira
  • 44. IP Legal terminology Copyright Trademarks Patents Intellectual Property (IP) Trade secrets Jose Teixeira
  • 45. IP Legal terminology Copyright Trademarks Patents Intellectual Property (IP) Trade secrets Jose Teixeira
  • 46. IP FLOSS licensing Jose Teixeira
  • 47. IP Permissive Jose Teixeira
  • 48. IP Copyleft Jose Teixeira
  • 49. IP ISC license Copyright (c) Year(s), Company or Person's Name <E-mail address> Permission to use, copy, modify, and/or distribute this software for any purpose with or without fee is hereby granted, provided that the above copyright notice and this permission notice appear in all copies. THE SOFTWARE IS PROVIDED "AS IS" AND THE AUTHOR DISCLAIMS ALL WARRANTIES WITH REGARD TO THIS SOFTWARE INCLUDING ALL IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS. IN NO EVENT SHALL THE AUTHOR BE LIABLE FOR ANY SPECIAL, DIRECT, INDIRECT, OR CONSEQUENTIAL DAMAGES OR ANY DAMAGES WHATSOEVER RESULTING FROM LOSS OF USE, DATA OR PROFITS, WHETHER IN AN ACTION OF CONTRACT, NEGLIGENCE OR OTHER TORTIOUS ACTION, ARISING OUT OF OR IN CONNECTION WITH THE USE OR PERFORMANCE OF THIS SOFTWARE. Jose Teixeira
  • 50. IP FLOSS licensing once again Credit the community Contribute to the community Jose Teixeira
  • 52. IP Complicated Open-Source licenses? Check then: http://www.microsoft.com/licensing/ http://www.oracle.com/us/corporate/contracts/license-service-agreement/index.html http://www.sap.com/corporate-en/our-company/agreements/western-europe/index.epx After hours and thousands or pages you are done. But no worries there are books, vendors, lawyers and consultants that will understand it for you. Jose Teixeira
  • 53. Business Models 11 open-source business models Subscription Model Offering Commercial and Open Source Products Support and Training Model Dual License Model Hosted Service Advertising Model Commercial Enhancement Embedding Model Consulting and Integration Strategy source: Wasserman 2009 Patronage Model Jose Teixeira
  • 54. Business Models 1- Commercial and open-source products Source: Wasserman 2012 Jose Teixeira
  • 55. Business Models 2 - Subscription model Source: Wasserman 2012 Jose Teixeira
  • 56. Business Models 3 - Consulting Source: Wasserman 2012 Jose Teixeira
  • 57. Business Models 4 - Support and training model Source: Wasserman 2012 Jose Teixeira
  • 58. Business Models 5 - Hosted service Source: Wasserman 2012 Jose Teixeira
  • 59. Business Models 6 – Dual license Source: Wasserman 2012 Jose Teixeira
  • 60. Business Models 7 - Commercial enhancement Source: Wasserman 2012 Jose Teixeira
  • 61. Business Models 8 - Advertising Source: Wasserman 2012 Jose Teixeira
  • 62. Business Models 8 - Patronage Source: Wasserman 2012 Jose Teixeira
  • 63. Business Models 10 - Hardware Source: Wasserman 2012 Jose Teixeira
  • 64. Business Models 11 – Platform / Eco-system Jose Teixeira
  • 65. Business Models To know more Tony Wasserman works COSS.fi - Avoimien tietojärjestelmien keskus COSS ry Economic aspects and business models of Free Software by Free Technology Academy Jose Teixeira
  • 66. OSS Business Modeling Jose Teixeira
  • 67. OSS Business Modeling 1st we took Osterwalder, A., and Y. Pigneur. Business Model Generation: A Handbook for Visionaries, Game Changers, and Challengers. Wiley, 2010. The popular business “canvas” Jose Teixeira
  • 68. OSS Business Modeling We took also Sawy, O. A. E., and F Pereira. Business Modelling in the Dynamic Digital Space: An Ecosystem Approach. Springer, 2013. A business modelling framework for IT industry. Jose Teixeira
  • 69. OSS Business Modeling 3rd – We combined them … test it with business cases Jose Teixeira
  • 70. OSS Business Modeling 4th – We add OSS academic literature driven components on it … and test it again Jose Teixeira
  • 71. OSS Business Modeling Jose Teixeira
  • 72. OSS Business Modeling Jose Teixeira
  • 73. OSS Business Modeling Jose Teixeira
  • 74. OSS Business Modeling Jose Teixeira
  • 75. OSS Business Modeling Jose Teixeira
  • 76. OSS Business Modeling Jose Teixeira
  • 77. OSS Business Modeling Jose Teixeira
  • 78. OSS Business Modeling Jose Teixeira
  • 79. OSS Business Modeling Jose Teixeira
  • 80. OSS Business Modeling Jose Teixeira
  • 81. OSS Business Modeling Jose Teixeira
  • 82. OSS Business Modeling Jose Teixeira
  • 83. OSS Business Modeling Jose Teixeira
  • 84. Exercise: The PickRide case http://www.youtube.com/watch?v=omcA5DN97jE How could it be made by FLOSS manners? Jose Teixeira
  • 85. END Jose Teixeira