OSBC Panel Considers Innovation

 May 21, 2012, Open Source Business Conference, San Francisco—A panel moderated by Michael Skok from North Bridge Venture Partners looked at the issues affecting the future of open source. The panel considered innovation as a driver for the industry. Panel members included Tim Yeaton from Black Duck Software, Tom Erickson from Acquia, Ryan Gardner from Warner Music Group, and Gil Yehuda from Yahoo.

Skok referenced a survey that indicated over 75 percent of the 740 respondents deployed open source code. This survey comprised of 41 percent vendors and 59 percent users and represented a mix of people in all areas within their companies.
Erickson observed that open source 2.0 has changed business models by increasing the technology and flexibility in operations. For example, the NYSE invested over $10 M over time in software and hardware. Recently, the CIO wanted to know how long it would take his vendor to change a menu. The vendor responded about 3 months, compared to about 3 hours for the same level of change in Druple.

Vendors versus users?
Garner responded that technology is a challenge. The software doesn’t run itself, but the ability to address the software as a user is not a big business driver.
Yehuda added that users need control of their environment. There is a slow shift as owning the code is not the same as flexibility. The underlying community is faster and better than a proprietary solution.
Yeaton noted that currently, enterprises use less than 30 percent of open source code. All companies are considering and over half will consider open source for production apps in the future. This is a strategic, 5-year plan.

Trends? Communities, enterprise, requirements, non-technical industries. Adoption in the non-technical areas is higher than in the technical ones, 42 percent versus 40.
Garner offered providers are more mature now, which helps the adoption. The issues for enterprises include security, scale, etc. The access to source code now is now possible from many vendors.
Yehuda added that enterprise adoption influences non-technical users. The open source community provides technology to the non-technical users. Media and digital companies need to accept the technologies and hire IT or go open source if they plan to keep up in the technology battles. Open source equates to not being locked into a vendor. This aspect will change and grow over time.

Within enterprises, the big companies, those with over 1,000 people, are the largest adopters. They find the quality attractive.?
Erickson responded that all of the Fortune 10 have web operations on open source. Pharmaceutical firms have 100’s of sites to manage in order to drive engagement with consumers. Garner said, for Warner, open source offers quality and freedom from vendor lock in.
Yeaton likes open source because you don’t need to develop your own IT and there are little migration costs. They use a mixture of staff and open source platforms. SaaS is ok for taking in information in a custom environment and moving it to open source.

Barriers? Unfamiliar, and lack of internal skills.
Garner noted that software now requires a strategic view. The challenge is not the technology, but the ability to navigate the abundance of apps. Users need ways to find and use open source, standards, and best practices. Increased familiarity is helping companies understand and use the open source capabilities. Enterprise users still develop apps from scratch for high replication apps.

Industries impacted by open source: health, automotive, aero, retail, data management, and financial markets and companies?
Yehuda suggested that open source companies have to compete head-to-head with companies with deep pockets. Open source is mostly used where a company has to keep stuff running and current.
Erickson added that Facebook is completely open source.

Health?
Yehuda noted that the VA is the organization with the largest investment in open source. They have to handle big data and need fully secure and available software.
Garner added that government and health care are investing a lot into R&D for things like electronic records and health management.

The number of projects is up by a factor of 10. Open source represents over 100B lines of code and 10M man-years of work?
Erickson stated that innovation in a lot of areas is in the fringes. Open source communities solve problems through accessibility. The communities innovate to solve personal problems through crowd sourcing.

Business models are changing from a b-b to b-c?
Yeaton responded that they dabbled with open source. They mostly have proprietary software in use, however, a number of vendors could not offer the components and services they needed. Now service providers exist to provide help and can start up on any new project in open source. The open source community has many more people in development than the vendors.
Garner appended that the number of people in open source development is equal to over $1T in usable assets.
Yehuda objected, noting that the number of people and number of projects are more of a code dump. There are few real projects in place now. The increase in projects is not the same as the number of successful projects, it is some small percentage.

Open source struggles to offer support. Are value-added subscription services and SaaS the answer? Is the key project maturity?
Yeaton answered that a number of vendors exist and maturity is important.
Garner offered that there is a super community in the marketplace. For example, automotive has a 59 percent penetration and an additional 35 percent are evaluating. Open source tools are needed to generate the next generation apps. The auto industry is trying to move from a 7 year design cycle to less than 2 years, to address the need for rapid upgrades to subsystems during the life of the car.

Health going virtual. New projects are in the cloud, mobile, and mobile enterprise apps?
Yehuda said that the health industry is consuming and creating 50TB a day. These data are computed and refreshed constantly. The industry needs the cloud to reduce the cost of operations and has to build their data on top of cloud hardware.

Analytics, mobile, and enterprise?
Garner considered that the underlying infrastructure allows easy deployment. The business model for services on open source enables free software distribution. Warner uses open source software and the cloud which enable them to handle traffic spikes by scaling in real time.

Future growth?
Garner offered that many companies have crossed the threshold into enterprise apps. Quality matters and good quality will accelerate adoption.
Erickson added that growing adoption of infrastructure and apps facilitates moves to the mainstream. International adoption is growing in Japan, Asia, and Europe. Open source reduces investments and operating costs.
Yeaton surmised that enterprise customers are starting to reward the companies that are offering more open source software. The ease of transitions and the existence of open stack and services is helping.
Yehuda noted that they will continue to invest and change the concept of IT. It is important to understand the community roadmaps and feature lists. Open source offers engagement and the ability to grow and change the nature of software. The secret is to learn how to contribute and improve the tools for all.