|By Hal Steger, Alberto Onetti||
|October 1, 2007 08:15 AM EDT||
From a commercial open source company's point-of-view, open source is ideally the ultimate in "grass roots" marketing where people learn about the project by word-of-mouth and where they volunteer their time and effort, resulting in a vibrant community that benefits the company in many ways.
While this ideal may apply to some open source projects, for the vast majority of open source companies, it is not a case of "build it and they will come." Instead, most open source companies need to understand who comprises their community so they can formulate a viable business model. In particular, they need to understand that communities consist of heterogeneous types of people, with their own interests, motivation, needs, and ability.
Open source companies need to identify the groups in their community, decide which ones to focus on, and choose the best way to work with them. This is de rigueur for determining how best to monetize the interest in their software, ideally without disrupting the community spirit that differentiates their software from proprietary offerings. This is where "old school" marketing can help. Obviously these techniques need to be adapted for open source, requiring the blending of traditional marketing techniques and community relations.
Treating a community as an undifferentiated blob can result in failure to generate sustaining revenue as well as alienation of a community. As a community is perhaps the most distinctive component of an open source company, losing its community is tantamount to failure. If the community is not properly nurtured, an open source company's potential won't be realized.
This article suggests a general approach for segmenting a community to aid in formulating a business model and marketing plan to reach a project's potential. Moreover, it uses the example of an open source company, Funambol, Inc., to provide concrete examples of how open source community programs can be effectively used.
Does Open Source Need Marketing & Segmentation?
For many (Cherkoff 2005), open source is meant to be a disruptive business model where the conventional laws of business and marketing don't apply, e.g., it's ideally meant to be the ultimate in "viral marketing" (Rushkoff 1994, Helm 2000, Skrob 2005) or "guerrilla marketing" (Levinson 1984), where only interested parties raise their hands and volunteers give their time and/or money to the cause, and where you don't need to spend much time or money on traditional marketing.
While that may be the case for some open source projects, especially those that don't need to make money, and while it may work for start-ups and early stage projects (Rosenberg 2005), established commercial open source companies need to determine how they can monetize the interest in their software, ideally without disturbing the open source philosophy that differentiates their software from commercial offerings.
This is where time-honored marketing principles and best practices apply (among the others, Baker 2000, Doyle 1998, Kotler 1999 and 2002). This means understanding your community and what makes users tick, determining their needs and interests, and formulating products and services that your organization can offer and that the community is likely to want and buy.
The most successful open source companies such as MySQL, Red Hat, SugarCRM, and Zimbra all do this to a certain extent, albeit in a stylistically different way than pure commercial companies. The sooner an open source company comes to grip with the reality that it needs to practice standard marketing techniques such as segmentation, target marketing, and direct marketing, the better it will be.
Obviously, these techniques need to be adapted and adjusted to take into account the appropriate ways to communicate and interact with open source community members, so we're talking about the blending of two disciplines, marketing and community relations.
A widespread stereotype about open source is that communities mainly consist of hardcode hackers who only contribute code. In reality, communities are comprised of many different types of people, each of whom has their own interests, motivation, needs, and ability to contribute. As a project experiences success and crosses the "chasm" between the early and mainstream stages (Moore 2002), the community is composed not only of "techies" (developers and IT people), the typical early adopters, but increasingly by non-technical people, i.e., end users looking for products and solutions. Moreover, communities are increasingly composed not of individuals but professionals who work in companies such as system integrators, OEMs, and service providers and are involved to further the business objectives of their corporations. The fact that communities have corporate members is relevant because business-to-business marketing requires a different approach than marketing to individuals/consumers.
Communities are really heterogeneous groups that need to be addressed differently: various people and segments require communication through different channels with different messages. An open source company should identify the different groups in the community, decide which ones it's going to address, and choose the best way to leverage the target groups. Community segmentation and marketing are essential for designing effective business models and actions.
The risk of unfocused actions is to de-energize the community, which could result in losing the unique competitive advantage distinguishing open source companies. The community is an open source company's primary distinctive asset and if not properly leveraged and nurtured, the "disruptive" potential (Christensen 1997) can stagnate (Onetti and Capobianco 2005). Just being open source is not itself a guarantee of success; there are plenty of companies without active communities. Anyone can go to Sourceforge and see projects that languish because of minimal community involvement; furthermore, projects are like stars, they can shine for periods of time but if they don't continuously renew their energy, they can burn out. Consider the case of a highly popular and publicized open source project such as Evolution, a one-time alternative to Outlook that has languished.
Recognizing that your community consists of several kinds of people and grouping them according to their needs and profiles has broad implications for the business model in terms of how to best work within each of these groups. This article aims to describe, through case study research, a generic approach for how commercial open source companies can segment their communities to aid in formulating a business model and marketing plan to reach their potential. It's for anyone who works in an open source company or project who's trying to determine a viable business model.
The article is structured in two parts. The first part proposes how an open source company can segment its community. In the second part we will present the experience of Funambol, a provider of open source consumer push e-mail and personal information management (PIM) synchronization. We'll describe how it segmented its community and created nurturing and leveraging open source programs.
Segmenting an Open Source Community
An open source community often consists of an assortment of people, developers, end users, IT people, ISVs, SIs, ODMs, and partners. Segmentation helps by identifying these distinct groups. One question we'll try to answer is how it's possible to segment an open source community.
Note that for this article, we broadly define the use of the term "community" to include everyone who participates in an open source community. This includes people who download project software and documentation, read or post messages to community mailing lists, visit the project Web site looking for project information, and participate in project events such as webinars. This definition of community may be different than the more narrowly defined group of hardcore developer enthusiasts but in our experience, the broader use of the term is more relevant to an open source community. Note that it doesn't necessarily include commercial customers and partners though there's likely to be some natural overlap.
A community can be segmented according to several characteristics. We could refer to demographic variables such as age and technical skills (dividing community members into "techies" and "unskilled" individuals), or psychographic characteristics such as the purpose of community involvement (separating people who operate for business purposes from individuals moved by hobby/volunteering aims). Moreover, for corporate community members, we could segment using typical B2B criteria, e.g., dividing them by company size (discerning SMEs from large corporate), location, industry and/or business type (e.g., distinguishing among service providers, system integrators, independent software vendors, device manufacturers, and so on).
|alberto onetti 04/09/08 09:41:48 AM EDT|
Hi Ross, thank you for the update about Evolution project. You provided to us a really helpful insight.
|Ross Burton 09/28/07 10:21:38 AM EDT|
"Consider the case of a highly popular and publicized open source project such as Evolution, a one-time alternative to Outlook that has languished."
This isn't really true. The Evolution project in the last six months has gained three core maintainers, and just released EDS 1.2/Evolution 2.12.
Evolution has strict time-based release cycles, releasing every six months, and my tools tell me that in the last six months there have been 2018 files changed, 395302 insertions and 214719 deletions. That doesn't look like a stagnating project to me.
Through WebRTC, audio and video communications are being embedded more easily than ever into applications, helping carriers, enterprises and independent software vendors deliver greater functionality to their end users. With today’s business world increasingly focused on outcomes, users’ growing calls for ease of use, and businesses craving smarter, tighter integration, what’s the next step in delivering a richer, more immersive experience? That richer, more fully integrated experience comes about through a Communications Platform as a Service which allows for messaging, screen sharing, video...
Sep. 2, 2015 02:00 AM EDT Reads: 687
Too often with compelling new technologies market participants become overly enamored with that attractiveness of the technology and neglect underlying business drivers. This tendency, what some call the “newest shiny object syndrome,” is understandable given that virtually all of us are heavily engaged in technology. But it is also mistaken. Without concrete business cases driving its deployment, IoT, like many other technologies before it, will fade into obscurity.
Sep. 1, 2015 11:45 PM EDT Reads: 396
SYS-CON Events announced today that IceWarp will exhibit at the 17th International Cloud Expo®, which will take place on November 3–5, 2015, at the Santa Clara Convention Center in Santa Clara, CA. IceWarp, the leader of cloud and on-premise messaging, delivers secured email, chat, documents, conferencing and collaboration to today's mobile workforce, all in one unified interface
Sep. 1, 2015 03:00 PM EDT Reads: 447
In his session at @ThingsExpo, Lee Williams, a producer of the first smartphones and tablets, will talk about how he is now applying his experience in mobile technology to the design and development of the next generation of Environmental and Sustainability Services at ETwater. He will explain how M2M controllers work through wirelessly connected remote controls; and specifically delve into a retrofit option that reverse-engineers control codes of existing conventional controller systems so they don't have to be replaced and are instantly converted to become smart, connected devices.
Sep. 1, 2015 02:45 PM EDT Reads: 172
The Internet of Things is in the early stages of mainstream deployment but it promises to unlock value and rapidly transform how organizations manage, operationalize, and monetize their assets. IoT is a complex structure of hardware, sensors, applications, analytics and devices that need to be able to communicate geographically and across all functions. Once the data is collected from numerous endpoints, the challenge then becomes converting it into actionable insight.
Sep. 1, 2015 01:00 PM EDT
With the proliferation of connected devices underpinning new Internet of Things systems, Brandon Schulz, Director of Luxoft IoT – Retail, will be looking at the transformation of the retail customer experience in brick and mortar stores in his session at @ThingsExpo. Questions he will address include: Will beacons drop to the wayside like QR codes, or be a proximity-based profit driver? How will the customer experience change in stores of all types when everything can be instrumented and analyzed? As an area of investment, how might a retail company move towards an innovation methodolo...
Sep. 1, 2015 12:45 PM EDT Reads: 483
SYS-CON Events announced today that HPM Networks will exhibit at the 17th International Cloud Expo®, which will take place on November 3–5, 2015, at the Santa Clara Convention Center in Santa Clara, CA. For 20 years, HPM Networks has been integrating technology solutions that solve complex business challenges. HPM Networks has designed solutions for both SMB and enterprise customers throughout the San Francisco Bay Area.
Sep. 1, 2015 12:30 PM EDT Reads: 918
Consumer IoT applications provide data about the user that just doesn’t exist in traditional PC or mobile web applications. This rich data, or “context,” enables the highly personalized consumer experiences that characterize many consumer IoT apps. This same data is also providing brands with unprecedented insight into how their connected products are being used, while, at the same time, powering highly targeted engagement and marketing opportunities. In his session at @ThingsExpo, Nathan Treloar, President and COO of Bebaio, will explore examples of brands transforming their businesses by t...
Sep. 1, 2015 12:15 PM EDT Reads: 254
SYS-CON Events announced today that Pythian, a global IT services company specializing in helping companies leverage disruptive technologies to optimize revenue-generating systems, has been named “Bronze Sponsor” of SYS-CON's 17th Cloud Expo, which will take place on November 3–5, 2015, at the Santa Clara Convention Center in Santa Clara, CA. Founded in 1997, Pythian is a global IT services company that helps companies compete by adopting disruptive technologies such as cloud, Big Data, advanced analytics, and DevOps to advance innovation and increase agility. Specializing in designing, imple...
Sep. 1, 2015 11:45 AM EDT Reads: 332
As more and more data is generated from a variety of connected devices, the need to get insights from this data and predict future behavior and trends is increasingly essential for businesses. Real-time stream processing is needed in a variety of different industries such as Manufacturing, Oil and Gas, Automobile, Finance, Online Retail, Smart Grids, and Healthcare. Azure Stream Analytics is a fully managed distributed stream computation service that provides low latency, scalable processing of streaming data in the cloud with an enterprise grade SLA. It features built-in integration with Azur...
Sep. 1, 2015 11:15 AM EDT Reads: 301
SYS-CON Events announced today that Micron Technology, Inc., a global leader in advanced semiconductor systems, will exhibit at the 17th International Cloud Expo®, which will take place on November 3–5, 2015, at the Santa Clara Convention Center in Santa Clara, CA. Micron’s broad portfolio of high-performance memory technologies – including DRAM, NAND and NOR Flash – is the basis for solid state drives, modules, multichip packages and other system solutions. Backed by more than 35 years of technology leadership, Micron's memory solutions enable the world's most innovative computing, consumer,...
Sep. 1, 2015 09:45 AM EDT Reads: 247
Contrary to mainstream media attention, the multiple possibilities of how consumer IoT will transform our everyday lives aren’t the only angle of this headline-gaining trend. There’s a huge opportunity for “industrial IoT” and “Smart Cities” to impact the world in the same capacity – especially during critical situations. For example, a community water dam that needs to release water can leverage embedded critical communications logic to alert the appropriate individuals, on the right device, as soon as they are needed to take action.
Sep. 1, 2015 09:00 AM EDT
As more intelligent IoT applications shift into gear, they’re merging into the ever-increasing traffic flow of the Internet. It won’t be long before we experience bottlenecks, as IoT traffic peaks during rush hours. Organizations that are unprepared will find themselves by the side of the road unable to cross back into the fast lane. As billions of new devices begin to communicate and exchange data – will your infrastructure be scalable enough to handle this new interconnected world?
Sep. 1, 2015 08:00 AM EDT Reads: 173
While many app developers are comfortable building apps for the smartphone, there is a whole new world out there. In his session at @ThingsExpo, Narayan Sainaney, Co-founder and CTO of Mojio, will discuss how the business case for connected car apps is growing and, with open platform companies having already done the heavy lifting, there really is no barrier to entry.
Sep. 1, 2015 08:00 AM EDT Reads: 185
With the Apple Watch making its way onto wrists all over the world, it’s only a matter of time before it becomes a staple in the workplace. In fact, Forrester reported that 68 percent of technology and business decision-makers characterize wearables as a top priority for 2015. Recognizing their business value early on, FinancialForce.com was the first to bring ERP to wearables, helping streamline communication across front and back office functions. In his session at @ThingsExpo, Kevin Roberts, GM of Platform at FinancialForce.com, will discuss the value of business applications on wearable ...
Sep. 1, 2015 08:00 AM EDT
WebRTC has had a real tough three or four years, and so have those working with it. Only a few short years ago, the development world were excited about WebRTC and proclaiming how awesome it was. You might have played with the technology a couple of years ago, only to find the extra infrastructure requirements were painful to implement and poorly documented. This probably left a bitter taste in your mouth, especially when things went wrong.
Sep. 1, 2015 03:00 AM EDT Reads: 472
The Internet of Things (IoT) is about the digitization of physical assets including sensors, devices, machines, gateways, and the network. It creates possibilities for significant value creation and new revenue generating business models via data democratization and ubiquitous analytics across IoT networks. The explosion of data in all forms in IoT requires a more robust and broader lens in order to enable smarter timely actions and better outcomes. Business operations become the key driver of IoT applications and projects. Business operations, IT, and data scientists need advanced analytics t...
Aug. 31, 2015 02:30 PM EDT Reads: 433
Akana has announced the availability of the new Akana Healthcare Solution. The API-driven solution helps healthcare organizations accelerate their transition to being secure, digitally interoperable businesses. It leverages the Health Level Seven International Fast Healthcare Interoperability Resources (HL7 FHIR) standard to enable broader business use of medical data. Akana developed the Healthcare Solution in response to healthcare businesses that want to increase electronic, multi-device access to health records while reducing operating costs and complying with government regulations.
Aug. 26, 2015 07:00 AM EDT Reads: 212
For IoT to grow as quickly as analyst firms’ project, a lot is going to fall on developers to quickly bring applications to market. But the lack of a standard development platform threatens to slow growth and make application development more time consuming and costly, much like we’ve seen in the mobile space. In his session at @ThingsExpo, Mike Weiner, Product Manager of the Omega DevCloud with KORE Telematics Inc., discussed the evolving requirements for developers as IoT matures and conducted a live demonstration of how quickly application development can happen when the need to comply wit...
Aug. 2, 2015 11:15 AM EDT Reads: 565
The Internet of Everything (IoE) brings together people, process, data and things to make networked connections more relevant and valuable than ever before – transforming information into knowledge and knowledge into wisdom. IoE creates new capabilities, richer experiences, and unprecedented opportunities to improve business and government operations, decision making and mission support capabilities.
Aug. 1, 2015 10:00 AM EDT Reads: 500