Businesses don't blindly jump into any offering, free or otherwise, but developers absolutely do. I'm fairly sure that the Gartner customers asking for assistance regarding open source policies or open source product guidance are doing so because developers at the customer site are already using, or would like to use, an open source product. As long as the product is free, easy to acquire, and easy to learn, and it has industry success or buzz and helps the developer be productive, the developer will at least evaluate the product.
This is true for SugarCRM, Tomcat, Geronimo, Spring, Alfresco, Drupal, or Eclipse as much as it is for closed source products. For instance, at IBM we've seen strong uptake in WebSphere Application Server for Developers since making it available for no charge last year.
A happy developer quickly becomes a proponent for the vendor's product. This opens the door to a sale predicated on existing and productive usage of the product in the company. In the case of open-core licensing, the sales rep still has to spend time explaining the differences between the open community version and the commercial product, and the rep still has to justify the price of the commercial product in terms of business value. This will be a discussion with a customer much closer to making a purchase decision than by cold-calling a customer without any previous usage history of the product.
Going back to Prentice's conclusion: that open-core licensing favors VCs more than customers. Agreed, but is that a bad thing? Customers benefit, in the form of new features, faster defect fixes, and better documentation when the open source vendor is paid for its work.
The previous attempt by open source vendors to balance customer and vendor needs by charging for support proved challenging at best. Most large open source vendors have moved away from selling support directly to selling product licenses that also include support. This approach aligns with the standard industry practice of paying for product licenses according to the business value received.
Until, or if, the cloud becomes the leading monetization route for open source vendors, I'd argue that selling product licenses, as is the case with open core licensing, is the best approach for open source vendors and their customers -- oh, and their VCs.
This article, "Questioning open-core licensing for open source software," was originally published at InfoWorld.com. Read more of Rodrigues et al.'s Open Sources blog and follow the latest developments in open source at InfoWorld.com.