Open source vendors should focus on value and price

Vendors deliver value beyond just price -- so why is price the key message?

The open core business model has its roots in the traditional software business model. Open source vendors have learned what works in the traditional software business model and applied it to the open core business model. This learning has not been a one-way street. This is the first in a series of posts discussing how open source and traditional software vendors are, or should be, learning from each other.

Recently the IBM WebSphere marketing team launched a "more for less" campaign. The campaign focused on the combination of value and price as the key message.

[ Also on InfoWorld: "When to give up control of an open source core" | Stay up to speed with the open source community with InfoWorld's Technology: Open Source newsletter. ]

I've seen too many open source vendors simply beating the "lower cost" drum. At times they also highlight "not proprietary" as if this is a highly valuable feature, one compelling enough to choose product X over a proprietary product Y. I don't see value in "nonproprietary" for at least two reasons. First, with open standards, the risk of lock-in is reduced not with the availability of source code, but the availability of multiple implementations of the open standard. Second, since the large majority of open source vendors are adopting an open core model, the product for sale can be just as closed source and proprietary as traditional software.

To reach CIOs hearts and wallets, open source vendors should rethink their messaging to move beyond just cost to talk about the "more" that they are providing for "less." Note that "more" can actually be less, as in less complex. For instance, MySQL clearly provides a "lower cost for higher value," in terms of less complex and fewer administrators required than Oracle DB for certain use cases. This is why Oracle continues to value MySQL as part of the pending Sun acquisition.

There's also a longer-term reason to focus on higher value for lower cost than lower cost alone. The latter paints the vendor into the low-cost corner. Going forward it'll be difficult to increase prices as the vendor increases value delivered to the customer.

"More for less" certainly resonates in today's market. This is true for traditional software and open source vendors.

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p.s.: I should state: "The postings on this site are my own and don't necessarily represent IBM's positions, strategies, or opinions."

This story, "Open source vendors should focus on value and price," was originally published at InfoWorld.com. Follow the latest developments in open source at InfoWorld.com.

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