AWS, MongoDB, and the Economic Realities of Open Source
Basically, MongoDB sells three things on top of its open source database server:
- Additional tools for enterprise companies to implement MongoDB
- A hosted service for smaller companies to use MongoDB
- Legal certainty
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This leaves MongoDB Inc. not unlike the record companies after the advent of downloads: what they sold was not software but rather the tools that made that software usable, but those tools are increasingly obsolete as computing moves to the cloud. And now AWS is selling what enterprises really want.
Worse, because AWS doesn’t have access to MongoDB (it is only matching the API) it only supports MongoDB 3.6; the current version is 4.0.5.
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This tradeoff is inescapable, and it is fair to wonder if the golden age of VC-funded open source companies will start to fade (although not open source generally). The monetization model depends on the friction of on-premise software; once cloud computing is dominant, the economic model is much more challenging.
Update (2019-01-23): Exponent:
Ben and James discuss open source in a cloud world, how enterprise value chains have changed, and AWS versus Microsoft.
Update (2019-02-14): Bryan Cantrill:
So those are the two cases, and they are both essentially bad for the open source project. Now, one may notice that there is a choice missing, and for those open source companies that still harbor magical beliefs, let me put this to you as directly as possible: cloud services providers are emphatically not going to license your proprietary software. I mean, you knew that, right? The whole premise with your proprietary license is that you are finding that there is no way to compete with the operational dominance of the cloud services providers; did you really believe that those same dominant cloud services providers can’t simply reimplement your LDAP integration or whatever? The cloud services providers are currently reproprietarizing all of computing — they are making their own CPUs for crying out loud! — reimplementing the bits of your software that they need in the name of the service that their customers want (and will pay for!) won’t even move the needle in terms of their effort.
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As part of their quest for a business model, these companies should read Adam Jacob’s excellent blog entry on sustainable free and open source communities. Adam sees what I see (and Stephen O’Grady sees and Roman Shaposhnik sees), and he has taken a really positive action by starting the Sustainable Free and Open Source Communities project.
