In our recent conversation with Danese Cooper, she brought up how open source is sometimes used as a market disrupter. If I understood her correctly, there are times where competitors are locked in fierce competition with each other. At some point, one of the organizations changes the game by open-sourcing their product, effectively kicking the legs out from under the competition. Why would customers pay vast sums for a “proprietary” product, when there’s an open-source one that’s “free”?
Just perusing the list of some high-profile open-source projects, it seems that the company that’s winning the battle for market share typically has little incentive to open-source. The looser in the game can open-source a project as a form of asymmetric warfare, lobbing the holy hand grenade, as it were, into that market. The trick is to not blow yourself up in the process. Consider the following:
Firefox – Reading some history, it looks like Netscape wanted to use open-source as a market disruptor to compete against IE. However, Netscape was never willing to let go of the reigns and really cede control. That control was wrest from their hands with Firefox (originally Mozilla Firebird). Firefox has disrupted the market, and gotten Microsoft dust off their browser and start working on it again.
OpenOffice – This proprietary code, originally owned by StarDivison, was acquired by Sun in 1999, and open-sourced in 2000.
For the past decade, Microsoft has owned the majority of the “Office” market share, and it would be pretty hard to dislodge Microsoft with yet another proprietary office suite. However, OpenOffice has gained a strong position in certain niches, which include government agencies, foreign and domestic. The leading features are Open Document Format (ODF), and “good enough” compatibility with Microsoft Office. ODF makes that claim that your data, your documents, are never at the mercy of a proprietary software vendor. It remains to be seen if OpenOffice ultimately dislodges Microsoft Office, but I think it’s safe to say the market leader is paying attention.
It plays out in smaller verticals on a regular basis. If you’re not winning in a red ocean, consider the doomsday maneuver, and prepare to live large in the post apocalyptic market you’ve created.