The most successful open-source business model to date may also be the one least able to consistently deliver growth.
Matt AsayContributing Writer
Matt Asay is a veteran technology columnist who has written for CNET, ReadWrite, and other tech media. Asay has also held a variety of executive roles with leading mobile and big data software companies.
Drupal is a fantastic Web publishing platform that derives much of its value from a disparate community of contributors, as Xconomy recently wrote. With more than 4,000 contributed modules from over 3,000 active contributors (741 of which contribute to Drupal Core), Drupal has something for everyone, which is both its greatest asset and biggest liability.
Choice is good. Too much choice, however, can be bad.
The same holds true for Red Hat, which charges a premium for its Red Hat Enterprise Linux distribution to enterprises that want to tap into Linux but don't want the bother of rolling their own version of Linux from Kernel.org.
The problem, however, is that such a business model depends upon the complexity of the underlying platform. If that complexity goes away, does the business model?
The Drupal-focused company Acquia is thriving because deploying Drupal, what with its myriad of choices, can be complex. Ditto for Red Hat. There are thousands of packages that comprise Linux, making it worthwhile to pay a trusted guide like Red Hat.
But Red Hat CTO Brian Stevens suggests that "you need product complexity" to make its model work. Does this mean that Red Hat and Acquia will be hitting the unemployment lines if they do their jobs too well, and Drupal and Linux become too easy to use?
For this reason, I believe Acquia's model has more staying power, though it has a long way to go before it generates Red Hat's nearly $1 billion in annual revenues. Acquia's model allows it to thrive even if Drupal becomes easy, and also affords the company greater latitude to enter new markets, like the application market, where product complexity is not as much of an issue.
Red Hat, on the other hand, must resolutely focus on core infrastructure, an area of the software stack that is naturally prone to such complexity, because of its adherence to its complexity-dependent business model.
Both models are generating impressive returns. But Acquia's open-source model seems to offer more potential in the long term than Red Hat's does.