Commentary: Microsoft co-opts open source approach

In a major extension of corporate policy, Microsoft has quietly started a program to provide selected large enterprise customers with copies of the source code for Windows 2000 (Professional, Server, Advanced Server and Data Center), Windows XP (released betas) and all related service packs.

The standard agreement, which resembles those under which IBM has traditionally made source code of its operating systems available, allows customers to consult the Windows source code when debugging their own applications and to better integrate Windows with individual corporate environments.

However, the agreement does not allow customers to modify or customize the code, and Microsoft anticipates that problems or bugs that customers may find in Windows will be reported to Microsoft for resolution through normal support channels.

Microsoft lists the main benefits of the program to customers as follows: one, augmenting the ability to debug and optimize customers' internal applications; two, improving troubleshooting of deployed Windows environments; and three, increasing understanding of Windows to promote long-term success of the customer's organization.

Microsoft says it has already released copies of source code for Windows 2000 and Windows XP to a few large clients as well as to academic institutions and large original equipment manufacturers (OEMs). Now it is formalizing this process, extending it to Global 2000 customers and making it routine. The company expects to offer source code to approximately 1,000 large users with enterprise-level agreements with Microsoft. This program will initially be available only to U.S.-based users, but it will eventually be available worldwide.

A first step toward open source?
We believe this is an important change in Microsoft policy. It may be the first step toward a new software development, distribution and business model similar to open source and designed to support the Internet-based environment of Microsoft's .Net platform.

The greatest initial benefit to Microsoft from this move will be building trust with its largest customers. We tend to trust those who trust us, and releasing source code on the basis of mutual trust will encourage those clients to trust Microsoft.

However, the long-term importance of this change is its impact on enabling the software industry (in particular, Microsoft) to leverage more Internet-style business and distribution models. The biggest problem the software industry currently has in leveraging the Internet is not technology--it's developing a viable business model.

Software makers need to find ways to develop and test their products--particularly operating systems--that can work in the multitude of different environments that exist in an Internet-based infrastructure, while retaining ownership and thereby making money.

For instance, the heavily hyped ASP (application service provider) model is now faltering because it had no way to provide the integration and services that companies need. The open-source movement harnessed thousands of users to do distributed development and testing over the huge number of components that this model demands, but software vendors did not control the products, and now they are struggling to find ways to make money.

The power of distribution
Microsoft is in the best position to succeed in this new software environment, and this change in its corporate policy is a good step in that direction. Although Microsoft is certainly a technology developer, its real power comes from its position as the best software distributor in the industry.

The advantage of providing Windows source code is that Microsoft enlists tens of thousands of software professionals in 1,000 or more of its biggest and best customers to help it test its key operating systems in their unique environments. This will create a flood of bug fixes, improvements and extensions that will flow back to Microsoft to improve those products.

In our opinion, the Windows source code will inevitably end up on the Web--within six months or less--where thousands more hackers will start working on it, exposing weaknesses. This will help Microsoft improve its products further until they are bulletproof.

In effect, Microsoft is co-opting the open-source approach. It is essentially recruiting the technical staff of its largest customers (and potentially even the entire hacker community) to help it create improved versions of its software that only it will have the right to distribute. This becomes the vehicle that will drive the technical community to its new model for software development and distribution.

While harnessing the power of an open-source-like strategy for Microsoft, the access agreements specifically do not permit customers to make any changes to the operating system source code themselves, so Microsoft retains full legal ownership of its products. This enables it to continue charging licensing fees and making money--something the open-source community has not been able to do. This gives Microsoft both the distribution channel and business model it needs to succeed with .Net.

Evangelism, viral marketing and response time
By making this policy change, Microsoft is facilitating an "evangelical" community of die-hard software engineers within global 2000 companies that value being more involved in contributing to future modifications and enhancements to Windows. Microsoft has exploited this technique for years across the developer community. Extending this type of "viral marketing" to its operating system is an effective tactic to counterbalance the community aspects of Linux.

However, all this is true only if Microsoft formalizes the process of integrating into Windows suggestions supplied by third parties. At present, nothing public indicates it is prepared to do that. IBM, for instance, never did that for MVS. To produce open-source types of processes, Microsoft must do much more than just give away source code. It must give people a reason to contribute to Windows, and those people must have access to a process whereby their contributions are quickly and obviously included in Windows.

A key measurement that will determine the success of this program is how fast Microsoft responds to the suggestions its customers send. If it takes Microsoft 18 months to implement them in a new version, this will only frustrate the people that identified the issues in the first place.

Large corporate users that want access to the Microsoft source code should contact Microsoft about this program. It will immediately enable their internal developers and integrators to better understand how the Microsoft operating systems work, so they can optimize their systems accordingly. It also gives these users reassurance that nothing in the code is working against them. And it gives users the chance to identify extensions and fixes that they can pass back to Microsoft that ultimately will help them.

Meta Group analysts William Zachmann, Peter Burris, David Cearley, Daniel Sholler, David Yockelson, Dale Kutnick, Jack Gold, Steve Kleynhans, Mike Gotta and Val Sribar contributed to this article.

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