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Will Real feast where Apple failed?

As RealNetworks turns to open source in its battle for the streaming media market, it faces a foe as formidable as Microsoft: history.

As RealNetworks turns to open source in its battle for the streaming media market, it faces a foe as formidable as Microsoft: history.

Many have compared RealNetworks and its establishment last week of the Helix open-source initiative to Netscape Communications, which in 1998 was the first significant software company to put its proprietary product into open-source development, only to languish.

But among the three major streaming media competitors, Apple Computer was the first to make the leap to open source--a move that also offers something of a cautionary tale for the curative powers of such efforts.

In April 1999, a month after it established the Darwin open-source organization that would give birth to its OS X operating system, Apple revealed the source code to parts of the QuickTime streaming format and invited developers and companies to use and disseminate it.

Apple may have been first, but it hasn't been much of an inspiration.

"Apple as of late hasn't shown a lot of interest in that," said Jupiter analyst Michael Gartenberg. "What Apple did with QuickTime was far more restrictive, and what they actually opened up was somewhat less. Also, you have to have a willingness to work with the open-source folks and take them seriously, and at that time Apple was more interested in being associated with trendy open-source people than really opening up QuickTime."

The track record of open source in reviving flagging corporate software products is not encouraging. Mozilla in four years has failed to stem the tide away from Netscape, and Sun Microsystems hasn't dented Microsoft's dominance with its open-source version of StarOffice.

But Apple's experience in open-sourcing streaming media provides an even more dismal example. Even critics who concede that Darwin was successful in shaping a well-received operating system contend that the QuickTime open-source streaming effort has been a disappointment.

Apple competitors, industry analysts and streaming media insiders point out that while QuickTime may have grown its market share in the three years since Apple took the open-source route, the QuickTime server that Apple released into open-source development has failed to exhibit any significant growth.

Soured efforts
"It's pretty clear from the market landscape today that (Apple's open-source streaming effort) was not a success," contends Dan Sheeran, RealNetworks' vice president of media systems. "Their share of the server market was pretty infinitesimal, and it's still pretty infinitesimal."

For its part, Apple defended the project, bristling at analysts' and open-source advocates' claims that the server hadn't seen any significant level of commercial implementation since going open source.

One benchmark of success among commercially initiated open-source projects is the number of outside developers who latch onto the idea and contribute code. Apple declined to say how many different developers were contributing to its QuickTime server development, but it named Sun, Xerox and IBM among the contributors.

Apple added that it had seen more than 400,000 downloads of the QuickTime server source since the 1999 release. And regardless of its impact on market share, Apple said the open-source project has provided other significant benefits.

"From a general perspective, we get bugs fixed," said Rhonda Stratton, senior product line manager for QuickTime. "From a strategic perspective, we find out what platforms really matter. It's helped us in our strategic planning, in maintaining resources, with features and understanding where to go with the product. And it gives us new features and capabilities without us necessarily doing all the work."

RealNetworks, by contrast, is betting on a more bottom-line benefit from its open-source adventure.

Rather than aping Apple, and Netscape before it, Real insists that it's going the open-source route in response to business partners' demands.

The way it has worked until now, a handheld-computer or cell phone maker like Nokia or Sony that wanted its device to play RealNetworks content had to approach the streaming company and negotiate to have a specially tailored version of the software provided.

In some cases, according to Real, that meant getting in line to wait for the company's developers to catch up with demand.

"It's hard to pick and choose what are the great strategic opportunities," said Jupiter analyst Gartenberg. "At this point, even an enthusiast who says, 'This information gadget should have a RealPlayer' can include one himself. That's a very powerful advantage for Real, because it means that any new device coming out could potentially be a platform for Real technology."

Outshining Apple?
One significant difference in the two companies' approach to open source is in the licensing. Apple offers its source code under the Apple Public Source License, a rough equivalent to the General Public License. Under the GPL or close equivalent, developers generally are free to modify the software however they like.

Real, however, is offering the software under one of two licenses. The first is a modified GPL-type license. The second is a so-called community license, like what Sun uses with its Java programming language, under which developers are required to maintain compatibility with a set of application programming interfaces that come with the source code.

RealNetworks is counting on the notion that commercial developers will opt to sign the community license, which will give them certain RealNetworks branding rights and allow them to certify their products as Real-compatible.

Without that license, RealNetworks fears its streaming software could wind up a flood of conflicting versions.

"The danger of not doing this the right way is that you wind up with a Tower of Babel," Sheeran said. "If we just gave this source code to Sony for its set-top box and then to Nokia for cell phones and then the server side code to Cisco and HP, and they all did their own versions however they wanted, it would defeat the purpose because the versions, over time, would not be compatible with each other."

One irony in RealNetworks' latest move is that while the company once was the target of a now-defunct reverse-engineering effort, it this week announced it has done what it calls a "clean-room implementation" of Microsoft's Windows Media software that lets RealNetworks stream Windows Media files over the Internet.

So far, without releasing a bit of code, RealNetworks has already earned an amount of street cred in open-source circles that Apple's effort never achieved.

That, analysts say, may be simply because RealNetworks has more to lose if its open-source plans go sour.

"I think they're much more serious about working with the open-source folks out of necessity," Gartenberg said. "The necessity is that this is their sole business. Media is important to Apple, but Apple's business is in hardware. If Real wants to work effectively against Microsoft becoming the dominant standard in streaming media, then they will have to, without a doubt, work aggressively to include the open-source community."

Gartenberg dismissed comparisons to Netscape, whose browser development effort was plagued by stalls and defections amid a steady hemorrhaging of market share to Microsoft.

"By the time Netscape went open source the browser wars were essentially over and Internet Explorer was already a standard," Gartenberg said. "There was never much of a business in selling Navigator to begin with. It became a free product, and the fact that it went open source didn't make much difference in the world. But RealNetworks is still very much a contender in a strong business."