Larry Ellison recently suggested that Oracle might consider acquiring Novell as a way to expand into the Linux operating system business and to increase Oracle’s presence in the rapidly growing open source software market. In the past year, Oracle purchased open source database companies Sleepycat and Innobase and was rumored to have been in acquisition talks with MySQL, JBoss, and Zend. MySQL’s CEO Marten Mickos has been quoted in the press as saying that MySQL turned down offers from Oracle. On the other hand, JBoss did decide to be acquired; however, it was Red Hat, not Oracle, who made the purchase.

I do not think that Oracle is likely to acquire Novell at least not at in the immediate future. This looks more like posturing aimed at Red Hat, which now competes more directly with Oracle as a result of the JBoss acquisition. I also think that Novell is still assimilating SUSE and other open source acquisitions making them a difficult company to acquire.

In reality, who knows what will happen in this unpredictable M&A environment. If my years of experience in the technology industry have taught me anything, it is that Larry Ellison is not predictable.

Dana Blankenhorn blogged about a recent Evans Data report that described the open source market as fragmented. He goes on to say, “The whole premise of the study shows just how little most analysts know about open source as a concept.” (Blankenhorn). He ends the article with these questions, “Who are the leaders? I have no idea. The game has just started. Who do you think the leaders are?” (Blankenhorn). If I am reading this right, he is saying that open source is not fragmented, but that it is too early to tell who the leaders are.

Interesting. I suspect that he might be misunderstanding some of the terminology used in the study. A fragmented market or industry is defined as an environment where “no firm has a significant market share … usually fragmented industries are populated by a large number of small- and medium-sized companies” (Michael Porter, Competitive Strategy, p. 191). In other words, a market where there are no clear leaders.

In some cases, the market will eventually consolidate and in other cases it will not. This does not in any way reflect poorly on open source or imply that the open source communities themselves are fragmented. By most definitions, open source is a fragmented market with many smaller organizations providing a wealth of products, but with few clear market leaders. Fragmentation within a market is common when the market has diverse needs and when it is new (Porter), and open source seems to align with both of these ideas. I do agree with Dana that it is too early to identify any clear leaders, and over time we will see how open source software evolves.

The Microsoft Open Source Software Lab’s new Port 25 site has generated quite a bit of discussion over the past week. The site asks people to “Send us your feedback and ideas. We want to hear from you.” (Port 25). In the case of public forums, especially at a company as visible as Microsoft, people may just take you up on the offer.

As GM found with their ‘Write Your Own Ad’ campaign, you will get some feedback that you want and some that you do not want. In Microsoft’s case, “There have been hundreds of blog posts and hundreds of emails sent – both through the feedback aliases and many that you have sent directly to me. There have been rants, demands, questions, encouragement, suspicion, affirmation, ideas, pontifications and guidance.” (Bill Hilf, Microsoft)

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I am excited that Portland, OR will be getting free wireless access starting with a few test areas downtown this summer and citywide access in one to two years. This project has been in the works for a while, and the contract was awarded to MetroFi yesterday.

Since this is an open source blog, I did some digging and found out that they use open source squid proxy server systems, Linux, PHP, and other open source technologies. They are also hiring.

Thanks to Todd for sending me the link!

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Only three days left to submit your Firefox Flicks.

For those who want to see the flicks that have already been submitted, the new Firefox Flicks web site just went live with the first three videos, and they plan on adding a few new ones each day.

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Austan Goolsbee wrote an opinion piece in the New York Times about how Americans face an overwhelming burden every year spending time and money to file tax forms. Much of the information entered onto the tax forms is information that has already been sent to the IRS leading Goolsbee to suggest that the IRS could aggregate this information and send each of us a form with this information already pre-filled meeting the needs of the majority of taxpayers with fairly simple returns. This idea led Tim O’Reilly to comment, “Web 2.0 you say? Well yes. If Google were running the IRS, it’s what they’d do.”

This started me thinking …

What if the IRS was run by open source? Would we have collaborative tax returns? I could opt-in to the “open source taxes” program on the IRS site to start my return, which could be populated with the information that the IRS already has on file. Other organizations could collaboratively add information to my return (charitable deductions, etc.) I could collaborate with other tax preparers for free help and advice or pay someone like a traditional tax preparation company to provide this type of support and service (the Red Hat business model). Some savvy programmers would create nifty open source tools that allow me to simplify my tax return for certain obscure, long-tail scenarios that I share with only 25 other people in the world.

“If I ran the zoo, I’d make a few changes. That’s just what I’d do.” Dr. Seuss.

We knew that JBoss was shopping around, and it looks like Red Hat made the acquisition today. It sounds like a pretty good match. They have similar business models, and Red Hat is intimately familiar with the tools and infrastructure market (Cygnus / GCC, for example). It will be interesting to see how the two corporate cultures come together.

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LinuxWorld Expo was held this week in Boston, and it was the first LinuxWorld that I missed since before 2001. There are too many news stories and press releases to cover here (not to mention the fire in the Unisys booth!), but I will try to cover a sample of the most interesting news.

The Portland Project Evolves

OSDL’s Portland project announced the technology preview for a new set of common interfaces for the GNOME & KDE Linux Desktops that are intended to make it easier for software vendors to port applications to Linux. With no common interface, vendors currently need to port applications to both GNOME & KDE. OSDL hopes that this will help increase the number of applications that are available on Linux desktops.

Stuart Cohen, CEO of OSDL, also hopes that Microsoft will port Office to Linux when Linux on the desktop has achieved critical mass. “Cohen considers the move inevitable in the same way that Microsoft eventually opted to run Office on Apple Computer” (InfoWorld). It will be interesting to see if Microsoft ever supports Office on Linux. A few months ago, I might have laughed at this idea; however, the next story leads me to believe that this might be a possibility at some point in the future.

Microsoft Gets Cozy with Linux

No, hell has not frozen over and pigs still cannot fly; however, Microsoft has announced support for Linux with Virtual Server 2005 R2. Virtualization is becoming widely used in IT shops and hardware vendors are adding support for it in the hardware, and Microsoft seems to want to keep pace with other virtualization products like Xen and VMware.

Microsoft also launched a new website to showcase their open source efforts and their interoperability with Linux and Unix. Right now, it is mostly blogs from researchers in Microsoft’s Open Source Software labs, and it will be interesting to see how this evolves.

Sun and Open Source DRM

Open source and DRM do not seem like two concepts that should be in the same sentence; however, Sun thinks that it just might be crazy enough to work. The idea behind the open source DRM is that consumers can have a little more flexibility with how they can use their DRM content, while the media companies can still protect their content. Even Lawrence Lessig, who still believes in a DRM-free world, thinks that as far as DRMs go, Sun’s open source DRM is not too bad.

Norway Increases Use of Open Source Software

Every week, I try to highlight one example of a government or company embracing open source, and this week Norway announced that they will start using more open source software to reduce dependence on large, international companies like Microsoft.

Dietrich Ayala, Firefox engineer, presented to 120 fourth graders as part of career day on various topics including Firefox, Mozilla, and open source software. Here are a few of the more interesting quotes from his presentation notes:

• Though almost every kid said they surfed the web, when I asked if they knew what a “browser” was, only a couple kids knew. However, I know that they actually *were* surfing the web because of the questions that they asked. It seemed that the browser was a piece of infrastructure that blended into their general computer experience.
• Anywhere from 5-10 kids in each group had heard of Firefox.
• 1-2 kids in each group had heard of “open-source”.
• The kids knew of viruses and phishing. They didn’t understand what they were, but knew that they were bad, and from the internet.
• They thought the Firefox logo was cool. They thought the Mozilla logo was cooler 🙂 Especially the boys. Several started grilling me on the anatomical incorrectness of the dinosaur: “If it’s from the pleocistene family it’d have a bump on it’s head and the nostrils would be in a different place.” I had no response to that. (Dietrich)

I suspect that some of these findings would apply to adults, too. Many people do not really understand what a browser is or what viruses and phishing are.

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I listened to an interesting episode of Inside the Net hosted by Amber MacArthur & Leo Laporte interviewing Brian Oberkirch and Alexander Muse from Big In Japan. Most of the time was spent reviewing Big In Japan’s products, which sounded pretty cool; however, the most interesting part for me was a discussion about the differences in the dot-com era and the current web 2.0 craze.

During the dot-com bubble, money was king. The entire technology industry was obsessed with stock prices, and we spent an inordinate amount of time talking about IPOs, venture capital investments, and exit strategies.

This time around in the web 2.0 craze, the industry is behaving completely differently. Money is still important (we all need to pay our bills), but people do not seem quite as obsessed with money. The current web 2.0 environment is less about closely guarding your business model and more about being open: open source software, open APIs, mashups, and more. The web 2.0 culture seems to be about sharing and doing things that we love doing. Leo Laporte compared the current environment of cooperation, harmony, and altruism to the hippie culture of the 60s.

I think that open source has influenced the current web 2.0 culture. Open source has always been about sharing the source code to provide an opportunity to customize it to fit a particular need. Similarly, the web 2.0 environment is about opening up your data and allowing it to be used freely in creative ways through mashups or other mechanisms. Google Maps is one of the leading examples of this phenomenon.

The open source business models are also starting to mature and are beginning to demonstrate that companies can make money with open source software, which means that people can do something altruistic that they love doing while still making enough money to pay the bills. IBM is an interesting example; they sponsor developers who contribute to the Linux kernel and they contribute code through initiatives like Eclipse knowing that they will be able to sell related services, up-sell customers to more expensive products, and sell related hardware because of their work will open source. Web 2.0 seems to be learning from the mistakes and successes of open source with similar business models. For example, Big In Japan uses consulting and up-sell business models to support the tools that they provide free of charge.

Web 2.0 and open source companies will be interesting to watch over the next few years to see how the business models evolve to understand how sustainable these models are over the long term.