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How to successfully compete with open source software


Found an interesting post via a Twitter friend today with ideas on how proprietary software companies can compete with open source software. The guy who wrote it isn’t an open source hater, in fact he says he uses plenty of open source software for his own websites. His post also covers open source applications catering to consumers rather than businesses, so it’s not exactly Red Hat that he’s talking about here, but I still thought the ideas were worth taking to heart.

The first three ways he says you can successfully compete with open source software are, in this order 1) marketing 2) design 3) user experience. His reasoning? From the post:

OSS concentrates on the software, not the problems the software can solve: Take a look at an OSS site, any OSS site.  You’ll see a whole lot of talking about the software, the implementation of the software, the source code for the software, how you can contribute to the software, etc.  You’ll almost never see anything about the problem domain — the assumption is that, if you’ve stumbled upon the site, you already know you have a software problem.

I think he is on to something here. We open source software people do tend to sometimes fall in love with our software and how it is made and works, rather than falling in love with our customers and how we can understand and solve their problems. It is easy to agree with this in theory I’ve found, but in reality, it is a lot harder to stay focused on the customer’s needs when there is all this cool software to be made:)

In Red Hat, there are plenty of people who recognize good products are only one piece of the puzzle and work to ensure Red Hat does not fall into the trap of only talking about what our software does. We try hard to ensure the brand and experience of Red Hat is clearly differentiated from both our open source and proprietary competitors. Red Hat makes more investments in design, brand, marketing, and user experience than probably almost any other open source software company. Perhaps these investments have even played a role in making Red Hat one of the largest and most successful open source software companies (I’ve found this hard to measure, of course, Dark Matter Matters and all that…).

One of my favorite sites illustrating an innovation trap that most open source software companies (and many technology companies more broadly) fall into is hosted by the company Doblin, a prominent innovation strategy firm. Click here and then find the innovation chart they have made for the “computer” field (they use Flash, darn it, so they make it really hard: click on “innovation landscape,” then the “more landscapes” tab, then click “computers”). I’ve pasted their main chart here, but really encourage you to go to the Doblin site for more details.

doblin

Granted, their data is somewhat old, and I think they are talking about mostly hardware companies, but I would hazard that the same problems persist in the software industry today as well. Namely, that almost every technology company focuses on innovation in product features and functionality,  ignoring many other potentially lucrative areas for innovation.

The companies that have innovated in the green field opportunities like customer experience (Amazon), brand (Apple), and business model (hey, that’s Red Hat!) have an advantage because there is not as much competition for differentiation in those areas.

Where the rest of the technology industry is maturing pretty quickly to fill in the innovation gaps in the green field areas, open source software companies could probably stand to spend some more time thinking about how they address the issues that Patrick McKenzie raises in his blog by innovating in areas in addition to the software functionality itself. It’s working for us!

About Chris Grams

Chris Grams is Head of Marketing at Tidelift. He is also the author of The Ad-Free Brand: Secrets to Successful Brand Positioning in a Digital World.

Discussion

2 thoughts on “How to successfully compete with open source software

  1. Thanks for the mention. I’m glad you liked the article.

    >>
    Red Hat makes more investments in design, brand, marketing, and user experience than probably almost any other open source software company.
    >>

    I’ll say this for you, as somebody who has worked in two companies HEAVILY invested in your server technology: you’re one of the darn few open source companies that has a visual identity I could sketch off the top of my head. (I remember freehanding it when one of my Japanese colleagues asked why Fedora was called Fedora.) You guys and Rails jump to mind immediately, I remember MySQL has some sort of orange thing going on, and after that… uh… thats about it. (Oh, plus Firefox on the B2C side, come to think of it.)

    There are a few other projects that I’ve worked with every day for 2+ years and couldn’t so much as name a color associated with them.

    Posted by Patrick | March 9, 2009, 10:11 am
  2. thanks for the article against open source software..heheh

    Posted by open source software | September 26, 2009, 1:40 am

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