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Part IV of IV: The Battle of the Business Models


Put all of the announcements covered in my first three entries together and you start getting the picture. The current tectonic shift in the market is about business models and the disruptive impact of OSS. On one hand, you have Open Source and Open Standards and on the other you have Closed Source and Closed Standards. But, more importantly, not everyone can play on both sides. The companies that are trying to fight the OSS game, like IBM, are "traditional" software companies with "traditional" software cost structures. They have traditionally high cost of sales, higher cost of development, and high cost of marketing.


When corporate JBoss was two people and a dog, we had reached our first million downloads. It was also already a formidable community, vast, diverse, largely anonymous, but pervasive. Today we are 150 people at JBoss, Inc. and JBoss Application Server (AS) has become entrenched at 40% market share, with BEA and IBM each at 20%. With JBoss Enterprise Middleware Suite (JEMS), which includes JBoss AS, Apache Tomcat, Hibernate, JBoss Portal, JBoss jBPM, JBoss Cache, JBoss Eclipse IDE, with JBoss Rules and JBoss Transactions coming online in Q1 2006, we are accelerating the pace of innovation and the penetration. We are not just winning customers; some would say we are gobbling them up.


How is this possible? While our competition is forced, by their very nature, to fight a war of attrition, we engage in maneuver warfare. Think Vietnam. When Ho Chi Minh recruited General Vo Nguyen Giap to lead the Vietnamese forces against the French and, later, the Americans, he told the story of "The Elephant and The Tiger." The metaphor describes how smaller military forces can defeat larger ones, if the proper strategy is employed. If the tiger ever stands still, the elephant will crush him with his mighty tusks. But, the tiger will not stand still. The tiger will leap on the back of the elephant, tearing huge chunks from the elephant’s side, and then leap back into the dark jungle, as the elephant slowly bleeds to death. The days when my competitors can “JBoss doesn’t have this” or “JBoss doesn’t have that” are numbered: JBoss Rules and JBoss Transactions are the latest chunks we are ripping out of those arguments.


How can a small structure of scrappy geeks challenge elephants like IBM? I believe it is because we were born on the Internet, as a community and as a company. Our cost structure, our organization, our business model is build around the identity of a software vendor that leverages the impact of the Internet. We use it for development using the traditional models of OSS development; we use it to achiever lower costs of sales and marketing; we use it for distribution, reaching mass market at very low cost; we use it for support, offering free forums and for-pay programs to support hundreds of thousands of developers around the world. Welcome to the OSS jungle. We can survive, nay thrive on lower revenues, and that is a crazy new world for our competition.


Our organization reflects our roots. Can any company make the transition to such a business model? Well, not really. The elephants would have to shrink significantly, since our revenues are lower, to be able to mimic our cost structures and compete on a equal footing on the value we deliver. The bottom line is that the Internet has spawned companies like ours and MySQL that deliver value comparable to the traditional players at a much much lower cost. This fight is not even fair.


The move to subscriptions is scary in an on itself. Subscripations are great revenues that are renewable and predictable. It is not inherent to open source. CA, Salesforce, JBoss, Red Hat are all in this mode of sale today. Can companies move to a subscription based business model overnight like SUNW just did?.


If Sun could do such a bold announcement the other day, it is because they DON"T REALLY MAKE MONEY AT SOFTWARE. The softare revenue represented around 1% of their revenue (120M on 12BN sales). So from a Wall Street standpoint it was a wash, it was irrelevant for the money guys--which is why SUNW's announcement generally drew yawns. In fact, Sun was pitching that they intend to increase their revenues BECAUSE of that shift. That is a luxury that Sun has because, ironically, they sucked pretty bad at selling proprietary software.


However, this is not the case of our proprietary competition: BEA and IBM. IBM has $2Bn running on WebSphere and BEA SOLELY depends on its Tuxedo/WebLogic line. For them to transition to subscription and OSS is a systemic shock that might literally kill them. It took CA I don't know how many years to make a smooth transition to a pure subscription business model and they did so by gorging on acquisitions of installed bases in order to increase their base of renewable business. I believe BEA may follow the same tactic of subscription sans OSS, which is possible a la CA. Increase their base to 80% maintenance renewability, "restructure" the last 20% of your work force and, voila, you have achieved the transition.


There are reasons for why the transition is scary. First, a simple accounting rule. If you sell $1M of licenses you usually get to recognize EVERYTHING UPFRONT as revenue. In other words you show $1M revenue in the first quarter you sell. IF you move to subscription you recognize 1/4 every quarter. In other words, you show Wall Street a drastic drop to $250M revenue instead the usual $1M when you do the transition? From an earnings standpoint you drop 75% on that cusp. Obviously it all washes out in the long term, but the cusp is the scary moment for Wall Street, with its short-term focus. Again this was irrelevant for SUNW since licenses represented less then 1% of their revenue. Novell, as another example, did the transition easily to Suse. They claim since they were not selling any licenses anymore, so it was all maintenance anyway.


Add to that the fact that you got to cut your prices in OSS in order to compete with the likes of RHAT, JBoss and MySQL and you get a double whammy effect. Lower revenues right there. And trust me these guys just don't have the corporate culture or structure to handle such shocks: THEY WERE ORGANIZATIONS DESIGNED IN ANOTHER ERA, IN ANOTHER TIME, WITH DIFFERENT BUSINESS ASSUMPTIONS AND DRASTICALLY HIGHER SUPPORT STRUCTURES.


Very specifically, whereas JBoss spends the traditional software P&L on sales and marketing, the orders of magnitude efficiency brought to both structures by the Internet, reduce our sales and marketing costs 10x compared to our proprietary competition. Bottom line we can support SM without a for-pay license, as simple and scary as that (and by DEFINITION of our model BTW). I hope the math is trivially clear. What scares our proprietary competition is not so much the end game of OSS and subscription as Schwartz called out the other day, but RATHER THE SPEED AT WHICH THEY MUST ADAPT THEIR ORGANIZATIONS TO THIS NEW BUSINESS MODEL AND THE FACT THAT THEY ULTIMATELY HAVE TO SHRINK. If they miss the transition, again it could a shock to their systems. This, by the way, is why you should never believe the intentions of IBM and BEA when it comes to OSS middleware and database. It is all about making sure the transition happens on their timeline, that things get commoditized as slowly as possible, so they can internally manage their organizations. I mean... Websphere has 10,000 developers (!!). We on ALL of JEMS have 50. People used to throw this fact at our faces as the proof we would never succeed. It is actually their Achilles heel, now that we are fighting a jungle war on our turf.


Why cannot the elephant fight like the tiger? Assume IBM or BEA resolved the internal political battles over open-sourcing their proprietary technology. Make the even less likely assumption that they could make ditching hundreds of millions of dollars of revenue for a smaller eventual outcome palatable to Wall Street and their shareholders who sweat them quarter by quarter. Then the technical and legal reality is that most of the larger proprietary implementations, especially in spaces like middleware, are neither legally nor practically consumable in open source. So they have to start over, and fight in a new space against an entrenched competitor that is faster and more agile than they are.


I think those cost structures and the inertia built in them (you can't restructure that fast) are the biggest weaknesses of the elephants as we fight turf wars of accelerating timelines of OSS'ing. Between Sun and JBoss we have OSS'ed overnight TWO key components of the high-end technology the elephant is feeding on now, and which they were counting on until the year 2030. Integration and distributed transactions are now out in the open. That timeline acceleration is what scares them to death. How fast we commoditize dictates how fast they must react and adapt their structures to the new realities of the new market. No one, not even us, would have predicted a year ago that in December 2005, both integration and distributed transaction management would be commoditized. In, the space of week, Sun and JBoss just created a nightmare for the elephant.


By publicizing a pro-open source stance when what they wanted was to push Linux, IBM grabbed the tiger by the tail. Open Source has been unleashed, thanks in part to their efforts promoting Linux. Meanwhile, they never intended for their own business to come under pressure. They only meant to hurt MSFT, not themselves...Now, at a time when Sun and JBoss are going all open, BEA and IBM are going closed. They are retreating into their shell to closed source and closed standards. SCA reflects the bare mathematics of their financial structures. They can't afford to commoditize SOA, not that fast. Integration and transactions overnight, they just can't. So, instead, they create an exclusive club around a closed standard and pay lip-service to open source. All the while, they make sure the implementation will remain low-end while they continue milking the high-end. It is a desperate attempt to get control of the timeline and protect the high end. IBM’s attempted play with Geronimo is transparent to the market, why adopt backwards technology that lacks all the goodness, when the stack has already been open sourced? They will do everything they can to slow down the commoditization curve; meanwhile, we will continue accelerating it. The new reality of the market is that CUSTOMERS adopt the timeline as fast as they can. Customer demand will settle the score.


In the meantime, Professional Open Source companies must act like the tiger in order to survive—attentive, observing, fast, stealthy, able to exploit the element of surprise, striking everywhere, able to retreat into nowhere, agile, adaptive, capable of swiftly reacting and re-calculating their moves. The traditional IT superpowers lumber into the OS jungle, where we were born and where we live and breathe and think they can take over our territory because they have more employees, more revenues, bigger balance sheets and a bigger name. While they get mired down in fighting internal political battles and tough external selling jobs to Wall Street, the real OS players will continue to innovate. The entrenched OS player has to fail massively in its delivery on quality of product and quality of support to lose its first-mover, market-leader advantage. In the jungle, speed and agility and knowing your territory win over size. OS does not stand still.


The first time we encountered this “Anything an OS player can do, a proprietary vendor can copy and do better” scenario was when HP started giving away Bluestone for free. It was a defining moment for us. We wondered if traditional logic would hold and the larger brand and the larger balance sheet would win over the established OS player, once cost no longer became an issue. Very simply we wondered if we would die. What irony that Bob Bickel, the brain behind that move at HP, is now our very own business dev head and has been instrumental in growing JBoss and HP is one of our partners today.


Open Source is soo hot right now. When I first started out, it was so not (JBoss started to mature as a product right when the tech bubble burst, and the disappointed expectations of the Linux Wave left a bad taste in everybody’s mouth). Everybody told me JBoss will never succeed: you guys are nobodies and you compete with every big player in this industry. Now the big players in the industry are falling over themselves to move into OSS or control it. The problem is that open source is about a lot more than marketing window dressing. Without street cred in OS development in your chosen space, without continued innovation on the product front and without highest-quality support from the core developers of that software, all you got is smoke and that ain’t gonna help you when the tiger leaps out of the underbrush.


I hope I have helped you grok some of the dynamics in our market. This is how I make sense of the recent moves in our industry. It is about a business model battle and it is reminiscent of the elephant and the tiger. Traditional IT superpowers, is open source your Vietnam? Time will tell.


Remember we love you,



PS: On Sunday as I was working on some of these blogs, my six-year old daughter came to me and said "Daddy, why are you working on a Sunday, is IBM still after you? (sic)." I laughed and said "Yes darling, IBM is still after me but now a whole industry is ganging up on us." She asked why. I thought about it a bit, how can you explain all of this to a 6 years old and answered "Because we might be small but we are mighty." She said "like mighty mouse!" She laughed at the image, herself and then, thirty minutes later, she came back with a rhyme and said "Here Daddy, include this in your blog and tell them it comes from me."


"Mighty mouse, mighty mouse
Is coming to your house
Be careful, he will trick you!"

Part III of IV: IBM and BEA announce SCA


Last week IBM/BEA/SAP and a few others announced a new specification called the "Service Connector Architecture" (SCA). Here is an article about the news
BEA official: New SOA spec won't go to JCP


From a technology standpoint we are still wrapping our heads around this announcement, but cursory analysis reveals that it is a potpourri of JBI/EJB3/SEAM. That is interesting actually, at least from a tech standpoint. It seems to re-invent, by copying a lot of programmatic constructs, a lot of the microcontainer, IOC, annotations, stateful conversation innovations that are present in these three frameworks and standards. It is a new shot at a closed standard for SOA.


But the real meat in this announcement is what is missing:

  • The fact that key vendors like MSFT, Sun and JBoss were left out of this, making it a de facto closed standard
  • It is done OUTSIDE of the JCP standards body, in fact purposefully bypassing it.


That right there should be a warning flag as far as the adoption of this technology goes. Guys and gals, this is a declaration of war on standards and you shouldn't bank your future on closed proprietary formats. It is a closed standard, not an open standard and SCA will have problems getting support from JBoss and Sun, without a true open standard endorsed by the JCP.


It is not the first time BEA and IBM attempt this kind of dubious manoeuvre. The first time they were simply frustrated by the slow speed of the JCP, rightfully so. Earlier, they attempted the SDO coup to force Sun's hand to standardize a spec, written outside and after the fact, with a stamp of approval at the JCP level. These are known as "purple JSRs" -- JSRs that were created outside by a small clan and then forced on the JCP. SDO failed. This time around it is something different.


We are all frustrated with the speed of the JCP and would like to see it be more nimble (note to Bill Shannon: follow an aspect oriented approach to service definition, TX would fit in 5 pages with annotations, same for security, same for webservices, same for persistence, same for remoteness, same for monitoring, same for management, same for injection, same for dependencies, same for clustering yada yada, we are well on our way to do that. What we need is to break up EJB4 in many little pieces, my two cents…) But here BEA and IBM said they don't want to standardize. It may be a bluff, but I don't think so.


I wonder if SCA isn't IBM and BEA’s response to Sun open sourcing SeeBeyond, or vice versa. But I don't think this is the heart of the matter anyway. I do, however, really believe IBM and BEA want to bypass the JCP. See, what happened to Java EE when JBoss joined was a rapid commoditization of that stack. We rapidly became the number one vendor. After all, why compete on a standardized technology when it is implemented by a credible and independent open source entity? I knew that when we joined the JCP EC, achieved standardization and captured volume leadership IBM was going to react. They did so by acquiring Gluecode and are botching it.


Bottom line is that FOSS a la JBoss, where developers are in control scares the hell out of IBM. We heard from ex-IBM'ers that we are the new Microsoft to them. We commoditized EE fast, capturing volume leadership, and they REALLY don't want to see the same thing happenning to SOA and integration where they make so much of their money. So IBM and BEA left the JBI specification when we joined. Of course they used a weak excuse about some tech point or other, but if you put the timelines together you get the picture.


Now they went off and created their own little exclusive club keeping us, MSFT and Sun out. Are they afraid of REAL standardization? I think they have just done a great disservice to the Java community by attempting to splinter the spec in the Java world. This coup d'etat attempt worries me. These folks want to sell proprietary implementations of proprietary standards and not let Sun and JBoss mess it all up with open standards and open source. Here again MSFT must be laughing its @ss off at the mess being created.


To add insult to injury, IBM and BEA are trying to "open source" the Tuscany project at Apache. I read the announcement by the IBM employee to the Apache lists, What turns my stomach upside down is when I read this letter telling the Apache community about "meritocracy". Haven't you guys had enough of this hypocrisy from IBM, enough of being treated by IBM like a colony? I know we do as members of the apache community. Here is a message for our developer friends in the Apache community. Beware of uncle IBM offering you candy and talking about how right you are to do BSD licenses and about meritocracies. It is all about being able to fork the good community work you put in there for their competing implementations. END OF STORY. I am sad when I see young developers buy into the license noise and how GREAT it is to do BSD. To me, this is nothing but naivete asking to be taken advantage of. Guys, BSD is a license FOR VENDORS that doesn't protect your work. ISV's should beware of these licenses as well, since they lead to forking and poor community implementations BY DESIGN.


IBM is deathly afraid of companies like JBoss that can self-sustain and beat them in the marketplace with FOSS. As long as they control the timeline of releases, the roadmap and they can fork when needed (which they ALREADY did to Geronogo, poor guys…), they are fine with FOSS. Developers take note. By BSD licensing your software, the best you can professionally hope for is low level employment in the belly of the beast.


Oh don't get me wrong, we at JBoss are just as controlling in the sense that we control the roadmap and quality of the FOSS projects we lead, but we do it with a different mindset. WE ARE COMMITTED TO PURE OPEN SOURCE PLAYS. BE IT AT APACHE (Tomcat/mod-jk) or with Hibernate, or Arjuna etc. Remember IBM loves Linux under GPL, because it has no choice on the license and it helps them fight MSFT but they HATE REAL FOSS when it comes to MySQL and JBoss. They pay lip service to how committed they are to FOSS. In areas where they actually make money, they make sure their low end FOSS implementations are crap…and then fork the hell out of them. BEA is there in the SCA, I am not sure why. They look more like a headless chicken than a leader here.


Again, while big vendors like IBM and BEA are taking the road of closed standards and closed implementations and paying lip-service to open source, we at JBoss choose the road of true open standards, the JCP and real pure-play FOSS. Our agenda is completely transparent; theirs is not and never will be. If you are an end-user or an ISV you should know where the difference lies and care about it. SCA is just another attempt to force everyone's hand, in this case by capturing volume with closed-standards open source a la IBM. Ask yourselves why they didn't want JBoss and Sun in there? Simple: JBoss would probably have the best implementation before they could say "my license business is safe"--they don’t want to repeat the EE commodization nightmare.


This leaves JBoss and Sun in a mode where we MUST collaborate to make the JCP a success. Together, we control the volume distribution of STANDARD EE. JBoss reiterates its commitment to the JCP and Sun as a leader of the JCP. We are looking at SCA, from a technology standpoint and if there is anything worth doing, we will. We will also standardize a lot of the work we have already been doing. Collectively, we already have most of the tech that they have, the differentiator will be programming models and I believe in the EJB3 style standard of programming (which I helped write, so it is not surprising :) Open Standards, open source and good programming models will prevail.


I will leave our friends at IBM and BEA with a little historical parallel. Attempting to split the programming model by splitting the standards according to vendor interest will play out just like THE UNIX WARS. IBM believes they can win it, that they control all the cards, and BEA is so afraid of us that they would rather cozy up to their old enemy… Meanwhile, IBM already lost with Gluecode. Maybe they’re still inebriated with their Linux success against MSFT and don’t see it. Sun WON the proprietary Unix wars, they lost. Then Linux started to trump Solaris, but it wasn't all about IBM, it was mostly the improving quality of Linux and the power of FOSS. IBM has none of this with SCA and Tuscany, not a volume play (we do) not a true FOSS play in L/GPL (we do). Oh how quickly some forget that Open Source IS NOT JUST LINUX. Now ask yourselves who is the Linux of Java EE? JBoss, that's who.


Much as IBM would like to believe their little coup d'etat will succeed, if tech history has anything to teach us, it is that they have already lost. Open Source on Open Standards has always prevailed. Why? What’s in the best interest for the customer? Proprietary standards and proprietary implementations or open standards and open source?


I know where I vote. I know where the majority votes.



Part II of IV: SUN Open Sources ALL software


SUNW last week announced that it would open source ALL OF ITS SOFTWARE and pursue a subscription business model à la JBoss. WOW.


A good article that captures most of it is Information's week Charles Babcock's Sun Bets On Open-Source Middleware For Turnaround


I was in Munich at the time of the announcement drinking beers at night with Sacha Labourey and Michel Goosens as we were doing a European press tour (London, Munich, Paris) and we dialed into the conference call. I was trying to put a question to Jonathan Scwhartz and John Loicano to congratulate them on the bold move and ask them how they hell they were intending to pull it all off. Needless to say I was filtered out of the call.


As Charles noticed Jonathan Schwartz, SUN's COO, must have mentioned JBoss 10 times as the proof point of why the business model was working. Essentially, this is a 180 degree turn from statements two years ago when Jonathan was also announcing that SUN would be the new dominant PROPRIETARY software player. Now, Jonathan has seen the light and decides to open source everything, mentioning JBoss as a proof point of the business model of FOSS and subscription. SUN's turnaround is going to be bet on the JBoss business model?


Just a little point of correction for the SUNW marketing team and the press. As the Wall Street Journal picked up, Sun's appserver SES with it's claimed 3.5 M downloads is NOT THE VOLUME LEADER. JBoss has 6 M on AS alone (as verified by Sourceforge) and north of 8M downloads on the JEMS suite, and that is not even including Tomcat. So, please correct your slides.


But the numbers are details. On a grander scale, betting the future of SUNW on FOSS and subscription is a bold and visionary move by Scwhartz and his team. The writing was on the wall and I predicted something like this would happen back when IBM announced their acquisition of Gluecode, specifically that it would "force Sun’s hand". However I didn't expect them to answer this quickly and this strongly. They have met IBM’s challenge and raised the bar.


The last time Sun open sourced something I wrote "Sun open sources XYZ, who cares?" but this time around there is a significant dimension that I want to focus on. Just as our acquisition of the Arjuna/HP transactional technology represents a significant acceleration of the timeline at which we open source technology, SUNW's OSS'ing of SeeBeyond is an explosion in the integration sky. We saw it, and cheered. I am sure IBM took notice, but I am not sure they are cheering.


All of the sudden, integration and distributed transactions, two technologies that were supposed to hit FOSS maturity in the year 2030 timeframe are available now, mature now, stable now in FOSS. SeeBeyond was a solid if not overly exciting tier 2 integration play, but nonetheless I claim this represents a steep escalation of violence against IBM’s reluctant FOSS strategy.


Both moves go directly to the heart of IBM's software business in Websphere. Half of their license business is driven by integration and high-end transactions. That is not even counting the Global Services revenue that comes from integration because Websphere is so complex. The acceleration of the timeline must be spinning heads in Armonk. A trap door just opened under their feet. Fear and loathing of FOSS must be at an all time high over there. "What did we do with Linux? We wanted linux only... Not ALL of software, ohmygod!".


I don't know why SUNW is choosing to market this as a move against MSFT. Being an ex SUNW employee I know that the anti-microsoft crack is pervasive in their ranks but come on guys, MSFT is laughing their heads off at this move. We are eating each other up right now, throwing bombs over trenches. I believe it is a marketing mistake to target MSFT with this because they don't care. In fact, I am sure they applaud the short term implications of this move...


While we are on the topic of botched marketing communication, I really think SUNW should drop the "Solaris link" with SES. It is a mistake. People will use it in other platforms, remember. Our own user base at JBoss is 50% WINDOWS. You guys invented Java for cross platform purposes. I hear in the market that it is pretty good :) why you decide to go against that technical fact is beyond me. Selling hardware nowadays is done on hardware merits alone, due to the dominance of virtual machines. You either compete on metal or you don't.


Let's talk about the long run. Jonathan, if you read this, congrats again on this move, but seriously you have nowhere to run now. You need to succeed. Fail and Wall Street will open source you (as the comments on yahoo financial boards called for in the wake of these announcements); succeed and you will be hailed as The Man.


Sun has a poor track record of execution in middleware. Quality of implementation has always been sub par and customer satisfaction is a sore problem. SeeBeyond has its own legacy bloat to deal with. Solaris is a shining star in your line up, but face it JES has been an embarrassing failure so far. Even after being open sourced, it still fights for 8th place marketshare in the low-end. What next? You already OSS'd it, are you going to do like IBM and give away plasma TV's for people to download your middleware? Free and OSS doesn't cut it nowaday, it is not the silver bullet some people think it is. JBoss succeeded because the SOFTWARE AND THE SUPPORT are world class.


Charlie Babcok’s analysis is right on the money, the devil is in the details. Can Sun open source everything as they claimend? On what timeline? Through our partner network that has OEM relations with SeeBeyond, we know FOR A FACT that Sun CANNOT open source certain parts of that stack. Already Sun is back-tracking in the press as to the timeline, oy! Come on, Sun, execute well on this one. This is your last chance, but it’s your best shot yet. I would hate to see them end up with the short straw on this one.


As far as competition is concerned this is further fragementation of the number 2 open source middleware contenders. SES will be fighting Jonas, Geronogo for distant second place in open source and maybe 5 or 6 th across the board, in the market. ONJava survey puts JBoss at a 40% market share as of a couple of weeks ago and IBM and BEA are at 20% each. How in the world is anyone going to encroach on our respective positions? For what reason? For sub-par software and support? JBoss ranks first in customer service satisfaction, which is normal since this is the only place we make money. Hmmmm, anyone considering migration would be taking a step backwards on the software and support front. SUNW would be wiser to work with us, as opposed to fighting us.


But don't let me downplay the Sun announcement. It says "the future is now" and "the future of the business model is Professional Open Source". This represents a tremendous acceleration of the timeline of OSS: buying SeeBeyond for $400M and then OSS'ing it was a bold move. Just as IBM forced Sun's hand 6 month ago, Sun just forced the hand of ALL THE BIG PLAYERS NOW. The dominos are starting to fall and JBoss sits in the sweet spot , in a war of the worlds that involve the big boys, JBoss represents a premium brand of volume OSS distribution. Everyone has to react to an open source stack, again, I got made fun of the last time for saying this but where will it end? The future is now and I congratulate SUN for calling the end game on the business models and putting its software where its vision is, will it be enough for SUN to pull it of? Probably not, but we will see,


I am starting to seriously enjoy this,

Part I of IV: The Arjuna Deal


As you may have seen in the press, on Monday Dec 5th, JBoss announced the acquisition of the Arjuna Transactional engine from Arjuna and HP. We also announced the recruitment of their cofounder and CTO Mark Little.


The press was pretty good on this, about 40 articles and counting. Two of our favorites were
The phone interview with Jeremy Geelan of Sys-Con
The Register’s Gavin Clarke.”Tuxedo this, sucker”


The deal is fairly straightforward: we are acquiring three technologies from HP and Arjuna

  • The JTA engine for standalone embedding in JBoss AS
  • The JTS engine for distributed transaction
  • The WS-TX engine for distributed transactions over WebServices.


We will be open sourcing ALL this technology in the Q1 2006 timeframe. All of it is already integrated since Arjuna was a long-standing partner of JBoss. Our commitment is to Professional Open Source as a business model and open sourcing technology. We are proving that we can accelerate the timeline for product completion by open sourcing previously proprietary technology. This is a first for us.


In keeping with our professional open source methodology, Mark Little will be joining us in the capacity of Director of Standards, leveraging his background in various standard bodies. He will also lead our ESB effort. Mark is well known as one of the foremost experts on distributed transactions. As you know we care about super-stars. JBoss today concentrates many of the lead developers in our industry (and I don't count ;) We are all very proud to welcome Mark to our ranks.


The significance of this move should not be lost: we are bringing technology to the mass market that was previously a high-end, proprietary niche. By the same token we are also bringing FOSS benefits to the high-end market by reducing the cost basis and simplifying the model. This move of open sourcing previously successful and well-established proprietary technology is a benefit to both worlds.


I particularly liked the Gavin Clarke sub-title of "Tuxedo this, sucker" as JBoss Transactions will clearly be a formidable competitor to BEA Tuxedo. This represents a several hundred million dollar business in both licenses and maintenance. Despite the fact that the financial markets haven't yet picked up on the news, we are clearly going after the new market for transactions. While Tuxedo is part C, part C++, part Java, Arjuna stood out as a pure Java play from the get-go with fifteen years of TX experience behind it. Historically, distributed transactions hadn’t progressed far in FOSS because they serve a need in a high-end niche. We just closed that window. Here is the solution and it is one of the best. It removes the last significant barrier to entry competition like BEA were using against us. Time to revisit those JBoss FUD marketing slides boys. You got some catching up to do.


IBM has always been afraid of this move. I remember hearing through analysts that the scenario that personally scared them was "When JBoss would get distributed transactions". Nobody expected us to get this fast. Well, that future is now. It is a new world out there.


The real significance of this announcement is that FOSS is maturing fast, the business of FOSS is maturing fast and we are proving that we can get to market through financial ways that were previously thought out of our reach, we did this without raising debt or equity. Today, we are proving a new way of delivering FOSS technology, not just the traditional in-house approach like we did with clustering, or the proven, federation approach like we did with Hibernate; today JBoss has the financial wherewithal and market credibility to acquire proprietary technology and open source it overnight.


Tuxedo this, boys.



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