I am tired of reporters and others distorting my statements regarding to Open Source. As I look at the posts and blogs out there that have come since my statements at the Churchill Club event on Wednesday , I get the impression that there are zealots so committed to the Open Source movement, they will pick a fight with software companies, just for the sake of the fight.
So, I decided to set the record straight and blog my point of view with regards to Open Source, the foundation beliefs for the movement, and the cultural effects the movement will have on our industry at large.
First, let me start by telling you that Tom Sanders, who wrote about my remarks at the Churchill Club on VNUnet.com got the story wrong and took my quotes completely out of context. And his story, with its sensational headline, didn't properly characterize my point of view and has led to hundreds of angry and misplaced comments in the blogosphere about my views. Dan Farber of ZDNet recorded the event and you can listen to it directly at this link http://i.i.com.com/cnwk.1d/i/z/e/200511/110905_CHC_EVENT.mp3 http://i.i.com.com/cnwk.1d/i/z/e/200511/110905_CHC_EVENT.mp3and you can draw your own conclusions (the Open Source comments are at minute 35:30, but hopefully you will find the complete program of interest):
Later that same day, I had a chance to speak about the Open Source topic at an investors conference held at SAP's North American headquarters in Pennsylvania. I was asked about the impact of the Open Source movement on SAP, and my answer can be seen at the following link:
Because it was an investor conference, my answer was fairly short. I'd like to use this blog to expand on the topic.
Everyone is entitled to their own point of view; here is mine:
You might ask me: Shai, what is Open Source? I strongly believe that Open Source is a combination of many beliefs, and everyone who says they are for, against or participate in Open Source, refer to a different mix of these beliefs. My goal in this blog is to differentiate these beliefs and my personal reaction to each of them.
Openness of Source Code
The need for a consumer of software to receive transparency into the source code versus the black box approach of delivering systems without transparency is a key issue in the Open Source debate, and an issue that SAP has followed closely for as many years as we are in business. During those 30+ years, SAP shipped its application code, probably one of the largest software products in the world, with the source code available to every customer. The result was that almost every customer modified our code to suit their needs, either on their own, or through one of our many implementation partners.
Some of our customers found that process essential to make the system fit their needs. Some customers found that the ability to modify the code made it possible for programmers to veer too far away from the original application they received, and, in future implementations, they reduced the amount of such modifications. When we get to foundation software, such as operating systems or databases, customers mostly want the code in order to debug systems they build on top of those OSS components. Usually they do not modify the code that much, yet the ability to simply walk through the execution of calls into engines is somewhat the best way to learn how the code should be fixed to perform to a customer's unique needs.
So, as you can see, I am not just a proponent of openness of source, at SAP we actually live by that rule on a daily basis. We are now taking this approach to our next generation of solutions, in which we not only expose the code of applications, we go the distance in exposing models of our composite applications in ways that allow non-programmers (business analysts) to modify the delivered apps to suit their business needs. This "Open Models" approach is not theory, it is executed and delivered with our latest generation of packaged composite apps, and we have more than 100 applications modeled and delivered to customers with in our recent delivery of SAP Analytics.
I am a true believer that a swarm of innovators who are passionate about a topic will create a lot more inventions than a group of paid engineers who are managing solutions. True innovation does not happen when we control creativity but when we challenge, create shared vision, and passionately pursue excellence. As such, we at SAP open up our complete process backbone, through a set of web services-based APIs to all innovative companies to build new, innovative, cutting edge processes. When we do that, programmers can leverage SAP's process backbone (without having to reinvest in the basics, and can leverage SAP's large customer base to build their businesses.
To a certain degree we are leveling the playing field between external innovators and our own application developers, letting all innovate on an equal footing without blocking innovation from coming into our customer base. No customs, no tariffs, no secret back doors. With that approach we are hoping to ignite a creative commons development effort around a common enterprise process backbone, in a market that until now did not have any commonality base to trigger such a community of innovation.
In the process of doing so, we are not only providing APIs as many so-called technology Gorillas have done, we have created a community process to receive requirements, recommendations and examples of APIs that are needed for the creative masses as they are building these new innovative processes. So, not only SAP enabled the creation of a thriving eco-system around us , we actually are letting that eco-system guide us and prioritize the efforts we put around the creation of this common platform. I brought in a number of executives from great platform innovators who can drive such a community, to bring more Silicon Valley savvy into the effort, and elevated SAP one level higher in our partner centricity. Most people tend to ignore the fact that SAP created a market where our partners have earned more than 10 times SAP's revenue as a result of our innovation. This "sharing of wealth" has not happened by accident, rather by strategic planning by SAP's founders and current leaders. Very few other companies enable so much creativity around them with such a large share of the wealth going to other parties.
While projects driven by creative commons gain tremendously from the passion and power of the community, sometimes there are missed opportunities from other forms of innovation. In recent years, we have seen the likes of Apple, through the guidance of common vision, and addition by subtraction, elude a more democratized approached of community development. I believe that in cases where a strong individual like Linus is playing for Linux, the shared vision is created and galvanizes the masses of tiny investments along vectors of innovations; yet not every Open Source project enjoys such strong visionary leadership by default.
Ownership of IP by its creators
I work for an IP company, and we believe in the importance of inventors owning the IP they create. At SAP, we believe that without the ability to protect IP, most companies will no longer invest so much of their current revenues in future product innovation. Even with that point of view, SAP still assists the Open Source community, by providing and donating IP that is not core to our business, and where sharing IP will result in faster innovation in areas that will assist our customers better in the long run. One such example is our work with the good folks at mySQL, where we have shared significant code base, IP, and knowledge in helping them build a scalable transactional database over the last few years. Every company has taken a different approach with regards to this issue, and even pure play Open Source companies differ on their approach to this IP ownership issue.
The one thing we do not believe in is the attempt to kidnap the whole Open Source topic by the "socialize IP ownership" movement. We have seen in the past that extreme socialism does not lead to extreme goodness in any area of our lives, and IP ownership is no different. As a matter of fact, any form of extremism is not helpful, and, as such, I think there is room to respect the approach that the IP owner should decide the fate of the IP, not a social pressure group. SAP invests more than 1 billion euros a year in product innovation, and we look forward to many years of continuous investment into improvements of our software. These market leading investments result in continuous additions of functionality and features, including some breakthrough innovations, all of which come from the smart re-investment of our profits into R&D on behalf of our customers.
As the emerging stack of IT starts to get commoditized from below (LAMP stack being the first set, but there many more to come), customers have asked us questions about "supporting Open Source stacks." We continue to monitor customer usage and demand of the emerging stack components, instead of wholesale adoption of every element as it shows up. In that sense, we are different than most companies who center around servicing individual customer by customer landscapes through expensive services.
SAP drives mass volume adoption of customer solutions. When we ship software, it usually runs the most mission critical parts of our customers' businesses and requires predictability of performance. In a sense, we do not have a 24 X 7 agreement, we have a 24 X 7 x 100,000 agreement with the market, with the 100K representing the number of SAP installations around the world. Each and every one of these installations can be remotely monitored, debugged and supported at any point in time. Such needs require that we have certain mission critical capabilities in our stack (hence the uniqueness of NetWeaver as a mission critical enterprise platform), and limit the number of permutations of components at any implementation site. We adopt platform elements as they become common and in high-enough demand, hence our early adoption of Linux ( we were the first to ship our enterprise apps on Linux ), our partnership with mySQL (to try to bring them up to enterprise readiness), and our investment in Zend (the P in LAMP).
The end result of this stack developing from the bottom of our solution map is no doubt a commoditized set of "compute and store" elements, which requires all players to elevate the value proposition one level up. This is a common phenomenon in our industry every 5-10 years, and no one should be surprised (maybe other than those who believe we are at the end of our maturing industry....)
In summary, I personally believe, support and exercise many of the traits and actions shared by the Open Source community, and the company I work for stands for the same beliefs. We are not fanatics about the movement (we're only fanatical about making our customers successful), but believe it generates value for customers at its core. SAP contributes and support many Open Source projects, and I personally help the community and its visionary leaders on many occasions. I don't think you have to be an Open Source fanatic to be accepted by the community at large, and I would hope our point of view would be recognized by the Open Source community, and that our actions speak loudly and positively for myself and for SAP.