The presented case study is about Siruna NV, which has developed software for real time deployment of mobile websites through a dual Open Source business model. Although this model is not widely adapted, this model can be easily copied as far as it helps to cover development costs by the help of a large and free developer community, helps to market the product, quickly, sets a reference in a rapidly evolving market and succeeds in creating value within an open source setting.
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FITT Toolbox: Open Source Business Model
1. Open Source Business Case
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2. Practice in General
Siruna NV has developed Software for development of mobile
websites through a dual Open source business model
Nature of reusability: this model can be easily copied as far as it
helps to cover development costs by the help of a large and free
developer community, helps to market the product, quickly sets a
reference in a rapidly evolving market and succeeds in creating value
within an open source setting.
Case is mostly generic
Quality/Nature of stakeholders: High tech start-up company, starting
form research results
Processes related to case: business model, IP management
2 | 03/2011 Open Source Business Case
3. How we can help you open the
mobile experience.
5. About Us
The experts in web-to-mobile: Make Anything Mobile
Professional Open Source company
Venture Capital backed startup
Located in Belgium | UK | US | India | UAE | China
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6. : the leading OPEN SOURCE platform
and
managed SOLUTION provider
for mobile web applications
8. Nice USABLE stuff …
Mobile News Mobile Search Mobile Portal
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(POWERED BY SIRUNA) (POWERED BY SIRUNA) (POWERED BY SIRUNA)
m.deredactie.be m.goldenpages.ie m.zita.be
(STANDARD WEBSITE) (STANDARD WEBSITE) (STANDARD WEBSITE)
www.deredactie.be www.goldenpages.ie www.zita.be
9. Open vs. Closed Source
OPEN SOURCE CLOSED SOURCE
Revenue from services Selling software licenses
Source code is publically Source code protected as
available « Copyleft » intellectual property
Source can be adapted / Customer can’t get the
improved source code
Development by a Development inside the
community company
The business models are linked with the license model:
•GPL/LGPL business models
•BSD/Apache models
•Multi license business models: Dual license
11. First Generation Business
Models
Revenues are generated through support, consulting,
Services based training, documentation
A free OS product is used to create a market position for
Loss leader the traditional commercial software.
Vendors as IBM, Apple, Novell, Oracle.. realize that OS provides a way to
compete against Microsoft because:
Fight competition • They can reduce R&D costs
• Eliminate dependencies on competitor’s technology
• Of the access to a large, external development community
Example: instead of competing with Symbian, Motorola committed to OS
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12. Siruna OSS strategy
Is NOT to create a large developer community
Can be a side effect
We control it through the Contributor License Agreement. (CLA)
Disruptive business model
People can try the code, see the internals
They buy what they like (quality)
They can modify the code for their customer
Create a developer/user pull
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13. Dual Licensing
Product available under a regular commercial license for
commercial customers and under a free software licence
(AGPL) for those who live by the principles of free software
The product is technically identical under both licences, but the
financials and the legal ramifications are different
It is up to the customer to decide what path he wants to follow
and what licence to use but restricted by our policy &
commercial strategy.
MySQL AB, Sleepycat Software & Trolltech AS use dual
licensing
Siruna is the copyright holder
14. Copyright of Siruna
Necessary condition for dual licensing.
Gives us rights and protection
We decide what license is used by who:
• Commercial
• AGPL
We can introduce “golden lines” or
credentials.
Our “golden lines”
Adapted for Mobile by Siruna
Google Analytics transformer insert
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15. Affero GPL license
GPL license:
Everything that touches it becomes GPL
(viral)
If you redistribute a GPL software package,
you need to publish your code
Service provider loophole
AGPL license:
Closes the MSP loophole
Software distribution & network access
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18. Open Source Trends
By 2010, Global IT organizations will use OS in 80% of infrastructure
investments and in 25% of business software investments (Source:
Gartner).
OS impact on infrastructure SW is 20 B $ growing to 46 B $ in 2011
OS infrastructure SW
16.000,0
14.000,0
12.000,0 OS
DBMS
10.000,0
AD
8.000,0 Security
AIM
6.000,0
ITOM
4.000,0 Others
2.000,0
0,0
2004 2005 2006 2007 2008 2009 2010 2011
(Source GIMV )
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19. VC activity
Increased VC investment in OS:
2005: 294 M $ was invested
2006: 475 M $ was invested, up 61% from 2005 (Source: Computer
Business Review, Feb. 2007)
Why do VCs invest in Open-Source?
The increased adoption of OS by corporate users.
Attracted by the success of Red Hat,:
Marketcap of 3.8 B $ and .. profitable!
Revenues increasing very fast: 200 M $ in 2005, 280 M $ in
2006 and 400 M $ in 2007
Belief that there could me more money made from OS than from
proprietary software
Lower cost of development
Also lower cost of sales & marketing due to the viral effect of the
dvlpt community
OS leads to better quality assurance, more frequent releases,
community dvlpt
(Source GIMV )
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20. M&A activity
Recent deals:
There were 35 transactions
There were 3 significant transactions;
• Sun acquiring MySQL for 1 B $, EV/S of 14.3 x
• Yahoo acquiring Zimbra for 350 M $ (email
collaboration),
• Nokia acquiring Trolltech for 153 M $,
• Citrix acquiring Xensource for 500 M $
• RedHat acquiring JBoss for 350 M $
(Source GIMV )
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21. OSS Facts & Figures
MySQL – Database vendor
Founded in 1995.
Challenger for Oracle, Sybase, ..
External VC in 2001:
Revenues
• 2002: 6,5 Mio Revenue
• 2005: 34 Mio Euro
• 2006: 50 Mio Euro
Exit 2007: Sun acquiring MySQL for 1 B $,
2009: Oracle acquiring Sun
OpenBravo – ERP vendor (GIMV investment)
Founded in 2003. (Univ. of Navarra – 2001)
External VC in 2006: 4 Mio Euro from SODENA
Revenue 2007: 1,1 Mio Euro
External VC in 2008: 9 Mio Euro
Target 2008: 3,3 Mio Euro
Target 2010: 24 Mio Euro (requiring 15 Mio Euro investment)
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22. Contact Us
FRANK GIELEN, CEO
Zuiderpoort Office Park
Gaston Crommenlaan 10/101
9050 Gent, Belgium
Tel +32 (0)9 331 48 36
contact@siruna.com
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