1. Foss models revisited,
Is freemium a bad word ?
Patrice Bertrand – Is freemium a bad word ?

2. Foss models revisited,
Is freemium a bad word ?
Patrice Bertrand
Chairman OWF 2012
Chairman CNLL
Founder and manager, Smile
Patrice Bertrand – Is freemium a bad word ?

3. No free beer ?
● Free, not as in « free beer »...
● Sure, but in real life, who wants to pay ?
And how ?
● Most FOSS developpers are paid, and deserve it !
● A CIO is into cost-cutting all day long
● Why would he or she want to pay if it's optionnal ?
● If it's for the good of mankind, then it's not really in
his/her scope and mission
● How about us ?
Do we pay if we don't have to ?
Patrice Bertrand – Is freemium a bad word ?

4. French government advocates
free software
● French prime minister's letter on free software in
public bodies' IT
● Underlines the need for contributions, both for
moral and practical reasons
● Contribution should aim for 5 to 10 % of licence
cost saved. Better than most do.
Is it the fair rule of thumb ?
● Recommends third party global support, not
linked to usage
Patrice Bertrand – Is freemium a bad word ?

5. FOSS Business Models
3 flavours of FOSS, 3 types of models
● Foundations : shared funding of R&D
● Communities : unpaid volonteers + shared
funding
● Vendors : for profit / invest and reap
In the past 10 years vendor FOSS has
complemented the available FOSS assets
Patrice Bertrand – Is freemium a bad word ?

6. Why do vendors go for FOSS ?
● A sure way to make lots of money ?
● It's trendy ?
● It will get the product known worldwide in no time
(if it's good). Open source is free marketing ?
● Can use wealth of OSS components ?
● Can have some of the development done by
others for free ?
● Only way to break monopolies ?
Patrice Bertrand – Is freemium a bad word ?

7. Open Source Vendors
● Some open source software vendors have a hard
time making a living
● The same guys that claim FOSS means not free
will scold you if your sales pitch is too demanding
● Heed the cry of the lone FOSS developper :
« no-one wants to pay even 100 €, but they all
ask for help and fixes. How am I to pay the
rent ? »
Patrice Bertrand – Is freemium a bad word ?

8. Open Source Vendors
● FOSS vendors are for-profit, normal companies
● They have invested a lot in creating the software
● Some have a VC on their back too
● They need some ROI, or they will die.
● How should they get the money ?
● Distribution ? Not any more.
● Integration ? Maybe for a start, but not scalable...
Patrice Bertrand – Is freemium a bad word ?

9. Open Source Vendors
● Selling support ?
Politically correct, but not so easy
● Support bills should pay for development as well
● Customers should accept that support is a way of
paying the software. Not all do.
● Thus not turn to third party for support
● And probably accept that support cost is
dependant on usage.
Patrice Bertrand – Is freemium a bad word ?

10. Selling Support
Hard to live on support :
● It's so good, why would I need support ?
● Do I really get my money's worth ?
● If I use at scale x100, I don't want to pay x100
(that's what's good about OSS !)
● I might turn to someone else for support,
they give it for less !
Patrice Bertrand – Is freemium a bad word ?

11. Dual licence / dual versions
Distributing under 2 licences is becoming
the favoured model
An enterprise (ie not open source) version,
either :
● Same code with vendor support
● More stable code
● More advanced features
Patrice Bertrand – Is freemium a bad word ?

12. Is freemium a bad word ?
To some, freemium is a scam...
What's wrong with freemium, really ?
● It blurs the line between open source and
proprietary software
● It boasts all the benefits of open source,
but delivers only some
● It sometimes hires rough salesmen with little
knowledge or fondness of free software
Patrice Bertrand – Is freemium a bad word ?

13. What's good with freemium ?
● It adds open source in areas where there is little
● It does offer a wealth of code under GPL licence,
for everyone to use, modify and distribute
● The « community version » is used as such by
(tens of) thousands
● The « enterprise version » is very good value for
the money
● It still is exposed to forks
● It does no harm to « traditional » open source
Patrice Bertrand – Is freemium a bad word ?

14. Vendor FOSS never competes
with traditionnal open source
● Freemium is just one of the models available to
open source software vendor
● Vendor FOSS never competes with traditionnal
open source :
● If the Apache Foundation offers a DMS, ETL,
BPM, that is as good and complete as Hadoop,
has a strong community and becomes a
standard, then vendors are dead.
Patrice Bertrand – Is freemium a bad word ?

15. Vendor and community
● The « hub and spoke », « kernel and extensions »
model combines vendor and community
● A software architecture model, but also a business
model
● Drupal a good example
● Kernel is worth little without extensions.
● Vendor benefits from much development at no cost
● Vendor still controls kernel and guaranties quality
Patrice Bertrand – Is freemium a bad word ?

16. My personnal view on
freemium
● Does more good than wrong, by far
● Programmers must get paid ! That's one way
● Does not compete with rest of Foss, is in different
domains
● Does help getting Foss into enterprise
● True, some vendors are getting borderline
● A problem with community versions that are deemed
unfit for real use
● I would love Foss associations to rank the openness
of major vendors
Patrice Bertrand – Is freemium a bad word ?