2011 Future of Open Source study; presented at InfoWorld Open Source Business Conference Keynote Panel: Tom Erickson, CEO, Acquia; Adrian Kunzle, Managing Director, Head of Firmwide Engineering & Architecture, JP Morgan; Mike Olson, CEO, Cloudera; Jim Whitehurst, President & CEO, RedHat. The panel was chaired by North Bridge. More than 450 respondents took part in the 2011 survey, including representatives from both the vendor and non-vendor communities. Respondents were asked about a wide range of issues impacting the open source software (OSS) landscape, including: economic impact on OSS, key drivers and barricades for OSS adoption, and suggestions for building and maintaining a profitable OSS business model. For the first time, supporting the fact that open source has truly gone mainstream, end users accounted for 60 percent of the survey respondents and the quality of responses continues to increase, spreading across all levels of IT management from developers to a large number of C-level executives. Respondents have identified SaaS, cloud and mobile as the main areas that will have a dramatic impact on open source and that are driving growth. The open source customers are now more focused on maturing technology issues, including improved operational excellence around areas such as support, product management, feature functionality and return on investment. This is in contrast to earlier years where the survey had pointed to things such as the legal implications of licensing and conforming to internal policies.  56 percent of respondents believe that more than half of software purchases made in the next five years will be open source.  95 percent of respondents noted that a turbulent economy continues to be “good” for OSS, though for the first year ever, lower cost has been overtaken by freedom from vendor lock-in as what makes OSS more attractive.  When asked about revenue generating strategies likely to create value for vendors, 56% of the respondents said that an annual, repeatable support and service agreement was the most likely.

1. Future of Open Source
5TH Annual Leadership Keynote

2. The Panel
2
Jim Whitehurst
President & CEO
Mike Olson
CEO
Michael Skok
General Partner
Tom Erickson
CEO
Adrian Kunzle
Managing Director

3. Agenda
3
Industry
Impact
Direction
Investment

4. Collaborators
4

5. 5
Who we heard from.
(you!)

6. Survey Response
6

7. Survey Respondents
7
Vendors Non-Vendors
%%

8. Survey Respondent’s Titles
8

9. 9
FutureOpensource.net

10. Agenda
10
Industry
Impact
Direction
Investment

11. Backdrop
11
Turbulent economy

12. Get Out the Vote!
12
66937
Is a turbulent economy
good (goodfor)
or
bad (badfor)
for Open Source?

13. Is a Turbulent Economy Good or Bad
for Open Source?
13
0%
20%
40%
60%
80%
100%
Good Bad
2009 2010 2011

14. LIVE Vote!
Txt Your Vote to 66937
15
What makes Open Source software
most attractive?
“quality”Better Quality Software….
Lower Acquisition Costs… “lower”
Abundance of Code…..…. “abundance”
Flexibility…………............. “flexibility”
Rapid Pace of Innovation.. “rapid”
Superior Security…………. “superior”
Vendor Freedom……….... “vendor”

15. What Makes OSS Attractive?
16
Lower costs
Freedom from
VENDOR Lock-in
Access to code
libraries
Lower costs
Superior security
Freedom from
VENDOR lock-in
Lower costs
Freedom from
VENDOR lock-in
Rapid pace of
innovation
2008 2009 2010 2011
Freedom from
VENDOR lock-in
Lower costs
Flexibility

16. 18%
15%
15%
15%
14%
13%
7%
3%
Tipping Point – What’s Driving Adoption?
18
Vendor
Lock-in
Economic
Downturn
Public Sector
Adoption
Private Sector
Adoption
OSS
Experience
Quality
Other
Mobility

17. Top Barriers to OSS Selection
20
Lack of internal technical skills
Unfamiliarity with open source solutions
Lack of formal commercial vendor support
126
122
98
responses
84
65
Legal concerns about licensing
Does not conform to internal policies

18. What Sectors will be Disrupted by OSS
Over the Next 5 Years?
22
Mobile
OS
DatabaseMOST
LEASTERP/CRM
Office
Productivity
Business
Intelligence

19. How is the use of OSS Components impacting
the Manageability of Applications?
24
More
Less
None
29%
24%
47%

20. 26%
20%
14%
15%
17%
8%
Top Vendor Revenue Sources Today
26
Custom
Development
Support
Subscriptions
Ad-hoc
Support
“Closed-source”
Licensing
Value-add
Subscriptions
Other
17%
25%
7%
20%
18%
9%
4%
+ 2
Years
Advertisements

21. LIVE Vote!
Txt Your Vote to 66937
29
Which of the following will have the greatest
impact on software delivery for OS vendors?
“software”Software-as-a-Service.......
Mobile Devices………….... “devices”
Private Clouds……………. “private”
Public Cloud Computing.... “computing”
App Stores………………... “stores”

22. Impact on OSS Vendors?
31
SaaS
Private
Cloud
Public
Cloud
App Stores
Mobile
Devices

23. Cool OSS Projects mentioned…
32

24. 2009
Top 5 up & coming OSS Companies
35
2010 2011

25. Agenda
36
Industry
Impact
Direction
Investment

26. 22% 72%
2.7%
24%
OSS Investment – by the numbers
37
2009
Dollars
Invested
Deals
Completed
Ave Deal
Size
Seed,
Series A
$375M 73 $5.7M $65M
$466M
71
$7.0M $112M

27. Agenda
39
Industry
Impact
Direction
Investment

28. 96
67
62
75
42
94
89
85
OSS Deployed in Your Organization
40
75%-100%
50%-75%
25%
-50%
0%-
25%
Percentage of OSS is Deployed
Responses
Today
In 5
Yrs

29. IN 5 YEARS: What % of Software
Purchases Will be OSS?
42
2015
2014
50% or more on OSS
2016
2013

30. Wrap-up: The Open Source Path
43

31. OSS is Mainstream…
44
Private Sector
Adoption
Lower
Costs
Growing
Investments
Avoid Vendor
Lock-In
Public Sector
Adoption Higher
Quality

32. … But Not Yet Mature!
45
 Internal technical skills
 Unfamiliarity
 Vendor support

33. Watch for Path Traps
46
 Innovation vs. bloat
 Maintenance costs
 DevOps

34. Opportunities!
47
Big Data
Mobile
Cloud

35. 49
http://www.northbridge.com
/open-source

36. A big thank you from North Bridge to…
50