Open source challenge for mobile ISVs

Adam Leach/Ovum
12 Nov 2008

Open source is the emerging development methodology for mobile phones, reducing operational costs, harnessing innovation and shortening time to market for new devices and services. With both Nokia and Google already choosing an open source model for their mobile platforms over the past 12 months, the pressure is on independent software vendors (ISVs) in the mobile market to adopt an open source strategy.

For a start, ISVs need to be familiar with open source environments to be able to respond to demands to integrate customers' solutions into those environments. In addition, OEMs and operators will start to expect similar levels of transparency and collaboration on key areas of interest for them. As a result, ISVs will need to evolve their business practices to meet these new expectations, in some cases embracing an open source business model.

From a product perspective, adopting an open source strategy can involve as little as deciding to use an open source component, through treating open source as a supplier, to deciding to adopt an open source license for the entire product. In both instances the risks associated with the use of open source need to be managed.

Adopting an open source license for an entire product development for a company that does not derive its main revenues from software royalty involves less risk. Google, for example, makes its money through advertising, not selling software; Sun Microsystems makes most of its money through selling servers, not software; equally, Nokia's business is based on hardware sales. So open sourcing products for these companies poses fewer issues and does not require completely re-engineering their businesses.

For a pure software vendor that derives all of its revenues from software licensing, the move toward a complete open source strategy has a greater amount of risk associated with it.
Vendors looking to pursue this strategy will need to consider which aspects of the product offering will derive income. Potential areas of revenue will include professional and value-added services, high-value features that command premium prices, and insulating customers from 'copyleft' licenses (the name given to licenses such as the GPL which require that any code that is derived from the original code is contributed back to the community).

Due diligence is essential

When evaluating an open source component for use within a commercial development, a vendor should ensure the same due diligence is applied to the assessment of the software as would be used for any other new software supplier. This would include detailed product analysis to determine if the software meets functional and non-functional requirements, as well as benchmarking against other suppliers (open source and proprietary).

In addition to this, an assessment of the licensing terms needs to be made to ensure the obligations of the license are met; this may also involve deciding how the component is integrated into the overall software stack.

Support and indemnity are the next important considerations. Open source projects will generally provide limited support, usually supplied on forums from community members. An open source project will not provide any indemnity to the users of the code. Deciding how to approach this issue will depend on the component itself and its importance within the product and how aligned it is with the core competency of the engineering team and the company.


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