A new answer to open source vs. the cloud

Some time ago, people wondered (and worried) whether the cloud will kill open source. Today we have an answer, which is: The cloud is open source, most of it anyway. So we observe a peaceful coexistence, with both community and commercial open source software working well with cloud services. However, I would like to go deeper on this question as we have have new data available.

  1. One data point is the observation of the growth of non-software industry users developing open source software to run their businesses. This may have a significant (negative) impact on traditional closed source sales.
  2. Another data point is the dominant business model of single-vendor open source firms, which is to give the base software away for free but charge (primarily) for a cloud service (of this base software).
  3. A final data point is that open source vendors almost exclusively play in the infrastructure and not in the business application space.

This creates a split, where I expect most if not all commercially relevant business applications to be on-premise or self-hosted open source, for a single tenant, and where operating such applications at scale in the cloud, for multiple tenants, will be closed source (until it gets eaten by open source).

With business applications being open source by default, this leaves only one spot for software vendors to make their traditional profits using closed source, which is in application-specific cloud operations.