Dennis Howlett recently wrote an aggressive post in his Irregular Enterprise blog. According to him, the traditional software maintenance pricing model is dead. Dennis is convinced that enterprises are rejecting this pricing model when they realize the incredibly high profit margins of proprietary software vendors. Their operational margin is often close to 30%, and it obviously comes from maintenance services. In parallel, the ability of user organizations to invest is reduced in the same proportions. Dennis questions the long term interest of such a strategy.
As far as maintenance is concerned - as in many other domains - open source solutions vendors focus first on customer satisfaction. I can’t help thinking about this client of ours who, when asked to talk about product features for a case study, spoke first about the high quality of our technical support services - which was, according to him, the main reason why he gave up his proprietary solution to adopt our solutions.
To quote him: “Even as a user of Talend Open Studio - the free tool from Talend - we are getting high quality support. The vendor offers a Bugtracker on their web site, which helps us to track the process of reported bugs. The first reaction of Talend’s support operators when a problem is reported is to try and solve the problem, not to brush it under the rug with classical arguments too often heard (’you are the only one with this problem’ - sounds familiar?).” This specific client is now building a connector that they will donate to the community. This is not what I call give-take but win-win!
This simple example illustrates the richness and advantages of the open source model. But let’s not be hypocrites: our ambition is to grow our business and improve our products. But we will not do this against our users, or by not providing good service. This is the difference pointed out by Dennis, whose views clearly go in the right direction.
As a conclusion I would also recommend reading this other post by Dennis, inspired by a Gartner case study that details the benefits Ikea Components got from a large Business Intelligence and Process Management project:
- Product availability: improved 30%
- Customer lead time: decreased 50%
- Customer claims: decreased 85%
- Inventory days: decreased 40%
- Order-handling costs: decreased 30%
But they still built an online help system that did not meet clients’ expectations…
I’ll close this post with Dennis’ conclusion: “Isn’t it a pity when companies that otherwise make great IT investments succeed in torpedoeing themselves by implementing something that is horribly flawed and detracts from the customer experience?”
Worth thinking about?
Bertrand
Yesterday’s InfoWorld home page boasted a great piece: Open source lessons from the French. Bertrand was interviewed by the editor Tom Kaneshige on the topic - after all Talend is probably one of the best examples of a successful French software vendor this decade.
Bertrand is quoted in the article:
“All students in France use open source,” says Bertrand Diard, CEO and co-founder of Talend, a French pioneer of open source data integration software. “A lot of universities in the U.S., except probably MIT, use traditional tools like Microsoft, Oracle, and SAP.” As a result, open source talent is more prevalent in France, Diard says; development is faster, and software quality is higher because French developers aren’t distracted by proprietary and competing technology. “The culture of open source is more advanced here.”
Yves
This week,Talend did to data quality (DQ) what it did to data integration (DI) almost two years ago. We announced the first open source data quality solution. And the same way open source has stormed the data integration market, it will also storm the data quality market.
Proprietary vendors in this field command extremely high license prices. Very few of them are actually independent: a few years ago most DQ vendors were taken over by DI vendors. In turn, these DI vendors have been acquired by database or ERP vendors. As a result, clients buy DQ as part of a full IT stack: it will come along with your WebSphere or your SAP package, and if you spend $10m with the vendor maybe you’ll get DQ as a free add on. But if you don’t have $10m to spend - well you’d better be ready to spend $250,000 or more for DQ.
Here is why Talend’s solution is different:
- It’s open source, and thus commands a much lower “acquisition” price and TCO than competing products
- It’s open source, and thus it’s open. For users, that means essentially extensible. Want to add lookups against an industry repository, or public domain information? Yes you can. Want to customize the solution? Yes you can. Try that with proprietary solution, whose bread and butter consists of selling you add-ons to connect to this or that.
- It was grown from the same code base as our DI platform. That means that DQ can actually be embedded into DI (by design and not as an afterthought). And since it’s the responsibility of the DI guys to make sure that they don’t propagate bad data, putting DQ features at their fingertips brings tremendous value.
We have briefed a number of industry analysts and members of the press this week, and the feedback has been overwhelmingly positive. I’ll post separately about some of the results from these discussions.
Yves
At LinuxWorld last week, we raffled a Tux Droid. Our friendly talking and singing penguin was won by Jerry H. from Cupertino, CA. Congratulations, Jerry!
By the way, LinuxWorld was a great show for Talend. Talend Open Profiler, the first open source data profiler, was expected by the attendees. There is really a great demand for open source data quality - a clear confirmation of what our community had been telling us.
Next week we’ll be at TDWI in San Diego. If you are in the area, visit us there! And yes, we’ll be raffling another Tux Droid.
Yves
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