The Future is Open …
Tim O’Reilly wrote this past weekend of the potential value of opening up data, in the same way software has been Open Sourced.
Certainly the full story of the Open Source trend has yet to be written, and I would agree with Tim that data represents one element of the complete story. In fact, in a sense, wikis and blogs are to Content, what Open Source has been to software. There are, however, still significant impediments to the free and open use of data, even if that is what its producers intend. Specifically – and this is what what I believe Tim was concerned with in his blog – is the fact that data is often closely coupled to the tool that produced, or hosts it. Consider the challenges of sharing mapping data across the different platforms, or the directory and presence information as part of interworking IM based ‘phone calls’.
Regardless, it can be seen that Open Source software is indicative of a broader trend that has impacted, or will affect: …
- Software
- Hardware, and
- Data / Content
This trend involves the intentional and selective commoditization of portions of the value chain, which in turn can create a competitive weapon to undercut established market leaders and their previously unassailable market positions. Communication software stories, like Asterisk, Pingtel, and Freeswitch, are becoming more common place every day, while (arguably) open source hardware is relatively new, and can be seen in start-up initiatives like Chumby, and Tuxphone.
You could also lump some ‘Software As A Service’ models that leverage open APIs, enabling mash-ups, into this same general trend. While the principles are very different, they have similar consequences. Consider Google maps. It provides an open API, so that you can use the data and software underneath, at virtually no cost, in order to provide new services and applications. So the result is to commoditize the enabling service/tool even though the underlying platform is usually heavily proprietary, as is the case with Google.
AOL, has just announced an initiative to open its new AIM Phoneline service to developers in order to compete more effectively with Googletalk, Skype and others. This too will commoditize some of their product features, enabling application innovation and driving the network effect. They hope that this will in turn, improve their user base and ad based revenue stream. But the method by which they achieve this goal, is to commoditize some of their tools and services. From a business investment perspective this is the essence of Open Source strategies – they alter the value chain, to undermine the competition’s business proposition, and/or to create greater business leverage in the process.
What I find exciting about all of this, is that the effect is to further disaggregate the communications industry, producing more ‘open market’ platforms, and creating rich application ecosystems in the process. This will in turn create growing market opportunities for smaller players, and thus foster competition and innovation … our market system operating at its finest.
If you want to meet some of the people behind these changes in Telecom, you will find them at the Voice 2.0 conference, to be held in Ottawa, Canada this October.
