Monthly Archives: August 2013

How Many Users Pay for Open Source Software Services?

A question I frequently hear is “how many of our open source software users will become paying customers?” I’ve heard many answers to this question. I’ve heard from industry analysts that open source projects tend to end up at about 1% to 3% of users paying for services when the projects mature. This is an easy figure to remember but my experience is that it is often not accurate. What’s more, the reasonable number for a given open source project varies widely based on many factors such as:

  • The cost of the services
  • The adoption of the open source project
  • The open source license type
  • The success or failure of the project’s marketing efforts

To give an example, the MySQL open source project is rumored to have around 15,000 paying customers. According to a recent 451 Research report titled Sizing the opportunities for MySQL, NoSQL, NewSQL and DBaaS, the project has about 15,000,000 users. MySQL is arguably the most successful open source project of all time with a valuation of $1 billion when Sun purchased MySQL AB in 2008. But the numbers above indicate only about 0.1% of MySQL users are paying for services, an order of magnitude less than the 1% to 3% range frequently quoted.

How many open source software users pay for services for the DotNetNuke platform? According to published figures, the company has perhaps 1,000 to 2,000 paying customers with an installed base of between 500,000 and 1,000,000. That calculates to about a 0.2% rate of open source users who are paying for support services. Again, about an order of magnitude less than the 1% to 3% rate often quoted.

So what is going on? These are both successful projects which started as open source projects and then were followed by companies that were established to provide services to users of the projects. In both cases, adoption was widespread before a commercial company existed. This is different than software companies that begin as commercial enterprises with proprietary software that then “open source” their proprietary software in the hope of driving more adoption. In the latter case, the 1% to 3% range is perhaps accurate. In the case where a very successful project came before a commercial company, it appears that a number that is closer to one-tenth of the usually quoted range may be closer to reality.

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Filed under Open Source Software Adoption, Open Source Software Users

Welcome to the OSSMarketing Blog!

Welcome to the Open Source Software Marketing blog. I’ll be sharing my experiences marketing open source software and describe some of the keys to success that I’ve found. My most recent two open source software companies have both enjoyed tremendous growth during my time there. One was number 228 on the 2010┬áInc. 500 and the other was number 1566 on the 2013 Inc. 5000. Over the past five years with these two companies, I’ve experimented with many marketing variables and established a foundation of marketing principles that hold the key to OSS marketing success.

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