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| Home - CEO Spotlight - May 05 Issue |
CEO Spotlight: Marc Fleury, JBoss, Inc. |
By Angel Mehta, Managing Director, Sterling-Hoffman Executive Search
Angel Mehta: What was the genesis of JBoss?
Marc Fleury: After finishing my Ph.D. in Physics, and a stint in the army as a Lieutenant in the Paratroopers, I moved into the real world and started making money. I had exposure to early Java technologies at SAP and at Sun, and ended up putting two key trends together: open-source and the server-side of Java. I started one of the first open-source projects involving Java and that was really the birth of JBoss. We started the company in my in-laws’ living room.
Angel Mehta: How did JBoss go from an open-source project to a commercial entity?
Marc Fleury: I started JBoss as an open-source project but always with the intention that I’d make a living at it, if possible. Before JBoss, Inc., I started a company in Silicon Valley around the JBoss project. It failed because we were unable to secure funding and we were trying to dream up a complex business plan around it. That’s when we moved to Atlanta where my in-laws live. The users started telling us what they wanted, specifically training and support, and I said, “Sure, I can do that”. So by listening to what our user-community wanted, we slowly migrated towards a COMMERCIAL entity dedicating itself to writing that software and supporting the needs of the community. It was a ‘back-to-basics’ approach to business where we let the customers tell us exactly what they want and if we can deliver that service we will, which is how we make money.
Angel Mehta: Does JBoss actually sell products?
Marc Fleury: Yes, and it’s worth spending some time contrasting our model to other open-source models. We call the JBoss model Professional Open Source and MySQL is another example of a company following the same model. We contrast that to the first generation business model of the Red Hats and the SUSEs, who are basically what we call the ‘distribution and packager’ model.
JBoss, just like MySQL, is a software vendor. We distribute free software under open-source licenses and provide services for the software but our revenue stream is not that of a service company specifically; we don’t exhibit linear scalability with the number of employees. We actually scale exponentially just like a traditional software vendor by focusing on the subscription, maintenance, third-line support for IT-users, OEM [Original Equipment Manufacturer] and ISV [Independent Software Vendor] customers. We look like a traditional software vendor that has forgone the upfront licensing revenue and makes its money on the maintenance revenue stream, which is, by the way, the scalable component. Bottom line: this is a fairly new, fairly disruptive model for software production. The employees of these companies believe that we are fundamentally changing the way infrastructure enterprise software is built, distributed, sold and supported.
Angel Mehta: For the most part, the application server market has been dominated by IBM and BEA. How did JBoss manage to gain any real market share?
Marc Fleury: First of all, JBoss has the number 1 market share in three out of the seven products we market. JBoss in the application server market is the leader with 34% utilization, IBM is number 2 at 33% and BEA is number 3 at 27%. Apache Tomcat is number 1 in its respective market. Hibernate is number 1 in the ORM [object/relational mapping] market.
We rose to dominance for simple reasons. The middleware market, in general, is still a moving target -- unlike an operating system or database where the technology itself is under flux. So actually there’s a lot of upheaval right now. There’s a renaissance of middleware design going on and we’re leading that renaissance with what we call ‘AO’, or Aspect Orientation, and tag programming which is a very lightweight model of programming. The technology is such a moving target that some of our competitors’ products look obsolete nowadays but we’re on the cutting edge and able to capture the number 1 market share.
Another trend that’s helping everybody is the increasing acceptance of open-source. Linux is definitely the Big Brother opening a lot of doors for everybody. It’s an interesting dynamic of adoption where, at first, you may encounter a little bit of insecurity in the user. They are uneasy about it at first but after they test it, they love it because it’s great software. The support structure, specifically in business models like Professional Open Source, is actually of extremely high quality and the price is right so what’s not to love? It’s the best of both worlds where you have free software AND the accountability and support services of a traditional software vendor. Right now you’re seeing a stampede to open-source, in general, due to the very unique dynamics present in the middleware market. Again, as I pointed out, a very young market with a lot of technology innovation going on, which has enabled us to capture, as a relatively small entity compared to our competition, the number 1 market share. We recently made it into the Gartner Magic Quadrant, along with Microsoft, BEA and IBM. I think we’ve witnessed the destructiveness of the Internet, in general, and the rise of businesses based on the Internet mode of development and distribution.
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