OCV companies build commercial open source software (COSS) based on open source projects. The open source core will always be free and open to the community.
Sample Pricing Tiers
Buyer-based open core pricing models tend to have three paid tiers with a large price difference between the tiers.
ㅤ | Good | Better | Best |
Potential Buyer | Individual Contributor | Managers / Directors | Executives |
Price / Unit / Month | Free (Open Source) | $$ | $$$$ |
Pricing is the same regardless of how the application is hosted.
See additional pricing considerations here.
COSS Risks
COSS companies face the risk of service-wrapping by the hyper clouds. Ways to manage this risk include developing application software and adopting a buyer-based pricing model.
Infrastructure software
What the application software is built on top of (MongoDB, Confluent, Redis) | Application Software
The top-level application that people interact with (Wordpress, GitLab) | Fork & Commoditize Resistance |
Application Programming Interface (API) | Graphical User Interface (GUI) | GUI is more complex to replicate than API |
Single-tenancy | Multi-tenancy | Hyper clouds are better at running single-tenant software |
Needs lots of compute power | Needs little compute power | Hyper clouds are in the business of selling compute and storage. Applicaiton software tends to drive less compute. |