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 / Year | Free (Open Source) | $$ | $$$$ |
Pricing is the same regardless of how the application is hosted. Annual subscriptions are recommended over monthly subscriptions.
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. |