The deal brings together two rivals of low-cost collaborative software tools that are well-known brands in the open source community. It includes CollabNet’s SubVersion, whose design was initially led by Brian Behlendorf, one of the founders of the Apache Software Foundation. On the other end is VA, better known as publisher of a number of open source and developer media and portals including Slashdot, Linux.com, Freshmeat, and other outlets.
The result of the transaction is that both companies are changing from rivals to partners that stick to their knitting: CollabNet as collaborative development tools provider, and VA, which retains its developer media empire.
As for the products involved, there is significant overlap between CollabNet Enterprise and SourceForge enterprise, in that both are multi-user source code control systems. The SourceForge offering has drawn roughly 200 customers, while the CollabNet counterpart has about 100 customers, but for a product with deeper functionality, consulting offerings, and more lucrative engagements.
But a major difference is that, while the brunt of CollabNet’s experience on the commercial side has been through software-as-a-service (SaaS) offerings, SourceForge has been primarily sold as packaged software. CollabNet president Bill Portelli said that the deal provides complementary channels, in that SourceForge has experience delivering packaged software, while CollabNet has the hosted side, plus a growing consulting and service arm that the other lacked.
Portelli expects the deal to become accretive within a quarter undoubtedly because probably a modest amount of cash is at stake. More importantly, over the past year, CollabNet has been on a roll. The last three quarters have seen 70%+ year over year growth. Portelli said that the company has become cash flow neutral, and has a 1.5 years worth of client engagements in the pipeline.
A closer look at adoption of SubVersion, the open source version control product that is CollabNet’s best-known offering, shows a growth curve that began spiking about 18 months ago, growing fivefold to over 100,000 downloads from Apache servers. The commercial side of the business is that CollabNet hosts a web-based on demand site fir virtualizing the software build and test infrastructure and planning development. And it provides an Eclipse Mylar plug which simplifies the organization of developer task lists.
For the rest of the year, CollabNet has promised to continue supporting both packages, and by year end will begin planning how to converge the products.
Our View
This deal clearly brings two of the best known brands in the open source software development field together, and so is hard to ignore.
At first glance, the deal appears to be a case of a vendor acting to eliminate the competition. A closer look reveals that each company had differing strengths, and so in the long run, it probably makes sense for VA to exit the software field and concentrate on its business of providing media and portals to developers.
Anyway the original open source SourceForge engine, which got its name, got forked out long ago after VA decided to take the product commercial. The original open source code base for SourceForge was forked by the GNU project as Savana, and later on by another community member as GForge.
Obviously, those moist affected by his deal are those who subscribed to the SourceForge engine, as it’s not yet clear what will survive once CollabNet divines it product convergence strategy.
But the other interesting part of the deal is that CollabNet is starting to feel its oats, and might be getting a bit overconfident. It now has Rational in its sights, and while IBM Rational has hardly bothered to update its decade-old ClearCASE product, CollabNet has a ways to go before it comes close to market parity, That said, given IBM’s inaction with its rational product line, such an outcome might not be as outlandish as it seems.
