The focus this week has been on the viability of 3rd-party vendors and their viability in the medium term. However, other than the outright shutdown of infrastructure or defunding resources, there is another smell to keep in mind:

License changes.

This is more common with altruistic tech companies that start with a tech idea to change the world. Then they become popular, and before you know it, there is substantial adoption. Think of projects such as Mulesoft, Spring, and Docker. They have all started as open source project to gain traction and ascertain market fit.

Once this happens, then the quest to ascertain product market fit begins. For those that have become successful, then they will change the licensing model in one of two ways: by splitting their core offering from the real product, or cripple what is opened up to the world.

There is a third option, that comes up from larger companies where they will close up what was once open. Think of what Oracle did with Open Solaris post-acquisition of Sun Microsystems.

Normally licensing changes happen for two reasons:

  1. From the original company, they are looking to increase revenue to ensure the company remains viable.
  2. If they were recently acquired, then this is the parent company looking to increase the revenue from their investment.

This is another “it depends” scenario. Elasticsearch changed their licensing model as a protective mechanism against their core product offering being exploited by a competitor (in this case AWS).

In the news recently are two companies: HashiCorp which owns and maintains Terraform, and Cockroach Labs that maintains Cockroach DB. Both companies have started adding restrictions to their terms. However, HashiCorp has been around a while longer and there have been inquiries about them looking to sell.

This is why it depends. Depending on the strength of the company and their business model will dictate their viability in the longer term. In some cases, it leads to the strengthening of their position and surviving long term under another umbrella. In other cases, it leads to the company ceasing operations and those dependent upon it finding another path.