Facebook Takes TIP in New Direction as Investors Doubt Open Source Payback

Social networking giant faces a backlash on its open source commitment and says it will start a new group with a RAND licensing model.

Iain Morris, International Editor

June 8, 2017

4 Min Read
Facebook Takes TIP in New Direction as Investors Doubt Open Source Payback

In a bid to overcome startup and investor doubts about open source technology, social networking giant Facebook is setting up a new group within or alongside its Telecom Infra Project (TIP) that will support the licensing of network technologies on "reasonable and non-discriminatory" (RAND) terms, Light Reading has learned.

The move reflects concern about the business model surrounding open source technology, Facebook acknowledged, and risks upsetting open source players that have regarded the Internet behemoth as an unwavering ally.

Launched in early 2016, TIP was conceived as a challenge to the slow-moving network equipment industry and has been taking advantage of open source code and software to speed up the development of new low-cost and innovative technologies. (See Facebook: TIP Will Open Telecom Hardware.)

Operator members such as Germany's Deutsche Telekom AG (NYSE: DT) and France's Orange (NYSE: FTE) have made a strong commitment to open source technology as they look to accelerate innovation and cut ties with vendors building proprietary systems.

Open source vendor advocates such as Red Hat Inc. (NYSE: RHT) have prospered by selling support services and subscriptions around open source code, which is made freely available to the wider community.

But the model has its share of critics. "I have yet to understand why we would open source something we think is really good software," said Ulf Ewaldsson, the head of digital services for Sweden's Ericsson, in a recent conversation with Light Reading. (See Open Sores: Are Telcos on a Collision Course With Vendors?)

Unlike Finnish rival Nokia Corp. (NYSE: NOK), Ericsson AB (Nasdaq: ERIC) is not currently a member of TIP, although Facebook executives say they talk with the company on a regular basis.

The latest rumblings about open source, however, have come from at least one of Facebook's startup partners as well as sections of the investment community.

A small developer of virtual radio access network (or V-RAN) technology, Amarisoft was this week chosen along with three other startups to receive support from both Facebook and Orange as part of a new initiative aimed at bolstering young telecom infrastructure players. (See Orange, VCs Commit $113M to Network Startups as 'Black Box' Frustration Mounts.)

But Amarisoft CEO Franck Spinelli lashed out at TIP during a pitch to investors and Orange executives in Paris earlier this week, blaming TIP's commitment to open source for the lack of progress his business has made.

"We don't want to let our technology go for nothing. We want money for that and if you take the approach of open source it has to be free and so there is incompatibility there," he said. "We are losing time… I don't know what to think about TIP and what your real intention is behind that but I have been disappointed so far with this project."

For more NFV-related coverage and insights, check out our dedicated NFV content channel here on Light Reading.

Responding to the criticisms, Steve Jarrett, who heads up infrastructure partnerships for Facebook in Europe and the Middle East, revealed that Facebook was evolving partly toward a RAND model as opposed to one based entirely around open source.

"There is a new group starting that will not have an open source license because that is obviously very difficult for investors to invest in," he said. "So the new group will have a RAND license which is a lot more investable. So the timing is really good now for us to take advantage of your technology and share it with other TIP members."

RAND licensing is typically associated with standards-setting organizations striking deals with companies that hold standard-essential patents. It is an approach with which Ericsson is very familiar. (See Patents Prizefight Pending: Clash of the Tech Titans.)

Jarrett also indicated that V-RAN is one of the biggest priorities for mobile operators that have been talking to Facebook about their future network needs.

Speaking to Light Reading on the sidelines of the investor event, Bertrand Rojat, the deputy vice president of Orange's Technocentre R&D unit, expressed sympathy with Spinelli's comments and said that a balance would have to be found between open source and proprietary technology.

"He is saying my business model is not advertising or end-user subscriptions and that I'm a software guy and so I need to license my product, which is just common sense," said Rojat. "[Open source] doesn't mean there is no proprietary overlay on what you are developing -- we have to find the right balance."

Deutsche Telekom's Axel Clauberg, who has been closely involved with TIP, denies there are concerns about the open source business model and says that RAND moves reflect "the IPR [intellectual property rights] reality we are facing in this industry."

"TIP is dealing with more than just open source," he said in emailed comments. "We are dealing with hardware, and we are working in patent-rich areas like mobile."

Working groups in TIP have been able to decide between RAND and "royalty-free" rules from the very outset, added Clauberg.

— Iain Morris, Circle me on Google+ Follow me on TwitterVisit my LinkedIn profile, News Editor, Light Reading

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About the Author(s)

Iain Morris

International Editor, Light Reading

Iain Morris joined Light Reading as News Editor at the start of 2015 -- and we mean, right at the start. His friends and family were still singing Auld Lang Syne as Iain started sourcing New Year's Eve UK mobile network congestion statistics. Prior to boosting Light Reading's UK-based editorial team numbers (he is based in London, south of the river), Iain was a successful freelance writer and editor who had been covering the telecoms sector for the past 15 years. His work has appeared in publications including The Economist (classy!) and The Observer, besides a variety of trade and business journals. He was previously the lead telecoms analyst for the Economist Intelligence Unit, and before that worked as a features editor at Telecommunications magazine. Iain started out in telecoms as an editor at consulting and market-research company Analysys (now Analysys Mason).

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