Matt Mullenweg: Open Source Needs Help from SaaS

WordPress Jetpack

Last week I was fortunate to go to Pressnomics for the first time. It was a really great conference that focused on business growth, particularly in WordPress.

The event caused some controversy for a quote on the last day. Matt Mullenweg, the co-founder of WordPress was taking some questions from Josh Strebel, the host of Pressnomics.

Matt’s company is Automattic and they make a plugin called Jetpack which provide 30+ services, all wrapped up in a single package. Some of those services are paid, some are free and several rely on the SaaS capabilities of WordPress.com.

Josh asked Matt whether Jetpack was a trojan horse for Automattic to sell even more paid services in the future. (link)

Matt replied that the purpose was very different, “In the absence of Jetpack, I believe WordPress would be declining”. (link)

That caused a real shock in the audience and a lot of debate afterwards, in the room, on Twitter and on blogs. I think some attendees found it hard to imagine WordPress market share declining and even harder to imagine it being saved by a plugin like Jetpack.

photomatt pressnomics

Josh and Matt at Pressnomics. Thanks to Betsy Cohen for the photo.

There’s a bigger story here about open source

The debate about Jetpack is interesting, but I want to talk about the bigger picture.

I think the importance of Jetpack is an indicator of the limitations of open source in 2015.

The Pressnomics sessions were not recorded, so the most accurate quotes I have for Matt are from Twitter. Here’s some of what he said:

  • “Naked WordPress (without plugins) is not competitive to Wix, Weebly, Squarespace”. (link)
  • “Look at attrition rates on JP/non-JP sites, or run some new user tests on http://l blow you away.” (link) In short, there is objective proof that default WordPress is too difficult for many users and Jetpack improves on-boarding.
  • “There’s secular decline of non-mobile, non-social publishing systems.” (link) WordPress doesn’t have a great mobile or social experience and so we should natually expect it to be declining without help from outside source like JetPack. Anecdotally, I heard at the conference that Matt is placing enormous energy into refocusing Automattic on mobile. Everyone is getting re-trained, company priorities are now centered on mobile and we will likely see new or improved WordPress apps soon.

Beyond the quotes on Twitter, I’m going to paraphrase some of what I heard from Matt. Apologies henceforth for any misquotes or misunderstanding …

Matt seems to think the WordPress has The Innovator’s Dilemma. The WordPress development community is locked into protecting its existing user base and revenue streams. As an industry becomes successful, that always brings a lack of mobility and an unwillingness to risk change.

Currently, the WordPress community isn’t thinking broadly enough and doesn’t fully appreciate the threat from services such as Wix, Weebly and Squarespace. Matt seemed to be prodding the audience to take these threats much more seriously.

Matt also seemed to be suggesting that there are real limitations to what open source can do alone:

  • The open source development process can’t move fast enough to keep up with SaaS companies who can push out updates every day.
  • The open source community isn’t well suited to building high-quality apps, particularly for platforms such as iOS.
  • Open source by itself can’t provide many of the tools that SaaS can such as a CDN service, easy video hosting, security monitoring.

Here are some much longer quotes from Matt, talking more about the intersection of open source and SaaS.

My thoughts

It’s possible I’m cherry-picking some of Matt’s comments, but I wanted to write about them because that’s the way I’ve been thinking lately, as anyone who’s argued with me about auto-updates knows.

  • I no longer hear end users compare WordPress to Joomla or Drupal. When I’m talking to small business owners, they’re making a choice between WordPress and services such as Weebly, Wix and Squarespace. Website statistics are awful and probably don’t fully reflect the use of these SaaS services. Drupal has about 1 million active websites, whereas Wix claims (take this with a pinch of salt) over 57 million users.
  • We talked about SaaS in our predictions for 2015. The most successful open source projects in 2015 will be those who combine the best of open source and SaaS. It’s worth remembering that WordPress powers over 20% because it has a SaaS product already. WordPress.com users are about 50% of all WordPress users already, so it’s fair to say that WordPress is already a SaaS-first product.

So here’s the tldr

The real threat to open source’s market share is SaaS. To survive, open source projects need to offer some of their own centralized SaaS tools otherwise they’ll lose the low and middle end of the market.

Whenever I talk with developers about the threat of SaaS, they think I’m crazy. Even at Pressnomics after Matt’s interview, a lot of people were dismissing these SaaS services as toys. Maybe I’m wrong, but I wonder if they’re too focused on the codebase and on enterprise users?

Over to you, I’d love your thoughts on this …

Instructor

  • Steve is the founder of OSTraining. Originally from the UK, he now lives in Sarasota in the USA. Steve's work straddles the line between teaching and web development.

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Michael Dorchain

WordPress is a developer, web designer centric platform. It’s not out of the box a user friendly. While the ecosystem is huge, nothing is really made for end-users. This is one of the reason why premium template marketplaces are doing so well. Not everybody want to mess up with plugins or can afford the rates of a developer. Even fully featured themes can have a serious learning curve for most of the end-users.
This is where SAAS website building services come in. They provide a user friendly service out of the box. They may not be as featured as WordPress but they provide to the end users a better experience and a reasonable cost.
Most developers would say WIx, Weebly and others are just some jokes, but they aren’t end-users. Not taking these SAAS platform seriously would be a mistake. In less than 2 years, they already have eaten a good part of the market and will continue. WordPress will keep its community eventually but won’t grow more than they do.
So I think you simply have a point with your conclusion. It’s a matter of market positioning and focus. Will WordPress be more community or end-user focus in the future? Why not both?

cnielsen

Interesting post and great seed of thought to be planting right now.

John Coonen

Matt obviously read our Joomla SWOT Analysis we conducted and presented last year. Same conclusions: The need to respond far more quickly to changing market demands, and not get stuck in the Innovator’s Dilemma. Move to SaaS was one of many of our solution points. Quick point of order, Steve, I’d say Matt characterizing this as an “Open Source” community issue is inarticulate. It’s a brand-specific, group-specific challenge. There are plenty of examples of fast-moving, innovative Open Source developers and groups that are front and center on the evolutionary chart, some gobbling up the legacy coders. WordPress as one Open Source group may be lagging behind perhaps, but not “Open Source” itself.

steve

Thanks John
Do you have any good examples of projects you’d highlight?

Melanie Sumner

@michael Dorchain, I have to disagree- I think you could use WP right out of the box. It’s nothing a developer or web designer would ever really love, BUT you really could. I think we just are around it too much and have a bevy of plugins that we just install by default because we know it will make it better.
All the cool kids are now offering differing levels and services: an open-source product and a much more supported, polished enterprise product. I don’t think Jetpack should be singled out for doing the same (and I don’t use Jetpack at all because last I knew, they sold your data). I think that WP runs into a rock and a hard place- if they start integrating features that are commercialized plugins now, the very fickle internet community could possibly turn on them- “why develop a good plugin? WP will just make the feature later.” WP can just easily get so bogged down- difficult to use for administrative/content people. Slow if it’s not set up properly or the multi-site is just TOO big. I really think a lot of sites that would be better off using something that makes everything much simpler, like Perch. Sometimes you don’t need a WP heavy-lifting situation.
I think it should be kept in mind that anything said by anyone with a significant interest in JetPack continuing to make money is that OF COURSE they are going to try to make JetPack look like the second coming, just without as many angels singing. It’s marketing and salesmanship and it wouldn’t be bought if you didn’t feel like he actually believed it himself. So maybe he’s delusional to an outside person- but his job is to sell more, be more, make more. Taking what he says with a grain of salt is probably a practical approach.

careytech

I think Matt is correct. But I don’t see this as SaaS-vs-open source, rather as competition among the evolving do-it-yourself options.
At the Joomla World Conference I presented an Ignite talk that bifurcated CMS-based projects into do-it-yourself versus client-driven. The client-driven project assumes that there is a client who hires skilled professionals to build custom and advanced solutions – using professional tools and deep skillsets. This is the niche for which I think Joomla is well-suited and ought to pursue.
In contrast, WordPress arguably has positioned itself as a tool for the do-it-yourself end users, so naturally they are competing more with other do-it-yourself options. Putting aside established WP brand loyalties, SaaS can offer a more seamless service and thus more appeal to the build-it-yourself users. And to do-it-yourselfers, having less to learn and less to monitor is more important than brand (or the code base). It seems to me that SaaS is a real threat within the niche that WP has staked.

Techjoomla

Interesting post.. My thoughts are definitely inline with Matt’s line of thinking. Opensource applications forming the base of cloud platforms with the cloud platform contributing back is a nice win win for both.
With Cloud apps moving faster and reaching more’end’ users that’s a great way for open source applications to propagate themselves in a more consumer friendly form. Bundles as PAAS, businesses can offer enriched special services and features on top of the base platform while making sure the base platform grows as well.
Parth

morktron

I’ve stopped offering [url=http://Wordpress.org]Wordpress.org[/url] site to clients with a lower budgets and set them up instead on Squarespace or [url=http://wordpress.com]wordpress.com[/url].

1. Security, maintenance, optimisation – they can’t afford to pay me to maintain their sites and they are understandably unwilling to learn. So there is really no other option.

2. Ease of use out the box – with a bit of effort using plugins and custom post types you can really make WP super easy to use for the client, but of course it costs more than the lower end of the market can afford / is willing to pay.
Joomla is sadly no longer an option anymore due the version jumps which require complete rebuilds. Suitable only for companies with in-house web devs.

Dan Knauss

I think you’re right Steve — WordPress developers you might meet at Pressnomics don’t see and don’t care about WordPress losing market share at the middle and the low end. They are trying to widen the enterprise market at the top, and it’s tough going. Everything “beneath” them is likely to be a joke, a toy, and irrelevant. They are keen on differentiating themselves.
High level WordPress developers are notoriously underpaid, underpriced, or

both. Rather than take responsibility for this or consider problems they can actually solve, many blame the stereotyped “amateurs” and “lightweights” who sell WordPress to the middle and the bottom of the market for putting a blemish on the “WordPress developer” brand. So of course they’re not predisposed to see or care about a looming decline in WordPress’ market share due to Squarespace, Wix, Weebly, TheGrid, etc. If/when those services take a big chunk out of the middle and bottom, why should developers care? Does the low and middle end of the market really matter to them? Do they care about “democratized publishing?” Does anyone?
I also agree with all the commenters here, despite their apparent differences. Maybe everyone’s describing the same elephant from different angles?
WordPress was the easiest web publishing engine to get started on, use, extend, customize, and maintain around 2009-2012. After that it started losing ground but not market share, and it’s become increasingly attractive as an all-purpose application framework. [url=http://WP.com]WP.com[/url] and Jetpack aren’t the only reason why market share hasn’t decreased — there’s also been an explosion of managed application hosting for WordPress, an increasing number of people selling and servicing WordPress based sites, and a booming market of people selling to people who sell WordPress. This ecosystem is highly distributed and not very deep or lucrative for most people in it. It’s possible, as some are predicting, that the likes of Squarespace will carry the market away.
Wix and Weebly look pretty bad to me, but I have looked at them a lot less than Squarespace, which is only about a year younger than WordPress. ([url=http://TheGrid.io]TheGrid.io[/url] is also getting mentioned a lot now, and it’s not even public yet.) Squarespace is in something like its 7th major version now, right? I’ve checked it out periodically, and it’s been impressive for a long time. For someone with a little time, skill, and not much of a budget, it’s great. It beats [url=http://WP.com]WP.com[/url] and WPw/Jetpack IMO, so it may well take over the commoditized middle and bottom of WP’s market, which is in a race to the bottom on price.

Tom N

I’ve spoken on this topic many times at WordCamps, DrupalCons, etc. and always get the same questions after the talk – “How can I make Google Ad money?” “How long does it take?” My belief is that we’re headed toward a time where almost everyone will have a “Personal Web Business”. Not a brochure, but an income producing site. A solopreneur.
I hear the same request almost daily from non-techies, mainly they want the almighty Google Ad Dollar as a steady monthly income. The new american dream. Since WP is the most approachable dynamic platform that you can heavily manipulate without coding, it’s an awesome answer. Drupal is too difficult, SquareSpace and Wix are very limited, cost too much over time, and are too impersonal.
WP is the mamma bear with enough tweakability plus ease of launch to dominate the small business $1,000 to $10,000 budget world. The support system is self taught “bedroom web designers” who’ve taught themselves bottom-up to do many things on top of WP. I think WP is safe in this niche for now. If anything new comes along like Grid, it will take some time for this unsophisticated market to move over.
Matt and WP should be more concerned about the markets above them.”Real” programmers, who are language-adept and can add a significant amount of value, enhancement, UI, security, speed and overall professionalism are in a little holiday right now, because many businesses with a budget of $30,000 all the way to $300,000 are willing to stretch WP as needed (or Drupal, or Angular). This is a whole different game, one where I think WP is most vulnerable to losing market share to more modern stacks and automation. Larger development teams want different tools. They’re more enamored by Google and Angular and Node and NoSQLs, the future. WP and PHP and MySQL are quite old technologies, the PHP job market is shrinking, etc. But then again angular and node are based on javascript.
WP is being attacked from below and above, a classic mature market problem. If Matt wants to continue to grow it rapidly, he’ll probably have to pick one direction, and he’ll probably go down market and take some of that back. Maybe take some ideas from grid’s playbook.
You can’t deny to power of the WordPress platform and brand name; they’ve done so many things right and have built something that no one ever has before in the internet age (except maybe Zuck but his motivation is much less pure). Autommatic has also done amazing things for the “solopreneur” and has been highly rewarded for it. They’ have raised $317 million in venture capital, $286 miilion in just the past 2 years.
So I wouldn’t start worrying about WP-death yet. Matt has reinvented it and used a just in time strategy for a decade, and he will continue to do so. What will they do? Who knows, they can’t even know that yet, but they will. @tomnora

Nicholas Blanchard

Seems like a race to the bottom not to the top to me, at least from a developers perspective. Trying to simplify WordPress to be even easier than it already is. I mean it’s not exactly a bad thing, but I would much rather service platforms that cater to customers with money to throw at me not looking for the cheapest quickest way to build a website. Kind of happy I left the WordPress legacy codebase behind.

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