After years of struggling to swim against the tides of open source and cloud computing, traditional software vendors are clearly under fire. At the same time, it’s also clear that open source is driving most of the big trends in technology today, from mobile to cloud to Big Data.

What isn’t clear, however, is that going forward all technology vendors will become Red Hat.

Open Source’s Outsized Impact

Ten years ago, a new open source company or project was news. Not anymore. Open source dominates mobile, with Android displacing the seemingly unbeatable iOS in both smartphones and tablets. Open source also dominates cloud, with every significant cloud platform except Azure built using open source. And even Azure treats open-source technologies as first-class citizens on its platform. And open source dominates Big Data, with Hadoop and NoSQL technologies the major forces used for managing the world’s data explosion.

But open source is more than software.

Now we have “open source” car and bike sharing in Minnesota, an open source village cellular network in Mexico, open source data centers and more. While not truly open source—many of these projects don’t adhere to the Open Source Definition and don’t even try to do so—each indicates just how pervasive open source’s impact has been.

Indeed, open source is so big, it has even taken over Dilbert:

Which is not, of course, the same as taking over the software industry.

Wither The Traditional Software Vendor?

Back in 2007, SugarCRM CEO Larry Augustin keynoted the Open Source Business Conference, and relayed a disturbing fact: over time, open-source companies tend to become more like the legacy vendors they displace. Augustin analyzed the P&Ls of, Red Hat and other vendors and came to the conclusion that “by year six, the financials of an open source company tend to look identical to that of a traditional proprietary software company.”

Why? Because ultimately open-source companies, like the traditional vendors they seek to displace, must also rely on expensive sales and marketing machines to get to scale. The laws of business gravity still apply.

Not surprisingly, many open-source vendors also look like traditional vendors almost from the start, in the sense that they combine open source and proprietary software (usually tooling and add-ons) to acclerate sales. In the Hadoop market, Cloudera uses this so-called “Open Core” model, while Hortonworks does not. While it remains to be seen who will win the long run, in the short term Cloudera leads the market and will reportedly have over $100 million in sales in 2013.

At the same time, legacy tech vendors have embraced open source when it suits them. EMC has built a Big Data solution around Hadoop. IBM has made billions by selling hardware and software solutions around open source, with a mega services business also heavily dependent on open source. Old dogs sometimes can learn new tricks, apparently.

No One Can See The Open Source Future

As such, while it seems a safe bet that open source will continue to grow, it’s less clear that this will be the end of traditional vendors like IBM, SAP or Oracle.

As Marten Mickos, CEO of Eucalyptus, an open-source cloud vendor, suggested to me in an email exchange:

We said [open source would eliminate proprietary vendors] 10 years ago, too, and then VMware came from nowhere and became 4-5 times Red Hat’s size. AWS is built on open source, but it isn’t open itself. DynamoDB and EMR compete against open source without supporting open source.

I don’t want to sound negative on open source. I just don’t think it’s necessarily possible that it will win everything in infrastructure.

For companies like Oracle I guess it’s too early to tell whether they are like DEC or like IBM. The former disappeared, the latter remains.

It would be convenient to draw a line in the sand and call for the death of everything old and the elevation of everything new. But it would also be wrong. The history of what has succeeded and what has failed in open source is messy and inconclusive. We shouldn’t expect the future to be any different.