Development Seed Sell Drupal Work to Phase 2

Development Seed today announced the sale of their two Drupal-based distributions, Open Atrium and Managing News, to Phase2 Technology.

Open Atrium is one of the most acclaimed products built on Drupal, and work on it led to the development of many key modules that are now used to build large enterprise sites - such as Features and Context.

Phase2 has been collaborating closely with Development Seed for some time, and has used a lot of Development Seed’s work to develop OpenPublish and OpenPublic.

Meanwhile, Development Seed had appeared to be overburdened by the amount of work required to maintain their large range of important modules - while at the same time pushing forward on their innovative new projects. It had also proved difficult for them to commercialise their work on distributions. Meanwhile in recent months they have been focusing more on mapping projects, and developing on node.js. They’ve had a lot of success in this field, and are building a solid reputation worldwide for their mapping work.

The statement issued today doesn’t specifically say DevSeed is taking a significant step back from the Drupal project as a whole, but it does make it look more likely. We broke this news last week, and it seems to be confirmed by Eric Gundersen, President of Development Seed today, who says simply:

“For Development Seed, this sale creates investment resources to push forward with our latest mapping and node.js work.”

It will certainly be a setback for the Drupal community if such a prominent shop steps away from the project to any significant degree. We’re seeking interviews with Eric, and with Phase2, and will bring you more updates and analysis as we have it.

Update: Fed 22nd 12:39 UTC

The CEO of Phase2 Technology, Jeff Walpole, has now released a statement too. Key passages are:

This move is unprecedented in the Drupal community and we are excited to venture into new territory as Drupal continues to grow into enterprise markets. Development Seed has been an amazing contributor to the Drupal community with an unparalleled enthusiasm for the research and development of new applications and solutions in Drupal, including these two innovative products and many excellent framework contributions. We are proud to continue the development and support of their work, and to continue providing community contributions to the underlying components of these solutions.

Going forward, this move is great for the Drupal community. It helps to validate the business viability of open source and shows a maturing of business models. Development Seed is focusing its efforts on developing new products – which is their strength, and we’re focusing our efforts on taking a suite of Drupal products to market – which is our strength. It enables us to craft a wide range of expandable platforms for the markets and customers we serve. This partnership also allows Development Seed to push forward faster with their groundbreaking mapping work and node.js. So expect more great things from them.

Update: Feb 22nd 12:45 UTC

Eric Gundersen, President of Development Seed has given his first interview on the news to Drupal Radar. he says:

“Products really need to match a companies culture in every aspect to be able to succeed. There is no doubt that we are a product company through and through, the trick now is to get the the business model around the products to be just right for our team. In this case, a bigger team like Phase2 can scale to better serve Open Atrium commercial support.

Re Open Atrium specifically, we love this product. We are dog food people and built this really for ourselves. Our internal Atrium has over 32,000 nodes and 72,000+ comments. We love how many people come up to us saying they use it and how much it helps their team. It is going to be huge to have good commercial support around. All I can say after knowing the market for Atrium in the last two years is that Phase2 is not going to have trouble selling support packages, the demand is huge. Spoiler alert: the new open atrium site that we will launch with Phase2 tomorrow is just sick looking :).

This investment gives us the opportunity to focus more on product development. As for our future, I can tell you that the products we will release will be much more in the web services business and that business model around support of say a hosted service works better for our team than running a larger support program. And while this mapping work is Drupal agnostic it is going to work awesome in Drupal :).

In short the last two years have been a lot of learning about where we should focus to cause the great positive impact. In the end we see huge potentials thought partnerships like Phase2 and we are more fired up than ever to be positively disruptive.

As for distros and Drupal, I think having a large market leader like Phase2 that is pushing for distros to be built the right way is going to have huge positive benefits for a lot of other smaller teams that are building products. Phase2 will help raise the level discourse and force the market to realize that it is hard to build a good website, but there are some smart architecture approaches abounding treating Drupal as a product that have real benefits.”