>One of the many lies in Silver Lake and WP Engine’s C&D was their claim that Automattic demanded money from them moments before our CEO Matt Mullenweg gave his keynote at WordCamp US.
>That is not true. Automattic asked for a verbal agreement that WP Engine would give some percentage of their revenue back into WordPress, either in the form of a trademark agreement or employee hours spent on core WordPress.
I'm not laughing. The whole Wordpress ecosystem was shown to instead be the personal fiefdom of a vindictive fool. A fool willing to completely destroy the reputation and trust of the ecosystem for what looks and smells like a personal vendetta.
The whole idea of the separate entities of Wordpress.org, the Wordpress Foundation (which we learned is somehow not the same as Wordpress.org) and Wordpress.com (through Automattic) is nothing more than a smokescreen. If you're in the business of competing with Automattic in delivering Wordpress hosting, start building an exit plan.
> >That is not true. Automattic asked for a verbal agreement that WP Engine would give some percentage of their revenue back into WordPress, either in the form of a trademark agreement or employee hours spent on core WordPress.
In the term sheet, it's phrased as:
> Commit 8% of its revenue in the form of salaries of WP Engine employees working on WordPress core features and functionality to be directed by WordPress.org.
So, pay for employees to be directed by WordPress.org (not Automattic or WordPress Foundation, apparently just Matt).
Well, it is true that money wasn't the only option.
And the quote is out of context.
The article also gives a timetable of conversations that happened between Automattic and WP Engine well in advance; therefore, the demands shouldn't have been a surprise, as claimed.
"2. Fee. In exchange for the License Grant, WP Engine shall do one of the following:
(a) Pay Automattic a royalty fee equal to 8% of its Gross Revenue on a monthly basis, within fifteen days
of the end of each month. "Gross Revenue" means all revenue generated by WP Engine from the
sale of its services, calculated without deductions for taxes, refunds, or other costs. WP Engine will
also provide Automattic a detailed monthly report of its Gross Revenue within fifteen days of the
close of each calendar month, including a product line breakdown of all revenues generated.
Automattic will have full audit rights.
(b) Commit 8% of its revenue in the form of salaries of WP Engine employees working on WordPress
core features and functionality to be directed by WordPress.org. WP Engine will provide Automattic
a detailed monthly report demonstrating its fulfillment of this commitment. WordPress.org and
Automattic will have full audit rights, including access to employee records and time-tracking.
It's hard to imagine how any one can read that as anything other than extortion, and at least, that WP Engine's claims are verbatim correct. The level of self-awareness in operation here is concerning, as in, it's kinda spiraling-out-of-control behaviour.
Is there much of a way back reputationally for Mullengweg and Automattic now? When does this start seriously impacting trust in WordPress, if it hasn't already? I'm bemused by it all.
8% of *gross revenue* is comical. That's easily their entire profit margin, if not more so. It's hard to imagine anything so out of touch with reality.
The only way out of this would be, "im having a mental breakdown, i'm retracting everything, please bear with me for 6mo"
> 8% of gross revenue is comical. That's easily their entire profit margin, if not more so.
The cheapest wordpress hosting plan they have is $20/month. Even if they gave every site its own dedicated hardware (they dont), gross margins would be over 50%. Since their hosting infrastructure is shared, actual gross margin is probably over 90%.
8% is still an unreasonable ask, but it shouldn't be anywhere close to their entire net profit.
But OTOH spending 8% of gross revenue on developing the core of all their products and services isn't ridiculously high. It may well be more than typical, but not ridiculously so.
Well it's basically saying, just give us the money. The "audit rights" only apply if they're donating time, so they want that to be the most difficult and intrusive option -- ie., its only there for PR.
The choice is, "some money and we'll look the other way; or open all your books, and donate 8% of your workforce to wordpress"
Attempts to go fishing in such records would be pretty unlikely to succeed; it'd be an uneforcable request contrary to public policy, with no relevance to such an audit. It would be correctly and easily fought.
WP Engine generates $400 million [1] in revenue vs. $ 1.3b (2021) [2]. The size of user bases and revenue could play a critical role in court decisions. If I were WP Engine, I would consider assembling a dedicated team ('tiger team') to develop a WordPress alternative or clone, preparing for potential long-term strategic pivots.
> One of the many lies in Silver Lake and WP Engine’s C&D was their claim that Automattic demanded money from them....
That is not true. Automattic asked for a verbal agreement that WP Engine would give some percentage of their revenue back into WordPress
This is probably the strangest post I have read in a long time.
"They claim that we demanded money from them around these dates.. not true!"
"So here is the demand for money that we requested they sign, around these dates"
Maybe I'm not reading this correctly but... it seems like the most obvious interpretation.
Also, what is the purpose of listing all these dates when the two companies met? Without knowing the content of these discussions, this list doesn't remotely meet the community's request for transparency.
- money directly to Automattic, not the WordPress Foundation.
- employees working on WordPress core, at the direction of Automattic - including looking at their time sheets and employee files.
Neither of this is "back into WordPress", it's "to Automattic". The company that often did prioritize their workers to work on features benefitting WordPress.com users. There actually used to be a constant for checking if running inside WPCOM in WP Core, but they seem to have removed it since. Let's not even talk about Jetpack and carving out shit from your core product, that gives me too many AOSP vs Play Services vibes.
Either way, WP Engine is a competitor of Automattic. This is laughable. I hope they fork WordPress, because I'd feel uncomfortable contributing software to the benefit of such a bully (I am a former contibutor).
I thought the structure was set up in such a way that only Automattic has commercial rights to the Wordpress trademark. To balance this, Wordpress.org has discretionary power on deciding whether Automattic are good stewards of the trademark. Can Wordpress.org directly ask for the 8%? It seems like it has to be done through Automattic.
This whole situation was handled poorly, but can it really be considered bullying? It definitely speaks to the heart of the eternal problem of open source: the imbalance of givers and takers at the bazaar.
Matt Mullenweg has said that the WordPress Foundation, which is separate from WordPress.org (it gets confusing), could revoke the licenses that he (personally?) and Automattic have.
The license that exists for WordPress.org, which seems to really be just him, doesn't appear to be public. It would be interesting to see who it really is with and what the terms really are.
Honest question because I have no idea what the truth of the matter is: who even is WordPress.org?
According to https://news.ycombinator.com/item?id=41692300, Matt Mullenweg said at some point in that long interview from a couple of days ago that he was operating WordPress.org personally, rather than the WordPress Foundation as I think people would typically assume.
Yes, I'd say Automattic puppeteering Wordpress.org, the org set up as a visible layer of separation, to make their competitor look back and then poach their customers (https://pressable.com/wpe-contract-buyout/) is bullying, or "market distortion".
Matt's just mad he didn't capture the enterprise Wordpress hosting market earlier, with WordPress.com always being aimed at more casual users and Pressable only aquired in 2016.
> Matt's just mad he didn't capture the enterprise Wordpress hosting market earlier, with WordPress.com always being aimed at more casual users and Pressable only aquired in 2016.
WordPress.com VIP is a thing though, and I think they've done a great job selling it to huge organisations.
I've used Wordpress since 2006, when, in need of a dynamic website, and not knowing any programming language, I managed to build my own custom WP theme within a couple of weeks. WP's ease of use has always been its main asset. I've built dozens of professional custom themes for paying clients for the best part of a decade.
However, two aspects of WP that were always pain points were: local development and hosting. That's where WP Engine provided solutions.
While being more expensive than other platforms, hosting a WP website with them is a great experience, whether in terms of installing, managing, or reliability.
And recently, I had to update an old WP instance for a client. Having no local install available, I looked into new tools to setup one. Turns out WP Engine's tool called "Local" is what Automattic should have provided 10 years ago. It's a fantastic piece of software that "just works"!
It seems like Automattic feels jealous that another company managed to build upon their own open source product to provide a better experience in every aspect (development, managing, hosting) and are making bank. Good for WP Engine.
So, to be clear: if I want to start a company using wordpress as core technology, I should expect to be extorted for around 8% if I get successful enough.
I cannot imagine "Automattic" has thought this through. There is no ransom agreement in open source, and the very basis of wordpress' success is the absence of such a thing.
What company now, looking at this technology, would touch it with a 100ft pole?
I am not sure if I understand this correctly but this is about using the WordPress trademark not using WordPress in itself. So I think you would be fine if you are offering it as a general website hosting.
I mean I guess using "WP" in their business name is kinda pushing it I guess, but offering Wordpress hosting while using the word "Wordpress" is fair game (IMO). A company can't/shouldn't be able to tell someone they can't use the trademark name in describing the service another company offers. How would that even work? "We offer hosting for the project that 80% of the websites in the world use!". If Wordpress (the project/company) allows someone to offer hosting of that project (ie: it's not a mongo type licence), they can't expect someone to not even use the name of the project they are offering hosting for.
Imagine if Linus prevented companies from saying they offer hosting using Linux.
They've always been actively protecting their trademark. Also small companies or meetups using WordPress were asked to change that. I think they even have to do that legally to some degree to protect their trademark.
WP Engine has build their success on piggybacking the WordPress trademark, their slogan is "Most Trusted WordPress Hosting and Beyond".
It's probably fair they pay a fee for that.
If they would just use the open source software & would market it as a blog-hosting they would most likely be in the clear.
And it has been a standard in this industry for decades (e.g. LAMP) that saying 'X Hosting' does not mean that you should be considered the owner of X. It just means you host it.
It's complicated. The trademark is indeed owned by The Foundation but they have granted Automattic an "exclusive, fully-paid, royalty-free, perpetual, irrevocable, worldwide, sublicensable right and license to use and otherwise exploit the trademarks". This is only just coming to light.
So the Foundation appears to only own the trademarks on paper. Despite that, this is how Matt Mullenweg framed the trademark ownership situation to the community:
"the most central piece of WordPress’s identity, its name, is now fully independent from any company." he also claimed that Automattic had "give[n] up control" of the trademarks. Those statements are demonstrably untrue.
The claim is that, while WP is legal, it is “WordPress Engine” that was also used (in press releases or tolerated in the writings of 3rd parties), alongside “WordPress Core”, a plan which they later renamed.
I don't know if this changes anything, but I'm guessing a lawsuit is coming, so we shall see. But it would be great if people did some research before commenting on the story.
Whenever someone's asking for 8% of gross revenue, they've lost the plot regardless of the underlying claim. For most businesses that's easily much more they're taking in profit. One imagines were this agreement in place, WPEngine would have to raise their prices to levels beyond what any customer would pay.
Likewise, the use of "wordpress" as a trademark is clearly permitted when referring to wordpress; it's a common part of trademark law that you can refer to products in this manner. WPE customers do not think WPE is wordpress, it's a host.
> Similarly, a business related to WordPress themes can describe itself as “XYZ Themes, the world’s best WordPress themes,” but cannot call itself “The WordPress Theme Portal.”
Yeah when I go to WPEngine site it feels like they copy-pasted it.
This is the thing about open source is MOST people do not contribute anything. And we’re seeing this trend with the whole Continue.dev situation too. Copy-paste, rebrand, make some money.
I think everyone needs to consider what the O.G. Wordpress team has created—and how many hours of blood, sweat, and tears went in. And then some folks just copy-paste and siphon out their business.
They explicitly allowed it. If you don't want to be taken advantage of, put it in the license. It's honestly hard to feel sympathy for companies that release a product under a what some meme circles have called a "cuck license"¹ and then complain when some other entity adheres to the license.
I genuinely can't believe some of what I'm seeing, as I said in another comment. If this is all Mullenweg, he needs some form of oversight right now telling him to stop communicating.
The thing that bothers me most about this ordeal is there’s now a “hidden license” for WordPress. If Mullenweg thinks you’re not giving back enough, then free software is no longer free. Rather than a specific term sheet and a list of meetings, I would like to better understand when this new license comes into effect. At the moment it seems like it’s only required when Mullenweg is upset with you. I wrote a bit more to this effect here: https://anderegg.ca/2024/09/28/the-hidden-wordpress-license
This has always been the case with all Open-Source products contributed by companies, due to the complexity of IP laws.
Patents are the most problematic. It's why it's important, for instance, for the OSS license to also include a patents-grant that applies to derived works as well, something that (at least in the past) companies like Microsoft and Facebook failed to provide.
Furthermore, even Open-Source foundations and non-profits have trademarks that they protect. Once upon a time, Debian had problems with patching Firefox, as Mozilla did not accept the modifications, leading to a Debian-specific rebranding:
This issue is also about the free use of WordPress.org APIs. This is like expecting forks of Chromium or of Android to have continued (free) use of Google Play. Obviously, Google Play is not really included in the OSS deal, and it is only through the continued benevolence of Google that alternatives still have access to it.
A non-profit organization partners with a for-profit company to demand payment from the for-profit's competitor, straight into the for-profit's pocket (assuming the WP Foundation has total control over wordpress.org).
I don’t understand why Automattic is involved at all. I imagined this was between Wordpress dot org and WP engine or whatever. Nobody should ever have to pay automattic a dime. I came into this conversation fully in support of Wordpress dot org but the more I read into this the more it feels like I didn’t understand the situation between automattic and Wordpress dot org at all.
I’m leaving the conversation thinking the relation between automattic and Wordpress dot org is one of tax avoidance. What am I missing?
WordPress dot org is basically fully funded and operated by Automattic. It seems that by default a WordPress installation will use WordPress dot org for many features and capabilities. WP Engine leaves this enabled on their hosted sites, so each WP Engine customer is effectively getting free access to an Automattic funded resource. Automattic wants to get paid back for this use, either in money or developer resources.
Automattic's desire seems totally reasonable. Their execution of expressing that desire seems to be totally unreasonable.
Except there is a "Donate" link in the wordpress.org footer, which leads to The WordPress Foundation's donation page. On that page, it states: [0]
> The WordPress Foundation is a 501(c)3 non-profit organization...
I don’t find it reasonable for a non-profit organization to demand payment from users to one of its donors, Automattic, instead of encouraging donations to itself.
It had more comments than upvote-points, HN automatically buries high comment to point ratio threads to avoid incitement. Not sure if that applies here, just throwing that out as a possible explanation.
The thought did cross my mind that, given the focus it has had on HN over the past few days, there may be a concerted effort to try and bury things like this where the sentiment is overwhelmingly against WP/MM/Automattic. Tinfoil hat territory I know, but this really did drop like a stone. It's really the only time in all my years on HN I was genuinely surprised to not find the post 'where I left it' on the front page after a few minutes away.
I’ve been fascinated by this WordPress story, but HN seems to really dislike it. I’m assuming mods are pushing posts like this down, but I’m not sure what rule/norm they're breaking?
"Extortion" does feel like the appropriate word to use in this case, I say only partly in jest - there's certainly been coercion or threats, having seen Matt's messages to WP Engine before his conference appearance.
Automattic and Mullenweg continue to surprise me at seemingly every turn. I also find some of the language being used ostensibly BY Automattic in these blog posts just incredible, coming from what is supposed to be a respected and respectable organisation. I'm seriously considering whether to ever use WordPress again for projects.
I can only repeat what I said the other day. This is all a huge pile of bullshit.
Automattic does not like the competition, so they pick one actor in the WP ecosystem _randomly_ and try to force this on to them.
For anybody who is running a service that uses WP this is a threat. You can't be sure that if you build on that ecosystem that one day Matt Mullenweg does not like you and will try to extort money from you, too.
>That is not true. Automattic asked for a verbal agreement that WP Engine would give some percentage of their revenue back into WordPress, either in the form of a trademark agreement or employee hours spent on core WordPress.
Tomato-Tomato. Comedy gold.
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