Automattic CEO Matt Mullenweg is engaged in a heated legal battle with Silver Lake, the majority owner of WP Engine, over trademark violations and business practices. This conflict threatens to disrupt the typically harmonious WordPress ecosystem.
More than two decades after starting WordPress, Matt Mullenweg finds himself in the most intense battle of his career. His company, Automattic , is taking aim at buyout firm Silver Lake , the majority owner of WP Engine, an ordeal that's escalated into an ugly legal fight.
On Thursday, Mullenweg acknowledged that many of his employees disagreed with his position, and some of them took a buyout package.Matt Mullenweg, who turned 40 in January, has now spent more than half his life working on WordPress. He's never had such an insane two weeks.currently using its templates, tools and plugins. But the WordPress universe is a complicated mishmash of open-source products, nonprofits, for-profit companies, trademarks and licenses. The typically quiet but extremely important part of the internet — WordPress powers roughly 40% of all websites — has suddenly emerged as a major source of tech industry drama, threatening to upend an ecosystem that's long been viewed, from the outside at least, as collegial, thanks to its longevity and the various fun-loving camps and learning sessions it hosts every year. While WordPress' technology is open source, meaning anyone can install it and use it for free, Mullenweg is also founder and CEO of Automattic, a venture-backed startupanywhere from $4 a month to over $25,000 a year for services like ad products, security, customer support and inventory management. The saga that burst into public view in September featured the normally mild-mannered Mullenweg as its central character in a battle with WP Engine, one of the leading providers of WordPress hosting. Silicon Valley private equity firm Silver Lake bought a"I've been doing WordPress for 21 years, I have good relationships with every other company in the world," Mullenweg said in an interview this week with CNBC.his attorneys sent to the company on Sept. 23, revolves around years of trademark violations and WP Engine's claim that it's bringing "WordPress to the masses." "We at Automattic have been attempting to make a licensing deal with them for a very long time, and all they have done is string us along," Mullenweg wrote in aon his personal website, ma.tt. "Finally, I drew a line in the sand, which they have now leapt over."Since then, the matter has escalated on an almost daily basis. WordPress took the drastic step of banning WP Engine from using the WordPress resources necessary to serve its customers, which preceded a lawsuit filed on Wednesday by WP Engine against Mullenweg and Automattic. Mullenweg then put out another post, calling WP Engine's suit "meritless," and announcing that he'd hired Neal Katyal, former U.S. acting solicitor general, for legal defense."What are the legitimate ways of monetizing open source and does the commercial entity created by the authors — how much control should they have with the commercialization efforts?" Tunguz said. In this case, "hundreds of millions in revenue is at stake between the two," he added.In Mullenweg's telling of the brouhaha, the battle has been years in the making. He's been actively trying to strike a deal since January and finally got fed up, he said. But to the outside world, it all felt very sudden. Mullenweg first referenced the matter in public on Sept. 17, in aahead of WordCamp, the largest annual gathering in the U.S. of WordPress users. The four-day event took place in Portland, Oregon, beginning on Sept. 17. In the post, Mullenweg criticized WP Engine for not contributing enough back to the WordPress ecosystem. He said that Automattic contributed 3,786 hours per week to WordPress.org, compared to 47 hours for WP Engine. For businesses and developers considering who they want to support, Mullenweg had this message: "Silver Lake doesn't give a dang about your Open Source ideals. It just wants a return on capital." A Silver Lake spokesperson said WP Engine was handling all inquiries. A WP Engine representative referred to the company's complaint against Automattic and Mullenweg, filed on Oct. 2. The spokesperson highlighted the introduction of the complaint. "This is a case about abuse of power, extortion, and greed," the filing begins. "The misconduct at issue here is all the more shocking because it occurred in an unexpected place — the WordPress open source software community built on promises of the freedom to build, run, change, and redistribute without barriers or constraints, for all. Those promises were not kept, and that community was betrayed, by the wrongful acts of a few——to the detriment of the many, including WPE." On Sept. 20, three days after Mullenweg's initial post, the WordPress founder showed he wouldn't be backing down. In his keynote, at an event that attracted an estimated 1,500 WordPress fanatics, Mullenweg warned the audience upfront that it "might be one of my spiciest WordCamp presentations ever." After reading out his prior blog post, Mullenweg took swipes at Silver Lake, even naming a partner at the firm, Lee Wittlinger, as the man behind WP Engine, comparing him to a "schoolyard bully." Prior to taking questions, Mullenweg said of WP Engine's presence at WordCamp, "they're not going to be at future ones, I don't think." The next day, in a post titled, "WP Engine is not WordPress," Mullenweg wrote that even his mother didn't know the difference, and he said WP Engine is "profiting off of the confusion" and "needs a trademark license to continue their business."Bob Perkowitz, president of environmental nonprofit ecoAmerica, told CNBC that he's known Mullenweg for 16 years and is even an investor in Auotmattic. For a number of his organizational and personal websites, Perkowitz said he's long been a WP Engine customer. Tuning in remotely, he heard Mullenweg's WordCamp presentation. "I always thought that was part of WordPress," Perkowitz told CNBC in an interview, referring to WP Engine. "They're misleading, and they don't contribute to the community." Perkowitz said he's having his website administrator migrate all of the websites to different hosting companies. Following Mullenweg's presentation, WP Engine sent Automattic's legal chief a cease-and-desist letter on Sept. 23, due to what the company called Mullenweg's self-described "scorched earth nuclear approach." The letter said Mullenweg had demanded a payout of a "very large sum of money" before his WordCamp keynote, and WP Engine didn't pay up.that WP Engine had been banned, meaning it "no longer has free access to WordPress.org's resources." Mullenweg encouraged WP Engine's thousands of customers to contact the company "and ask them to fix it." WordPress then temporarily unblocked WP Engine and gave it until Oct. 1 to agree to terms of a licensing agreement, which Mullenweg made public. The crux of the deal is that WP Engine would agree to a royalty fee of 8% of monthly revenue to Automattic or commit 8% of revenue "in the form of salaries of WP Engine employees" working on WordPress features for WordPress.org.To the universe of WP Engine customers, Mullenweg's actions were harsh and clumsy. Mullenweg says that what his critics don't understand is how long he's been trying to come to a deal. "They've been delaying forever," Mullenweg told CNBC. He decided, "I'm going to finally start talking about the evil stuff you're doing unless you talk to me," he said.Far from negotiating, WP Engine on Wednesday filed its explosive lawsuit against Mullenweg and Automattic. WP Engine accuses Mullenweg of slander and libel due to his public comments and says the WordPress founder has numerous conflicts of interest in how he runs the community and his company, give the open-source nature of the technology. "Over the last two weeks, Defendants have been carrying out a scheme to ban WPE from the WordPress community unless it agreed to pay tens of millions of dollars to Automattic for a purported trademark license that WPE does not even need," the lawsuit says. "Defendants' plan, which came without warning, gave WPE less than 48 hours to either agree to pay them off or face the consequences of being banned and publicly smeared." Following WP Engine's demands for a jury trial in its 61-page lawsuit, Mullenweg fired back, describing the complaint as "baseless" and "flawed, start to finish." On his personal website, Mullenweg acknowledged that the ordeal was causing a big internal clash at his company. "It became clear a good chunk of my Automattic colleagues disagreed with me and our actions," Mullenweg wrote. He says he made the decision to offer buyout packages for anyone who resigned before early afternoon Thursday, offering $30,000 or six months of salary, whichever is higher. Anyone who took the deal wouldn't be eligible to "boomerang," a term for getting rehired. Mullenweg said that 159 people, or 8.4% of the workforce, took the offer while the 91.6% who opted to stay turned down a collective $126 million."I'm grateful and thankful for all the people who took the offer, and even more excited to work with those who turned down $126M to stay," Mullenweg wrote. "As the kids say, LFG!" Mullenweg may be openly enthusiastic and grateful for the employees he still has on board, but the WordPress community is a mess. Many WP Engine customers are suffering, and Automattic is gearing up for a legal fight against a private equity firm with over $100 billion in assets.
Wordpress Automattic WP Engine Silver Lake Matt Mullenweg
United States Latest News, United States Headlines
Similar News:You can also read news stories similar to this one that we have collected from other news sources.
The messy WordPress drama, explainedWordPress cofounder Matt Mullenweg is facing backlash after calling a rival hosting platform WP Engine a “cancer” to the WordPress community.
Read more »
The ‘WordPress’ fight is now a lawsuitWP Engine is suing WordPress co-founder Matt Mullenweg and Automattic following a public spat over the WordPress open-source project and trademark.
Read more »
Matt Mullenweg: ‘WordPress.org just belongs to me’During an interview with The Verge, WordPress cofounder Matt Mullenweg said WordPress.org “belongs to me” and addressed the dispute with WP Engine.
Read more »
Matt Mullenweg Tightens Grip on WordPress Ecosystem Amidst Feud with WP EngineWordPress co-founder Matt Mullenweg asserts control over the platform's future, blurring lines between WordPress.org, Automattic, and the WordPress Foundation. His conflict with WP Engine highlights concerns over open-source contributions and potential ethical breaches.
Read more »
Texas House District 66: Dallas Morning News recommendsIncumbent Republican Matt Shaheen faces Democrat challenger David Carstens.
Read more »
Why WordPress founder Matt Mullenweg has gone ‘nuclear' against tech investing giant Silver LakeMatt Mullenweg, who founded WordPress more than two decades ago, finds himself in a legal battle against Silver Lake over the firm’s ownership of WP…
Read more »