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May 23, 2007

Open Source Outlook Pondered

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(InfoWorld Daily Via Thomson Dialog NewsEdge) Dignitaries from the open source arena pondered the paradigm's future at the Open Source Business Conference in San Francisco on Tuesday, anticipating even greater ubiquity.

Executives from companies such as SpikeSource and Ingres offered, as would be expected, a rosy outlook for open source during a panel session entitled, "The Future of Open Source: The Good, the Bad and the Ugly."

"I think open source will increasingly be part of the mainstream software business," said Kim Polese, CEO of SpikeSource. "Open source is going to be a primary component of any successful software company going forward," she said.

One panelist said a business does not need to be defined as an open source company but needs to stress value. "I don't think you have to define your business as being an open source business," said Billy Marshall, founder and CEO of rPath. "I think you simply have to define your value in a very clever way and make certain to preserve the ability to monetize it."

Open source usage means not having to reinvent things, Marshall said.

It was pointed out at that no open source company has come along in the past five years with the statue of Red Hat (News - Alert).

"There has been no $100 million-plus open source software company built yet," added moderator Michael Skok, general partner of North Bridge Venture Partners.

Skok polled the audience on a number of issues and also related recent survey data about open source. One survey result said half of all software is expected to be open source in five years. Pondering the issue of subscriptions as a means to generate revenues, panelist Tom Berquist, executive vice president and CFO of Ingres, said Wall Street likes subscriptions.

"The Street wants subscription revenues," Berquist said. But customers prefer perpetual licensing, he said.

"I think the majority of licenses ultimately will be subscription-based," Polese said. ISPs and hosters will offer software, she said.

Survey responses indicated no application area is safe from open source, including middleware, accounting, ERP, portals, health care, and even e-learning.

"I don't think there's any area of software that's by definition not vulnerable," to open source, said Polese.

She also said she expected it would be a Web-based desktop leveraging Web services that would be the mainstream, open source desktop offering.

During an earlier panel session entitled, "Online Strategy for Open Source Business," panelists commented on how rules pertaining to how their software is accessed online.

SugarCRM's John Roberts, chairman and CEO, said the company does not ask for any personal information. Zend Technologies' Mark de Visser, chief marketing officer, said the company's site experiences millions of downloads per year but does not even know the e-mail addresses of the downloaders.

"The way we look at it is, anybody who is using our product and downloading it is not using our competitor's product," and might be inclined to buy training and consulting services, de Visser said.

He noted though, that online downloads does not mean sales in a lot of cases. "At least when you look at the percentages, it is so attractive to think 'If I could double that, it would be attractive for my business,'" said de Visser.

Plenty of areas are available for new leaders in open source, Roberts said. "The second you stop innovating, you're going to be surpassed," said Roberts.

Copyright 2007 InfoWorld Media Group, Inc.

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