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Business in open source? Go for cloud
By siliconindia
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Friday, 04 December 2009, 18:41 IST
Bangalore: If entrepreneurs are looking to make a living from open-source software, then they should use the cloud platform advises Bernard Dalle, General Partner of Index ventures. He thinks that at a time when enterprises may be less willing to spend on software, they're increasingly interested in spending on the operation of that software through cloud computing, an interest that can be bought...and sold. The cloud isn't simply a clever way to provide social-networking services but may well be the best way to monetize enterprise-facing open-source software, he said to CNET.
While commenting on whether cloud computing spells the end for open-source businesses, Dalle said "I think it's good news. I don't think open source is going away. It's here to stay. The world is increasingly moving to a hybrid world: a combination of on-premises and cloud computing. We're not going to see a 100 percent cloud world. If I look at our portfolio, even our "open-source companies" like Pentaho, OpenX, and DimDim are turning to the cloud to monetize their open-source software assets. Open source provides a convenient on-ramp and off-ramp for customers, helping them evaluate the software at low to no cost and also gives a free (as in cost and as in freedom) exit in case things go wrong. Between that entrance and exit is a ripe opportunity to make a lot of money by delivering value to customers."
Dalle further explained that open source helps vendors reach customers through low-cost distribution, but cloud computing, importantly, makes the open-source software palatable to a class of customer that finds open source too risky, yet has no problem using it when hosted.
"The other big trend, not related to open source, is cloud-on-cloud: cloud services running on other clouds. It used to be that everyone ran their own data center, but now an increasing number of companies are happily running their services on Amazon EC2 or other public clouds. This dramatically lowers the cost of starting a service, and starting a company around it. This might raise the concern that we'll see too many open source/cloud companies, not too few," said Dalle.
