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Open source tools: SMB Buying Decisions

Definition: Open source software consists of any program whose source code is readily available for modification by users and developers. The development process usually takes place in a public arena,

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resulting in quick fixes to bugs and unique applications to handle processes specific to one industry. Open source software generally is free, but users and developers are on their own if they have questions or want to develop a particular application.

Benefits of open source tools

There's no doubt that small and medium-sized businesses (SMBs) can save money by moving applications to an open source model that doesn't require licensing fees like that of proprietary software.

More on open source tools

Smaller businesses take another look at open source

Open source vs. SaaS: What SMBs should know

Bernard Golden, CEO of Navica Inc., an open source strategy consulting firm in San Carlos, Calif., worked with a $30 million technology-intensive company that saved $500,000 a year by moving its Java 2 Platform, Enterprise Edition application server from a BEA Systems Inc. WebLogic environment to an open source solution from JBoss Inc. in Atlanta. "Oh yeah, you can save money on open source, but it depends on the application and the company," Golden said.

SMBs should stay within their comfort level in terms of technology and adoption of open source, experts say. A company with a dedicated IT department probably has experimented with open source and could select and implement an open source solution on its own, said Maria Winslow, an open source strategies consultant based in Chapel Hill, N.C. "It depends on the organization's level of expertise in general," Winslow said. "In general, if you have Linux people, they'll be ready to deal with Linux. If you have a Microsoft shop, you might not be ready."

However, companies that outsource IT functions or use integrators would want to hire a consulting firm or integrator to help pick a solution and implement it. While the software generally is free, a company is on its own for tech support, which must be figured into the total cost of ownership. "If [the software] is an important part of your infrastructure, you may want to pay for support," Golden said, "but you're under no obligation to do so."

One popular open source alternative is OpenOffice.org, the freeware version of the Microsoft product. Both Winslow and David Hauser, CTO at GotVMail Communications LLC in Weston, Mass., recommend running it over the Windows operating system. Hauser completed the transition for the 18 employees at GotVMail this spring and reports few problems. The company, a telecom that provides virtual phone service to small businesses, also runs the Firefox Internet browser instead of Microsoft's Internet Explorer.

Open source tool tips and gotchas

Hauser said there was initial pushback from some users about having to migrate to new software, and one advanced spreadsheet user encountered a problem he resolved on his own in about an hour. Hauser advises SMBs to avoid new open source products and those that don't appear to be robust.

Chad Hock, U.S. president of TimeXtender, a Greensboro, N.C.-based supplier of business intelligence tools, said SMBs should look at what they are trying to accomplish and then begin evaluating both commercial and open source software. "The SMBs I talk to don't want to deal with [open source]," Hock said. "They want to plug and play and move forward." Companies using open source may come up against patent issues, so they should know fully the implications of the software they're using, Hock added.

Open source product sample

Application servers: www.JBoss.com
Sales force management: www.SugarCRM.com
Content management: www.Alfresco.com
Database management: www.PostgreSQL.com
ERP: www.Compiere.com
Operating system: www.Linux.com

Expert viewpoint: Maria Winslow, open source strategies consultant and author of The Practical Manager's Guide to Open Source

"The way I see it, there is nothing innovative about open source. The innovation is in the process and relationship between the producer of the software and the consumer of the software, who have much more influence on the software they use.

"Larger companies fuel the improvements, but SMBs get to use that. It's a unique arrangement that allows [development] costs to be shared across the users, but those costs can trickle down. It's brought a freer market to software."

Expert viewpoint: Bernard Golden, CEO at Navica, an open source consulting company

"Open source is having a very significant impact on the software industry. The old [proprietary software] business model is breaking down.

"I come from an ERP background, and the [commercial] development process is a lot like watching sausage being made. Those developers are not gods, they're strapped for time, and quality, frankly, is always a lower-order issue. It's not impossible to get quality, but it's not a priority."

Matt Bolch is a contributing writer based in Atlanta. You can read more about him at www.mattbolch.com.


This was first published in August 2006

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