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Making money with open source

SpikeSource CEO Kim Polese explains the money-making and money-saving opportunities being created by the open source development model.

Kim Polese
Kim Polese, CEO, SpikeSource

Kim Polese believes that the remaining obstacles to making money with open source are dwindling away. And she ought to know. In April, Polese presented a session on the topic at the LinuxWorld OSBC conference. Her numerous accolades include being named one of Time magazine's Top 25 Most Influential People in America. Some sources credit her with naming "Java" during her long stint at Sun Microsystems, and she was one of the co-founders of Marimba. As CEO of Bay Area open source services provider SpikeSource, Polese guides the company's vision of "making open source safe for the enterprise." In this interview, she talks about how companies are leveraging the open source model to enhance their bottom lines.

Open source software is creating new market opportunities and new companies are springing up to take advantage of these opportunities.
Kim Polese,

You've said that "far more money will be made because of open source, rather than with open source software." In a nutshell, how will enterprises make money because of open source? Are they making money with open source right now?

Kim Polese: Open source software is creating new market opportunities and new companies are springing up to take advantage of these opportunities. An example is SugarCRM. They sell open source CRM [customer relationship management] applications and have been in business since August of 2004. They provide a lower- cost alternative to CRM leaders like Siebel and Black Duck Software and Palamida are defining another new category -- providing compliance and license management services around open source software.

A completely different example is Digium, a hardware PBX [private branch exchange] device maker. They figured out that VoIP [voice over Internet protocol] was the future and created Asterisk, a VoIP PBX software application, and open-sourced it -- and they've now established themselves as a leader in the VoIP PBX device market, because Asterisk is helping drive greater hardware sales. And then there are new consulting companies like Optaros. And, of course, systems companies like IBM and HP are driving more hardware and services revenue through their use of Linux. IBM was able to generate significant new revenue from installing Linux on mainframes, breathing new life into the mainframe market. All of these companies have found creative ways to leverage open source to solve business problems.

Of course, RedHat is the best example of a pure-play open source company that is making money with open source via the support model they pioneered.

Is interest in open source picking up at large companies? Why or why not?

Polese: We're seeing interest from companies of all sizes. They have been locked in by proprietary software vendors for a long time and they are looking for flexibility. Smaller companies are adopting open source because it's less expensive to acquire and they can modify it themselves.

What is the biggest barrier to open source adoption in the enterprise? How can developers and the open source community overcome it? How can the enterprise?

Polese: What I've been hearing from CIOs and IT managers is that they need a reliable, cost-effective way to ensure the interoperability of the open source components with the rest of their infrastructure and applications, and they need someone to rely on for integrated technical support and documentation. The open source community has evolved a thriving support ecosystem, but hasn't had the centralized infrastructure to deliver the integrated testing, certification and support that companies who depend on open source require. That's why SpikeSource was founded.

It sounds like one of SpikeSource's main interest is in promoting interoperability between various open source and proprietary applications. What are some of the ways you do that, or help developers and companies to do that?

Polese: Everything we do promotes interoperability -- that's the focus of our company. We've built a test harness that runs over 22,000 tests every time code changes. We test many open source projects for free and publish the test results on our Web site. For our customers, we test, certify and support the components they need to run their businesses.

What are open source testing tools? Who can use them and how will they benefit the enterprise?

Polese: There are a bunch of open source tools available. Just to name a few, there's httpUnit for Web-based testing, jUnit for performing unit tests, jMeter for performance testing and Simpletest for PHP unit tests. They will be used primarily by developers and they definitely make life much easier. The company benefits because the testing tools facilitate automation of repetitive tasks and enable reporting. Plus, they are very low cost compared to the alternative commercial tools.

More Information:

Former Java exec now heads SpikeSource

Emic CEO: Open source platforms to get more support

You've been quoted as saying that SpikeSource tests, certifies and supports various "stacks" of open source software tailored for enterprise customers, and that you're a "services company." Could you expand on that? What are some real-world examples of services you provide?

Polese: SpikeSource tests open source components in conjunction with other open source components and also with proprietary software. A by-product of testing for interoperability is the compilation of stable open source stacks, such as LAMP or LAM/J. However, the nature of open source software is that the code is constantly changing, so companies that use open source software have to continuously search for security updates, patches, fixes and bugs and then determine which of these to use. For enterprise IT departments, we provide updates services, technical support and customer stack validation.

The SpikeSource update service provides software updates, coupled with highly technical information about the updates, so IT managers can make informed decisions about whether and when to install them. What makes this service particularly appealing to CTOs, who worry about the risk of mission-critical applications going down, is that each time a patch or update is discovered, SpikeSource runs it through our test harness to make sure it's stable with the entire stack.

We also offer incident-based technical support for open source software. We provide our clients with 24x7 support, so they have one reliable vendor to call for all of their open source interoperability needs.

What you'll find is that many companies are adopting open source software, but they all have different needs, so we also offer custom stack validation. This means that our customers can tell us what products and technologies they want to use, and what versions, and we can test these in combination and certify them as stacks. We can then also provide update services for these custom stacks.

In addition to supporting enterprise IT departments, we also support ISVs. We test and certify their applications with open source software and can provide their customers with technical support and updates services on the underlying stack.

Have you worked with open source enterprise resource planning software? In your experience, is it catching on in companies? Does SpikeSource certify or support any ERP software?

Polese: Today, we're focused on middleware necessary for Web-based applications and integration problems. We're just starting to expand up the stack. In terms of ERP, CRM is one part of the solution and we're working with SugarCRM to test and certify their applications on Windows and Linux. In order to run Sugar, you need Apache Web Server and a MySQL database. We've tested, certified and pre-configured a stack and also built a one-click installer so a customer can be up and running in under 15 minutes.

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