Nowadays, the way enterprises purchase and use a software is changing. And yes, we are talking about open source software which was an exception then and is a must now for enterprises. The reason, one can adopt the software for free of cost and and it is open to changes. When around 80% of enterprises are running on open source technology, we cannot deny the fact that open source is the new wave in the IT industry.
Why can be open source software better for enterprises?
You need to balance a whole lot of things when selecting a software for your enterprise. You need to go through the features of the software, validity and support given by the vendor, how much it costs for ownership, and your strategies for the growth of your company etc. Depending on all these things you can select the software for your company, be it open source or commercial.
With an open source software, you can have the access to the source code. There would be a community of the software where individuals can make changes to the code and give security updates and new features to the software. So, these software can be improved further.
Here are some advantages of open source software that attract enterprises:
Speed and Control:
The software you are using should give you agility that results in rapid product delivery and new innovations. With commercial software, you may need to wait to get updates of the software. But there is no such problem with open source software. And they need not wait for the updates from the vendor. They can make updates depending on their requirement thereby helping others.
Dealing with large scale data:
In the globalized world, software companies are providing their services to millions of customers. Commercial vendors cannot handle such a large number of users and the data. But there is a solution for this problem with open source software. The leading open source companies like Google, Yahoo, and LinkedIn etc. have shown solutions to such problems and contributed to the open source community.
Power to developers network:
Software service enterprises are encouraging their developers to use the open source software. Frontline software developers are much interested in the open source technologies as they can adopt, deploy and actively participate. With the network of developers in the community, open source software is seeing an exponential growth with better safety and security measures.
Business Model:
Many enterprises are thinking of how they can make money from their open source software. But if you plan clearly, you can make a business model for your open source software. There are two ways of doing this:
You can sell the enterprise versions of your open source projects. You can offer additional management and security features. Or you can offer SaaS (software as a service) with a premium service like pay-as-you-go model. This could be helpful for you as a revenue route when it is difficult to packaging all the components of open source software into a single cloud based offering.
Example of RedHat:
The executives of RedHat drew a clear sketch between their free user community of Fedora and RHEL (RedHat Enterprise Linux) product which is so sophisticated. Operation Executives and and CIOs who are their targeted buyers were giving value to the stability over the features of the product. They wanted a paid, enterprise-grade product that support their core LINUX applications.
RedHat executives observed this and maintained an open source community around their Fedora. They regularly updated it with new features for every six months. For people using the paid product, they marketed an enterprise-grade with security and optimization for Intel hardware. With these strategies, RedHat boasted a revenue of $1B. It also made LINUX a widely used server OS.
Licensing model:
You can determine the people who can modify your code with licenses that range from permissive level to restrictive level. There are some licenses that allow only the owners of the product to create derivative works on the original product whereas some allow any developer. To build a large ecosystem, permissive licenses are so useful. However, more permissive licenses may make it harder to create revenue and avoid fragmentation.
Sales cycle:
The sales cycle of the open source software is different from any other traditional commercial software marketing. For a commercial software, it is difficult to convince the users to use your product as they need to pay for it. In contrast with that, it is very easy to convince a user to use an open source software as they need not pay for it.
Conclusion:
With all this said, it is clear that we can make good money from open source software. To do it in a right manner, you need to focus from the beginning itself on monetization and licensing. You need to maintain your service team that your end users hardly face any problem. Almost all the enterprises are running on open source software, we can say that open source is the new wave in the software industry.
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Sumit Ghosh is the CEO of Socioboard Technologies and the marketing Head of Socioboard. Where he's responsible for the overall marketing strategy of
SocioBoard, including production marketing, positioning, demand generation and online marketing. Socioboard's new approach to open source social media management is changing how
Social Media Marketing companies, digital agencies, corporations and web/broadcast media across the world thinks about Socioboard.
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Business models for open-source software. Open-source software is widely used both as independent applications and as components in non-open-source applications. Many independent software vendors (ISVs), value-added resellers (VARs), and hardware vendors (OEMs or ODMs) use open-source frameworks, modules, and libraries inside their proprietary, for-profit products and services.[1] From a customer's perspective, the ability to use open technology under standard commercial terms and support is valuable. They are willing to pay for the legal protection (e.g., indemnification from copyright or patent infringement), "commercial-grade QA", and professional support/training/consulting that are typical of commercial software, while also receiving the benefits of fine-grained control and lack of lock-in that comes with open-source. Game Changing Business Models. The Money In Open-Source Software. Open-Source Software Companies Try a New Business Model. What is the business model for open source software companies that get acquired? There is no one answer here. As a prior answer said, many open core models have been acquired, but just as many pure open models have been acquired or succeeded. The open core model means that you do not open source all of your code. As mentioned, Pentaho did this, Zenoss does this, sugarCRM does/did this. You make the base functionality of your system work for most people. Then, you have value add softwarr, often aimed at the enterprise, that is not open sourced, that you sell on top of the open architecture / core system. Maybe they are implemented as modules that plugin to the core, or maybe as completely seperate software. But the business model is that you sell code that is not released to the public. This can sometime be contentious with open source purists. The pure open model is that all of your code is open - nothing is held back. I believe Ceph did this, docker is doing this, MySQL did this I think. They either make money from services and support, and integration, or they make no money and hope for someone to purchase them, or they work to bring devs and mind share to a wider company with other products. Another model is not as much a business model, but it allows an open source community to exist and thrive on its own... That of open source foundations such as Apache foundation, Eclipse foundation, Linux foundation and the self-made openstack foundation. They all operate as non-profit technically-oriented orgs. They are less a business but a way to hold the legal rights for the code and to host servers etc for the further development of the code. Google Business Software. Learn About Google's Powerful Online Office Tools. Try It Free! Flexible & Scalable · 24/7 Phone Support · Start Free Trial · 99.9% Guaranteed Uptime. Services: Productivity Tools, Professional Email, Easy Video Conferencing, Centralized Admin Console. Open-source software development Mumbai, India. Open-source software development is the process by which open-source software, or similar software whose source code is publicly available, is developed. These are software products available with its source code under an open-source license to study, change, and improve its design. Open Source Software Development Mumbai, India. The open source software development model differs from the closed source or proprietary model. Differences include the way the software is bundled or packaged and the roles played by participants. Both models also share common issues such as security and quality.
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