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July 27, 2009 5:37 AM PDT

Zoho's winning strategy: open source + cloud

by Matt Asay
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These days, it's virtually impossible to avoid open-source software. If you're a Web company, don't even bother trying.

That's the message I got from a conversation Friday with Raju Vegesna, evangelist at Zoho, a leading competitor to Google Docs. According to Vegesna, the company--formerly known as AdventNet, now called Zoho Corp.--has been around for 13 years, and has always used free, but not necessarily open-source, software as part of its strategy. The company has released software under open-source licenses before, including the somewhat controversial vTiger project.

With 1.8 million users of Zoho.com, growing at roughly 100,000 new users per month, and profitability expected in 2009, Zoho's use of open-source software offers a glimpse into the development strategies of the next generation of software companies.

As Vegesna explains it, "In 2003 we were trying to determine whether to go open source or SaaS. We opted for both." Expect to see a lot more "both" software strategies going forward: open-source software inside with a cloud delivery strategy, and open APIs to give external developers access to that cloud.

Q. Tell me about how and where you use open source at Zoho.
Vegesna: We are completely open-source at the core of Zoho, from the operating system (CentOS) to the database (MySQL) to the application server (Tomcat) to Hadoop for scaling our systems.

Do you modify any of these projects and, if so, do you contribute back those modifications?
Vegesna: Yes, at times we modify open-source software to meet our needs, but often, like with the operating system, we don't modify the source code. We simply strip it down to the essential components that we need, thereby improving performance and security. But for other areas, we may modify a project like MySQL to improve scalability.

As for contributing back, it depends. If our changes help us but likely won't help the community, we won't contribute them back. But if it's code that would help the general community, like a security improvement, we contribute that back, unless it's something proprietary to our business. Whether the community accepts and incorporates it, however, is up to it.

Technically, we could do the same thing with proprietary software but the cost would be prohibitive. Imagine Google trying to run 600,000 servers on Windows.

Could Zoho.com exist if it were built with proprietary software?
Vegesna: Technically, we could do the same thing with proprietary software but the cost would be prohibitive. Imagine Google trying to run 600,000 servers on Windows. Could it do so technically? Probably. But it's doubtful that it could give so many different services away for free if built on pricey, proprietary software.

Without open source I can't imagine SaaS [software as a service] taking off. The economics simply wouldn't work.

Open source gives us flexibility so that we can add our own layers of business logic. For example, we use OpenOffice for document conversion. There are some conversions that OpenOffice doesn't support, however. Because it's open source, we can split the code to allow our proprietary software pick up the slack where OpenOffice can't handle transformations.

Most of our applications are built from the ground up by Zoho. Ninety-five percent of our employees are engineers. We use open source strategically but we need to be able to understand our code intimately, so writing it ourselves is important.

We use the best of open-source software, contribute back strategically, and write our own software where it makes sense.


Follow me on Twitter @mjasay.

July 1, 2009 8:07 AM PDT

John Chambers' video vision: Shortsighted

by Matt Asay
  • 10 comments

Cisco Systems CEO John Chambers calls video "the killer app," but apparently, he hasn't been paying attention to trends on the Web, or even to his company's own emerging-collaboration story.

Video, while great, takes too long. We e-mail, instant-message, and tweet for a reason: it's short and to the point. Who has time to watch a video each them they want to communicate?

Perhaps even more critically, as Hampus Jakobsson pointed out to me (over Twitter, no less), video "requires full attention--the scarcest of all resources."

Cisco gets this. At least, groups within Cisco get this. That's why Cisco Senior Vice President Doug Dennerline's WebEx team has been adding presence and instant messaging through Jabber, e-mail through PostPath, and more to its Web-conferencing suite.

It's also why Cisco will almost certainly add some form of office productivity suite to WebEx, despite protestations to the contrary from Alex Hadden-Boyd, director of marketing for the collaboration software group at Cisco. (Apparently, Hadden-Boyd didn't see the memo from his boss, Dennerline.)

Zoho, anyone?

Zoho is a leading competitor to Google Apps and, in many areas, actually surpasses Google Apps. While some of Zoho's applications directly overlap with Cisco's current products, the sheer breadth (and, in some cases, depth) of its office productivity and collaboration story must be intriguing to acquisition-hungry Cisco.

Some suggest that Google will struggle to make it in the enterprise due to security concerns with Google Apps. Cisco doesn't have that problem. Its brand oozes "enterprise." As such, it may well be Cisco that changes the face of enterprise computing...by initially changing the way we communicate and collaborate within the enterprise.

Just don't hold your breath for video to part the waters. Video has its place, but it's a highly verbose form of communication, and the Web's most popular technologies increasingly teach us to speak sparingly.

Indeed, I think that we'll see Cisco acquire Control Yourself, the company behind open-source Twitter lookalike Identi.ca, before it changes the world through video.


Follow me on Twitter @mjasay.

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About The Open Road

Matt Asay brings a decade of in-the-trenches open-source business and legal experience to the Open Road, with an emphasis on emerging open-source business strategies and opportunities. Matt is general manager of the Americas division and vice president of business development at Alfresco, a company that develops open-source software for content management. He is a member of the CNET Blog Network and is not an employee of CNET. Disclosure.

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