The Open Road

ReadWriteWeb lists 10 of its favorite Web applications that have disappeared from the Web. In so doing, it calls out a problem with cloud-based applications that lack an open-source license: once they're gone, they're really gone.

I've mentioned before enterprises that have desperately tried to get their proprietary vendors to open-source their code, only to see the vendors go bankrupt and take their code with them. No, having source code access wouldn't necessarily guarantee an easy future for such customers, but not having the source code ensures that there is no future for the product and its long-term utility for the customer.

Savio Rodrigues suggests that source code access is "not all that it's cracked up to be." Try telling that to those that have relied on software only to find it, or its vendor, disappear.

In the cloud, it's even worse, as not only does the vendor disappear but so does all trace of its products. At least in my example above the customer had the perpetual right to the outdated code. In the case of the cloud the vendor's death is simultaneous with the code's demise.

Yes, cloud computing offers tremendous promise. It also has the chance to create significant peril for those that rely upon it. I therefore like the model, used by Loopfuse and others, that provides cloud/software-as-a-service-based software with the backup of an open-source license on that code to enable the code to outlive the vendor of it. Consider it a hedge on the longevity of the software service.

Disclosure: I am an adviser to Loopfuse.

There were a slew of new open-source companies launched (or still getting first looks) at last week's Open Source Business Conference. A few sites (Socialized Software and ZDNet, to name two of them)have been pointing to some of the more promising ones.

Here are a few to watch:

• Acquia - Drupal-based social/web content management company
• Ringside Networks - Social networking platform/application server
• Loopfuse - Marketing automation (Disclosure: I'm an advisor to Loopfuse)
• Projity - Microsoft Project competitor

And more. Check out the sites above to see who else caught the eye. Interestingly, JBoss executives sit on the management teams of several of them. As the market grows, there will be more cross-breeding between commercial open-source projects. This is a Very Good Thing.

It will be a few years, but I can't wait until Zimbra and MySQL have loosed their golden handcuffs so that they can start new companies, too. That's how the open-source business market will be enriched and grow.

I'm biased on this one, but I had to laugh when I read the Loopfuse blog today. It turns out that Eloqua, Loopfuse's most direct, proprietary competition, is totally unconcerned by Loopfuse as a competitor.

The problem, unfortunately, is that the data says otherwise:

I'm not sure why we continue to persist in talking about downloads, but I'm with Stephe on this one: downloads are not the best measure of success in open source. In fact, they're often not even a remote predictor of success (i.e., sales). Having them, as Stephen O' Grady notes, is much better than not having them, but it would be erroneous in the extreme to assume a company with 100,000 downloads per month necessarily has a bigger market opportunity than a company with 20,000 downloads per month.

The 451 Group's Matt Aslett points out that marketing automation software like Loopfuse can help to supercharge an open-source company's conversion rate. Same number of leads in, many more conversions (sales) out. I agree with that. Aslett writes:

Of course, the statistic [in Loopfuse's results] that will have jumped out for many people is the drop from a 40X increase in qualified leads to an 8X increase in engagements. The theory that leads are not enough in open source software has also been well documented. The ability to turn those qualified leads into paying customers remains a missing piece of the commercial open source puzzle.

Loopfuse has been actively selling to customers and blogging about its successes for nearly a year now. Yet such is the industry - where open source has become so mainstream that we often neglect the rise of truly innovative software - that it's not surprising that IDG missed Loopfuse until now. We forgive you, IDG! :-)

Regardless, if you haven't heard of Loopfuse or started using its (or a competitor's) marketing automation software, you need to correct this fault. Immediately. Here's what it does:

Lead generation products track the activities of potential customers on a company's Web site and use factors like their job titles and activities on the site to assign "lead scores," which help salespeople to target their efforts. The products work in tandem with customer relationship management software.

This is, in part, what open-source Loopfuse (as well as proprietary products like Eloqua) does. It's more than this, though this would be enough.

Talk with John Roberts, CEO of SugarCRM, and he'll tell you that his website is one of his most valuable business tools. It's often the beginning point to a customer relationship and is also often the source of a deal closing. Few understand web strategy as well as SugarCRM.

(Credit: JBoss/Red Hat)

JBoss might well be among that few. I was reading through an internal presentation from JBoss and continually find myself impressed by how well Marc, Rob, Bob, and the others grok'd the importance of the web to their business. JBoss knew who was hitting its website, what they were doing there, and how to nurture that initial interest into a sale.

Take a look at the slide to the right. IBM is the master of selling to the CIO and pushing its technology down into an enterprise. Open source generally works in the opposite fashion. You start with the developer/architect and "bottom-up" adoption of technology until it's pervasive enough to catch the CIO's attention...and her wallet.

There are many reasons to pine for the days of being a large, established software vendor. And then there is the fun of disrupting the ground out from beneath the feet of such vendors. It's great to have nothing to lose, and everything to gain.

That was my thought when Roy Russo of Loopfuse (open source marketing and sales automation) sent me an update on its pricing/product plans. Some of the policies Loopfuse is rolling out will need to be amended as the company grows (like the lack of a contract to engage services). So, will Loopfuse become the kind of company that someone else will one day enjoy disrupting?

Still, in the meantime, wouldn't you enjoy poking the competition in the eye with these?

Loopfuse and CentricCRM announced today a partnership that brings tight integration of Loopfuse's demand-generation software into CentricCRM's Customer Relationship Management suite. I'm a big believer in what Loopfuse is doing, as I've written. This is a logical next step for Loopfuse as it seeks to broaden the reach of data-driven marketing for companies that do business online (which is pretty much everyone).

I like the combination:

I had a call with venture capitalist friend yesterday to talk about Eloqua, Loopfuse, and other demand-generation software. Not being nearly as shortsighted as I am, he didn't want to talk about how open-source companies could benefit from such software, but instead wanted to talk about how non-tech companies could.

It's not the first time I've been struck by my own ignorance, but I really wasn't expecting to have to wallow in it yesterday. :-)

I was then surprised to see a similar perspective in this interview with the founders of Loopfuse: