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January 22, 2008 1:33 PM PST

Open-source funding day: Greenplum, Alfresco, Zenoss

by Stephen Shankland
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The venture investments flowed to open-source start-ups today, with new money arriving at Greenplum, Alfresco, and Zenoss.

The biggest chunk, $27 million, went to Greenplum, which develops business intelligence software based on the open-source Bizgres software project; the company's product is designed to help customers sift through data for useful trends. New investors Meritech Capital, Sun Microsystems, and SAP Ventures made the third-round investment, which also drew some from earlier investors.

Greenplum also said it's hired Paul Salazar as vice president of corporate marketing and Joe Otto as vice president of worldwide sales.

Bizgres runs on a single server, but Greenplum also develops a proprietary cousin called Bizgres MPP that runs on multiple machines simultaneously. Other companies involved in Bizgres development include JasperSoft, Kinetic Networks, and Loyalty Matrix.

Zenoss, which sells open-source software for managing computers and networks, announced $11 million in funding, its second round. Grotech Capital led the round, which also brought money from existing investors and several individuals: Frank Bonsal, founder of New Enterprise Associates; Andre Boisvert, chairman of Compiere and Pentaho; Mark Tolliver, chief executive of Palamida, Marty Frederickson, a former Sun Microsystems and IBM Tivoli executive, and Michele Perry, chief management officer of Sourcefire.

Alfresco, whose open-source software is used to keep a handle on the large quantities of documents companies must reckon with, announced $9 million in third-round funding. SAP led the round, and existing investors Accel Partners and Mayfield Fund joined.

Among Alfresco's customers are H&R Block, KLM, Electronic Arts, and "five of the top ten investment banks," according to the company. (Disclosure: Alfresco's vice president of business development, Matt Asay, writes a blog for CNET.)

That SAP is investing in both Alfresco and Greenplum is notable given that its own business software is proprietary and that SAP's executive vice president of marketing has disparaged open-source software for big businesses.

September 18, 2007 9:09 AM PDT

Microsoft resumes bashing open source

by Stephen Shankland
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Them's fightin' words!

That was my reaction when later last night I got the official Microsoft comment on my story about the Mozilla Foundation pumping new energy and funding into development of the Thunderbird e-mail software.

I'd asked about whether Microsoft was worried about competition from the project, given that Firefox has fared relatively well against Internet Explorer, and whether Microsoft would help Thunderbird programmers get their software working with Microsoft's Exchange e-mail server software.

What I got from Clint Patterson, public relations director for Microsoft's Unified Communications Group, went a couple notches beyond the "competition is healthy" category of platitudes I'd expected. Instead Patterson offered a broad criticism of open-source businesses that hark back to days of yore when top executives called the collaborative programming philosophy "un-American" and a "cancer."

"The open-source development model has yet to demonstrate the ability to support profitable software businesses that can drive the coordinated research and testing necessary to sustain innovation," Patterson said. "Many in the open-source software community have shifted to hybrid business models. They are making the same business decisions as any commercial software company in terms of what products and services to give away, what intellectual property to protect, how to generate revenue, and how to participate in the community."

It's true that there's a spectrum between fully open and fully proprietary; Microsoft deems it judicious to offer a few open-source projects, while companies at the other end such as Red Hat try to be as purely open-source as possible. Some are in the middle: Adobe has made some significant open-source moves, as with its Flex tool for Flash animation creation, while keeping its cash-cow Creative Suite firmly proprietary. Sun Microsystems, meanwhile, is in the process of moving its entire software suite into the open-source realm, with major portions such as Solaris and Java already moved.

But Matt Asay, vice president of business development at open-source document management company Alfresco (disclosure: Asay also is a blogger for CNET Networks), sees things differently from Patterson.

"The open-source community has actually been shifting away from hybrid models," he said, pointing to Alfresco, Funambol and MuleSource as examples. "Hybrid was yesterday's model, when people were still trying to get comfortable with the shift. Tomorrow's is 100 percent open, with 'proprietary services' on top."

Those services, Asay predicted, could be either for support, as in Red Hat's case, or as in Internet-hosed services--the kind of thing Yahoo is getting more serious about with its $350 million acquisition of open-source e-mail software maker Zimbra.

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About Underexposed

This blog sheds light on digital photography subjects such as cameras, photo editing, and Web sites. Shankland joined CNET News in 1998 after a five-year stint as a science writer. He's a lab rat who grew up in Los Alamos, N.M., and graduated from Harvard.

Contact Stephen at Stephen.Shankland@cnet.com

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