Wednesday, September 30, 2009

Sacrifice holy cows during crisis

During this crisis, boards of directors are willing to sacrifice holy cows if it improves their bottom line. The IT departments often have become bulwarks of religiousness around IT platforms: Microsoft, Sun Unix, IBM, Linux, SAP, Oracle. When a philosophy has settled in the brains of IT staff, it takes more than electroshock therapy to blank this out.

From a business model point of view, there are only advantages to choose for an open source strategy, given that the quality of the software is good:
- no customer lock in
- no license fees
- easy access to sources
- abundancy of IT resources

And the objections can be easily accommodated
- guarantees & support can be organized or is already provided by specialized business
- choose the best open source only with the larger user base and a vivid community

More and more startups understand, nowadays, the business potential of building a best-in-class open source solution. One of the great examples was MySQL, now owned by Oracle. Business angels jump on the bandwagon of this new goldrush. And the nice thing is, less than 1% of the IT startups understand the potential, and it will take years before they will. "To give everything away" is somehow difficult to harmonize in the mind of the modal business man with "making money". The opposite is true. And that's why Magentocommerce made its moves and is growing fast. And ICEshop spent two years and 10s of man years in development, to develop an open source Trader Shop (Batavi).

What are the (expected) effects?
1) 100s of downloads in the first days. Batavi aims for 500K downloads in its first year
2) more & larger client projects
3) growing popularity of the brand and website, which already passed iceshop.nl in Alexa after a few days (not a big deal though). Batavi aims for a top 2000 Alexa ranking position similar to magentocommerce
4) market sympathy and easy to partner with because of the open model

Time will learn if the ambitions are realized. But given the Open ICEcat experiences, there is no single doubt on my mind given the quality of the software development team, the 10 year ecommerce history of iceshop, and the client interest.