Open Source Revitalized Enterprise Software, Says SugarCRM CEO

SugarCRM CEO Larry Augustin, in an Aug. 26 interview with eWEEK, suggested that "open source has revitalized the enterprise software space" and that the benefactors will be small to midsize businesses with a need for analytics platforms.

Considering that SugarCRM offers open-source applications for campaign and account management, opportunity tracking, sales forecasting, and customer support, this is perhaps not the most surprising statement for its CEO to make.

However, it does provide an interesting contrast at a time when other business intelligence and enterprise software vendors, such as Oracle, have been moving aggressively to consolidate and expand their proprietary offerings. On July 1, Oracle released Oracle Fusion Middleware 11g, with tools that allow the enterprise to collaborate and trade information more effectively.

With such movements from the proprietary software side of things, where does open source fit within this schema, at least according to Augustin?

"We’re seeing the emergence of mega-corporations that want to own pieces of the solution and the ecosystem," Augustin said. "But smaller players like VMware and EMC are also branching out beyond their core space. There are lots of opportunity for startups, and open source plays into this."

The rise in global connectivity represents another benefit for startups. "The Internet allows direct reach on a global basis for consumers and allows a company to access global resources," Augustin added. "It’s now easier to build a channel with open source." Contrast this to the end of the dot-com boom, when the prohibitive costs associated with enterprise software distribution prevented startups from participating in the market.

With a connectivity-fueled drop in the cost of distribution, startups have more of a chance to compete against massive companies, and the benefits of that have extended to smaller clients. More startups are moving into the business intelligence and enterprise software space, and more SMBs have been compelled to utilize the software platforms that were once the providence of massive enterprises. VARs (value-added resellers) can see a competitive advantage here in developing applications for existing platforms and distributing them to smaller shops with a need for modified software.

"There’s more movement of [enterprise software] to SMBs," said Augustin, who claims that international adoption of SugarCRM’s software, particularly in Europe, will constitute a majority share of the company’s business within the next one to two years. "The Internet enables SMBs to be reached globally." 

The increased robustness of SugarCRM’s features could position it as an open-source alternative to proprietary offerings by Salesforce.com, NetSuite or Oracle. Sugar Suite is offered on a subscription basis in Professional and Enterprise editions, with a subscription including the source code, 12 months of application updates, installation assistance and technical support.