The Advantages of SaaS in an Open Source Model

I had a phone call today with a SugarCRM customer who has deployed Sugar On-Demand in a big way. About halfway through the discussion, the chitchat sidetracked into a discussion about the advantages of linking open source with software-as-a-service (SaaS). The IT manager I was speaking with made a great point about the advantages of open source, SaaS, and hosting partners. It got me thinking, and motivated me to write this blog.

Traditionally, commercial open source (OS) providers grab what they can get from an OS community, tweak it, add to it their core solution, and then wrap it into a business model that can be profitable for both them and their customers. So why not extend the advantages of open source freedom to SaaS and hosting partners?

These partners all have open source already running in their data centers. They love OS and work with it everyday. It gives OS providers an edge over their proprietary brethren and unlimited scalability to customers if the application is built for scalability and multi-tenancy, which is exactly what SugarCRM has done with its own on-demand product offering. With the applications running on open source stacks, such as LAMP, it provides a nice fit into the infrastructures of the partners, giving them the additional services to add to their product mix.


One thought on “The Advantages of SaaS in an Open Source Model

  1. Completely agree.

    There are enormous benefits of combing open source and SaaS. It is only through this route that it is possible to create a competitive utility market with an ecosystem of providers and portability between those service providers. This is important because such a marketplace can overcome the adoption fears of SaaS (lock-in, reliability etc).

    The growth of SaaS should be accelerated by open source and providers working together on the principle that a small piece of a big pie is way better than a big piece of a small one.

    I talked about this at OSCON ’07 (video of my presentation is at and at various blog posts over the years (see

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