Open source systems for SaaS

Open source is increasingly being used along with commercially available proprietary solutions. This is because companies look at open source as a good IT investment and Linux has achieved significant success in the server operating system market. It is not a major threat as yet to Windows. Another segment where Linux is picking up steam is servers for running data centers which run hosted applications. The Apache web server has a very healthy market share that is in excess of twice that of Microsoft IIS.

SugarCRM, which is an open source CRM application, is making consistent inroads in the CRM market. Independent Software Vendors (ISVs) are witnessing a spurt in the demand for their services via the SaaS model. While on-premise models usually end up using Windows because the customers are familiar with the Windows platform, SaaS solutions administered over the Internet from the ISV’s premises usually use Linux. The reason for this is that while on-site installations may be limited in scale and are better supported on Windows, off-site installations that equip a data center support a large number of users and have to be open to unlimited scalability.

Enterprise servers or a large number of commodity servers are the best alternatives for a SaaS scenario. Enterprise servers are increasingly turning to Linux architectures; for example the IBM System i and the IBM System p5. Linux also provides greater economies of scale as compared to Windows when the commodity servers are placed in a grid. Other open source products are also being used by SaaS vendors. RightNow Technoliges has installed the largest MySQL database, which uses Dell computers running on Linux. Salesforce.com too uses Linux for running its Oracle database. Microsoft on its part is trying hard to counter the open source threat; it is teaming up with third parties like 7 Global for making it convenient for ISVs so that they can make SaaS available through Microsoft.