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Even The Enterprise
Jan 20, 2009
It's Channel Time For Linux - Open-source app developers look to partners to help take Linux mainstream
The open-source channel offensive is even taking hold in the most robust enterprise application segments of the market such as ERP and business intelligence. Nearly all of open-source business intelligence vendor JasperSoft's sales were direct last year. But with the formal launch of its JasperSoft partner program late last year, the company aims to receive as much as 20 percent of its sales from channel partners this year, said Don Wight, vice president of worldwide field operations at JasperSoft, San Francisco. That means doubling its partner base this year.
Wight estimates that in the typical business intelligence solution sale the software license accounts for as much as 50 percent of the solution sale, while in the JasperSoft open-source model, only about 20 percent is related to software licensing. That leaves a whopping 80 percent of the IT budget for high-margin consulting, Wight said.
Ron Bongo, CEO of Corratech, an open-source solution provider in Montclair, N.J., said his company just completed a deal where the cost of the software license from a traditional business intelligence vendor came in at more than $100,000 compared with $20,000 for JasperSoft. "What can you do with $80,000 if you reallocate that to gain a strategic advantage?" he asked. "You can integrate more, customize more and build that into the overall project." Corratech even uses software calculators to drive home the dramatic cost differentials. For example, the company's CRM calculator asks users to input the number of users and estimated integration hours. The calculator compares a Centric CRM solution coming in at hundreds of thousands of dollars less than proprietary offerings.
Bongo said he sees the new formal partner programs helping to drive significant growth this year for Corratech, a former Microsoft (NSDQ:MSFT) .Net partner that moved into the Linux open-source business in 2003 after seeing the significant gains that could be produced for clients using open-source software.
"We just saw great software being produced that we could use to deliver e-commerce solutions much more easily than building them from scratch," he said.
This year, Bongo expects to double sales from 2006, when sales were up 40 percent. "Open-source vendors are adding significant resources, helping the channel produce more results," he said. "A lot of [open-source] vendors have formal partner programs and are even completely dedicated to the partner strategy. The current acceptance of open source and the commitment by vendors to work side by side with us and avoid the channel conflict that can occur with proprietary vendors is going to have a huge impact on our ability to generate revenue."
