Nick Carr writes a fantastic piece--"Openness is not enough"--which highlights how far Microsoft has gone in the cloud, and whether anyone cares about lock-in. The answer to the first question is "shockingly far," and the answer to the second question is "not yet."
Indeed, it's the second question that I find most interesting.
Carr first quotes former Google Gears developer (and current Mozilla employee) Dion Almaer...
For those of us who worry about handing Microsoft control of the browser, plugins to other browsers, the cloud, the server model, and more.... I won't lie to you. I am cautiously observing. Silverlight adoption worries me. We can't fight Microsoft with "don't choose them, remember what they did to you before?" Fear is lame. Instead, this is a wake-up call to Adobe, Google, Yahoo!, Amazon, IBM, Sun, [insert other developer / platform players] to get kicking.
We can't just be Open, we have to be better!
...and then follows up with:
[I]n this early stage of the cloud's development, openness means little to the buyer (or user)....What they care about right now is security, reliability, features, compatibility with their existing systems and applications, ease of adoption, stability of the vendor, and other practical concerns. In the long run, they may come to regret their lack of stress on openness, but in the here-and-now it's just not a major consideration. They want stuff that works and won't blow up in their faces.
The first consideration is, "Will it work?" The second is, "Will I work for it?" Put another way, "How can I make the software (and its vendor) work for me, rather than being locked into it?"
Now, it's absolutely true that openness is not necessarily the reason to buy, but rather can be the reason a prospect even knows you exist (e.g., they downloaded your product). But Carr is onto something here. Some grouse about the iPhone being proprietary, but even at open-source Red Hat I saw an increasing number of iPhone users. Why? Because it works, and it works well.
Openness, and open source as one face of it, can't be the leading virtue in new markets. Openness is the bailout plan for customers enmeshed in old markets, and is a critical component of a distribution strategy designed to find new customers rather than spending the cash to find them.
Regardless of the relative age of the market, the focus must be on product excellence. An excellent product that is coupled with an excellent distribution strategy (e.g., open source) should win more often than not.
Openness is not, as Carr writes, a get-out-of-competition-free card, and it's not likely to entice buyers in new markets. But as a component of a great product offering, even in new markets it should win.