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HolidayBuyer's Guide

Easing SaaS lock-in with open source

Open source offers SaaS vendors a way to ease customer concerns about data lock-in should the vendor go bankrupt.

Larry Dignan at ZDNet calls out a significant customer concern with SaaS: data lock-in, particularly if a SaaS vendor goes out of business. How can a SaaS customer get its data out of a failed SaaS system without undergoing the burden of escrow agreements?

The answer is simple, but perhaps not palatable to SaaS vendors: open source a version of their software.

SugarCRM does this, letting its customers run SugarCRM "in the cloud" but giving them the code via an open-source license so that they can support their own deployment if necessary. Why couldn't a or RightNow do the same?

Answer? They could, and wouldn't even need to open source their code today. Perhaps they could create a special escrow agreement that triggers open sourcing the code upon a winding down of operations? There are problems with this, of course, as it may diminish the value of the vendor's assets, but it's a relatively clean resolution to a customer concern, and one that is already being used in the industry.

Disclosure: I am an advisor to SugarCRM.