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Open-Xchange aims for U.S. expansion

Open-Xchange plans to expand from Europe to the United States--and move many operations too. Also, more components are becoming open-source software.

Open-Xchange is using Yahoo's acquisition of rival Zimbra last year as an invitation to tackle the U.S. market with its open-source server software for e-mail, calendars, and other collaboration tools.

"Now is the time. The vacuum has been created, and we feel the suction," said Rafael Laguna de la Vera, who took over as chief executive in January. "Yahoo is not a software company...Now, with Microsoft (trying to acquire Yahoo), I think it's over for Zimbra."

Those are bold words for a CEO of an unprofitable company with 2007 revenue of $2.5 million that has struggled for years to penetrate the crowded "collaboration" software market. But Laguna also shared other plans to elevate Open-Xchange's profile:

• On Thursday, Open-Xchange plans to announce a broader release of its software as open-source under the General Public License (GPL). Coming will be installation and administration tools that previously were proprietary.

• Two other non-open-source components, a connector that lets Microsoft Outlook connect to an Open-Xchange server and the Ajax-based user interface for the Web-based access to the server product, will eventually become open-source, too, within a year or two, Laguna said.

• The company plans to join the Eclipse Foundation during the first half of 2008 to take advantage of the OSGI (which formerly stood for Open Services Gateway Initiative) tools to integrate software components. "We will be dual-license the server code under the Eclipse Public License," Laguna said.

• Laguna plans to hire U.S. programmers and other staff to augment the company's current staff of 40. "Marketing, management, global sales, user interface usability--all will be here," he said.

• Open-Xchange might raise a new round of funding to hasten these expansion efforts.

• The company's current main sales approach is to sign partnerships with Internet hosting companies that can offer the software as an add-on subscription service to those registering Internet domains. Its biggest partner to date, 1&1 Internet, plans to extend its partnership to the United States within the first half of 2008, Laguna said.

The company, originally called Netline Internet Service and based in Olpe, Germany, made its way to market chiefly through a partnership with Suse Linux. It's been trying for years to stand on its own, in particular after Suse was acquired by Novell, whose GroupWise product competes.

Because of the strength of open-source rival Zimbra and its willingness to sell at low prices, though, Open-Xchange chose to concentrate its efforts in Europe, Laguna said. "You pick your battles," he said.

The overseas ambition resembles those made by Suse, where Laguna worked until its acquisition by Novell. Suse wasn't terribly successful, but Laguna thinks things will be different: Suse was thwarted by Red Hat in the Linux market, but Laguna believes Open-Xchange now can take on Zimbra.

He's not the only Suse veteran at Open-Xchange with experience trying to perform this sort of conquest. Suse's former chief, Richard Seibt, is on Open-Xchange's board, and its chief technology officer is Juergen Geck, who held that post at Suse.