SugarCRM’s recent launch of Sugar 6 CRM raised the thorny “but is it open source” question yet again. The question puts too much weight on the accessibility of the product’s source code or whether the product has a large enough user community. Current and prospective SugarCRM customers would do well to heed the lessons from the current predicament OpenSolaris users find themselves in and make the product selection based on your business needs, and not aspects such as access to the source code and size of the user community.

Open source, open core or proprietary?
SugarCRM offers a free AGPLv3 licensed Sugar Community Edition and commercially licensed Sugar Professional and Sugar Enterprise editions. All three editions provide the user with the product’s source code. Paying customers with access to the Professional or Enterprise edition source code, are able to modify the code, but are not allowed to redistribute the source code as per term 3 of the commercial license.

SugarCRM officials noted that, like many other open source product, SugarCRM customers, while having access to the source code, virtually never make code modifications.

Not surprisingly, functional differences between the Community, Professional and Enterprise editions of Sugar 6 CRM exist. These differences, specifically the new user interface, which is only available to paying customers, has drawn attention from pundits and commenters.

SugarCRM’s Martin Schneider described SugarCRM’s open source positioning as follows:

“Open source doesn’t mean free and was never really meant to mean free. Open source runs through everything we do, it enables us to be transparent and gives customers more power.”<!–

But a key element of the open source definition is the right to distribute the licensed code, which is clearly restricted under the SugarCRM commercial license. Some open core products make the commercially licensed product’s source code available to paying customers. Had Schneider said something to the effect: “SugarCRM is an open source company; Sugar Community Edition is an open source product while Professional and Enterprise are open core products”, the debate as to SugarCRM’s open source credibility would not be such a hot topic.

User community or paying customers?
The other key issue is whether the new user interface, a fairly critical aspect of the product, can benefit from community input if it’s not available to free user community. Dana Blankenhorn writes:

Who will enhance this new interface? Who is going to test it, and nurture it, and grow it? Sugar’s answer is Sugar and its paying customers… What commercial customers pay for is, in part, the community they become honored members of. When a key part of a product is no longer accessible to the community, its value is reduced to paying customers.

I frankly believe Dana is putting too much value into the user community. This is not to say that the user community doesn’t matter. It does, especially for early stage open source projects. However, with SugarCRM’s large paying customer base, with upwards of 5,000 organizations, collecting user input regarding the new user interface, or any other feature, will be simple enough without the need to expose the function to the much larger free user community.

In many respects, SugarCRM’s “Go Pro” marketing campaign, an effort to convince users to become paying customers, is the best form of security for paying users. Namely, knowing that SugarCRM’s revenues continue to grow at a level that allows SugarCRM to invest in future product enhancements and remain a strong and viable vendor. No amount of free users can provide this form of security for a paying customer.

Learning from OpenSolaris:
Let’s switch gears to the OpenSolaris community for a minute. I covered their state of limbo, awaiting Oracle’s direction, in mid April 2010. Little has changed in the subsequent three months – prompting the OpenSolaris Governing Board (OGB) to propose disbanding the OGB if Oracle does not engage with the community by August 23. Some community members are already talking about whether they would be able to fork the OpenSolaris code base and found a new community outside of Oracle’s control. However, they are coming to the same conclusion that others came to in April, that, while OpenSolaris has a user community, it does not have the depth of developer skills to sheppard an operating system project forward. At least not enough to compete with the likes of Linux or Oracle’s Solaris developers.

This is an important reminder for SugarCRM users, customers and potential customers. As large and vibrant as the SugarCRM user community is, even with access to the product’s source code, expecting that another vendor will form out of the community to provide a better customer-to-vendor experience than SugarCRM does itself, is a big assumption – one which should not be part of a product selection decision. Keep in mind that vtiger has already forked the SugarCRM code, and yet, has not been able to provide a sufficiently strong value proposition to a large enough percentage of existing or potential SugarCRM customers.

I’ve said it before, but it’s worth repeating:

The best advice, however, may be to simply ignore — or at least put much less weight in — the availability of source code when making a product selection. More often that not, you will have too much at stake elsewhere to take on maintaining a forked source code should difficulties arise.

Follow me on Twitter at SavioRodrigues. I should state: “The postings on this site are my own and don’t necessarily represent IBM’s positions, strategies, or opinions.”