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Yes, you're thinking - why should we convince anyone to go opensource, its the better, cheaper alternative, and all savvy entrepreneurs would use it. But the landscape (here, anyway) is a little different.

Scenario: entrepreneurs are given grant money, to develop their product within a span of 12-months. Part of this package also includes Microsoft's BizSpark - 3 years free licenses for all needs, and you only pay on the 4th year (assuming you survive). They don't force BizSpark down anyone though - its just an option that is available. Its clearly easier to get Microsoft-trained developers - the market is gleaming with people that know .NET.

To the entrepreneur, go-to-market faster, can definitely be useful. Say, "use Rails, and you can have a prototype out in a few months", and it should make their eyes go wide open. But hiring good Rails talent can be more difficult (esp. with the tiny amount of grant money).

But the old adage that TCO is lower, or use it because its free, doesn't hold any longer. Entrepreneurs goal: go-to-market fast, survive, make money, profit!

So, how would you convince the entrepreneur to choose opensource, considering she's got all this weighing in on her?

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If I understand the question, which is to persuade an entrepreneur to use open source rather than release her own product as open source, the answer is simple: I wouldn't try. If you're trying to persuade someone in the abstract it's probably driven more by one's beliefs than their needs, which is problematic.

That said, here are a few factors I would encourage entrepreneurs to consider when it comes to evaluating the role of open source:

  • Choice: in your given market, what are the options available to you? In many software categories, there are free and open source software options available that are highly credible, freely available and backed by commercial options and a sizable community of knowledgeable resources. Free software may also give you a wider choice of available hardware.
  • Costs: there are numerous programs from commercial vendors that incent usage by trading initial costs for a commitment to use the product. These may well be in an entrepreneur's best interests, but then again they may not. When making the choice, it's necessary to understand fully the solution costs both now and at the expiration of incentive programs.
  • Interoperability: one of the things that commercial vendors tend to stress is the integrated nature of their offerings; i.e. that the solutions you buy from them will tend to work well together. While this tends to be true, it has been at times as much about locking users in to vendor solutions as it has been ensuring an integrated experience. When considering commercial software versus free software, then, it's useful to be aware of the tendency of the former to use a lack of interoperability as a mechanism to prevent choice.
  • Quality: while it would be absurd to argue that all or even most software is open source, it is accurate to state that in certain markets the most popular product or products will be free and open source software. Apache, for example, remains the most popular web server on the planet, and more recently the NoSQL (or more properly, non-relational database) market is dominated by free and open source solutions.
  • Resources: I've argued in the past that the Biggest Community Wins. And community is, typically, one of the things that open source does exceptionally well. Witness the size and scope of communities like Eclipse, Firefox, WordPress, and so on. Open source is at the heart of these communities success and size, so while commercial software and community size are certainly not mutually exclusive - the largest communities today tend to be driven by open source.

Ultimately, however, entrepreneurs should pick the solutions that best fit their short and long term needs. Picking purely commercial or free and open source software on an ideological basis is understandable, but is suboptimal as a selection algorithm.

There are many tools available - both FOSS and not - and all have strengths and weaknesses. Understand what these are, and pick the best tool for the job.

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Great points. One thing I would add is that if this is going to be hosted either on a VPS, dedicated, or by a 'cloud' offering I think we see today and will continue to see pricing advantage by being on open platforms. Take a look at Amazon EC2 pricing - aws.amazon.com/ec2/#pricing - Linux/Unix is the clear winner - in some cases by 30% or more. That will not be chump change when calculating TCO and there is essentially no way for MS to close that gap unless they give away licenses. – ctirpak Dec 11 at 0:07

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