Small and midsize companies are creating IT infrastructures based on open-source software to reduce licensing fees and increase flexibility
It takes a lot of horsepower to create the 3-D virtual world known as Second Life, where users can build digital avatars to their likenesses, participate in a virtual economy that lets them purchase real estate and construct buildings, and fly through pixelated blue skies over a 100-square-kilometer computer-generated campus. In the past, the sticker shock of buying and managing the 1,400 CPUs and associated software needed to power this rapidly expanding massive multiplayer online game would have been enough to curb the enthusiasm of even the best-funded startup.
So it's not surprising that creator Linden Lab has turned to open-source software to power the IT engine that keeps Second Life alive. The sheer amount of processing power--the number of CPUs grows as much as 10% monthly--made Linux the obvious choice to run Linden Lab's servers. The company also chose to store the avatars that its nearly 60,000 users have created in a file system front-ended by the open-source Apache Web server, while the open-source Squid Web proxy cache keeps the data conveniently nearby. Metadata about the avatars is stored in an open-source MySQL database.
Linden Lab, a privately held company with 31 employees that's a subsidiary of Linden Research Inc., and other small, growing companies are the perfect candidates to pioneer the use of open source. Such companies have fresh ideas that they're anxious to introduce to the marketplace. To do this, they need plenty of IT infrastructure, so they build farms of x86-based servers running Linux, proliferate MySQL databases, and write their software to work with open-source application servers like JBoss.
Open source is most valuable to small and midsize companies as a way for them to cut IT costs, according to a September study conducted by InformationWeek Research and open-source service provider Optaros Inc. The study, which surveyed 296 open-source users with less than $1 billion in annual revenue, found that 81% look to open-source software to reduce the cost of using commercial packaged software. More than half of the companies surveyed cite the need to reduce their dependence on commercial software as a motive for adopting open-source software, while 41% cited the potential to reduce hardware costs. Nearly three-quarters of the open-source users surveyed are small businesses with less than $50 million in annual revenue.
The key to launching Second Life in 2003 was using quality software that didn't require shelling out a lot of money for licensing fees. "The need to pay licensing fees might have prevented the growth of Linden and Second Life," says Cory Ondrejka, Linden Lab's VP of product development.
Linden Lab founder Philip Rosedale, the former chief technology officer of RealNetworks Inc., and his team knew they were launching an online endeavor in a post-bubble environment. "We had all seen the writing on the wall in 2000 that we weren't going to be able to raise a lot of VC money," Ondrejka says. The company did raise $8 million in venture-capital funding, primarily from Benchmark Capital, a year ago. "Still, we went from zero to 500 machines before we had a system admin for them, so the idea of building out a sustainable structure was a priority."
When Scott Johnson got the idea a few years ago to create Feedster Inc., a blog aggregation site that delivers XML-based content, he executed on that idea using open source. Johnson wrote Feedster's initial Web spider and search engine using the open-source PHP development tool. "I took a list of about 300 RSS feeds and wrote a very primitive spider and a very primitive search engine," he says. "Would that have happened if I had to buy a database license? I don't think so." Feedster, which lets Web users search blogs for specific information, monitors more than 15 million feeds.
The Growth Factor
Feedster, a privately held company with 20 employees, updates its feeds several times per hour, adding millions of new documents daily. To keep up with these demands on the back end, the company has grown from 45 Linux servers at the beginning of the year to 75. Of those, 60 are Web servers that pump out its RSS feeds and run on Gentoo Linux, while the rest are database servers running SuSE or Red Hat Linux.
Feedster illustrates another characteristic about the use of open source within startups. The company, which launched without any legacy IT, uses open source at its core, relying on phpAdsNew, an advertising server that's written and supported by the open-source community. It pulls advertisements from the company's database and runs them in the search results that Feedster produces. Startups that emerge from larger or failed companies, as well as successful ongoing businesses, often find their use of open-source software limited by pre-existing investments in legacy IT systems.
Yellow Online depends on the open-source community for support information, says Dariush Zomorrodi, Yellow Online's VP of corporate development and technology.
Photo by Peter Tym
Not all emerging companies have the luxury of building their business on open source from the ground up. Yellow Online Inc., an online directory service that provides listings for 1.2 million Canadian businesses and 12 million residents, moved its business fully to the Web in 1999 when it was launched as Yellow.ca. The company was actually founded in 1974 as Tele-Pages Inc., a provider of paper-based business listings. As a result, Yellow Online has 50 Gbytes of billing, customer-relationship-management, and human-resources data sitting in an Oracle database server running on Sun Solaris. Still, says Dariush Zomorrodi, the company's VP of corporate development and technology, open source is the best way to accommodate new online growth. "Expansion on Sun and Oracle wasn't something we could afford," he adds.
Feedster is different in another way: It bought a support contract with MySQL AB for its open-source database, a move that many small, tech-savvy businesses aren't willing to make. The InformationWeek Research and Optaros study found that only 8% of small and midsize open-source users are likely to use packaged open-source products that include a support contract.
"Whenever you push the outer limits of any system, you're going to have problems," Johnson says. Because the database is a core part of Feedster's business, Johnson says a service contract is cheap insurance, although he won't disclose what he's paying for the contract.
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