Take the $2.5 billion market for expensive content-management systems. Although most large businesses will choose from among EMC, IBM, Oracle, or SAP for such software, many smaller businesses would rather create their own file-sharing systems or simply do without, says John Newton, co-founder of Documentum, a content-management company bought in 2003 by EMC. Seizing this market opportunity, Newton on Monday will launch Alfresco Software Inc., his latest business endeavor and his first in the open-source arena.
Alfresco will leverage open-source principles to deliver content-management technology to places where it had been too expensive to use. The new software is designed to offer the ease of use found in shared-file systems along with the security, version control, metadata and full-text search, and workflow features found in more expensive packages, says Newton, who serves as the company's chairman and chief technology officer. "With our system, all you have to do is drag and drop the content," he adds.
Alfresco launches with the financial backing of Newton, co-founder John Powell, and a $2 million seed round of venture-capital funding from Accel Partners. Powell, who served as chief operating officer for Business Objects SA, is Alfresco's president and CEO. Newton and Powell first began working together in 2002 when they launched Activiti, a company that offered distribution technology for financial-services and investment-management companies.
Alfresco is licensing its software under the Lesser General Public License and making it available through its Web site, www.alfresco.org. The company also plans to offer its software through a number of open-source code repositories, including Sourceforge.net.
Alfresco won't be alone as a provider of open-source content-management software. In fact, the high cost and complexity of enterprise content-management systems has inspired the creation of several open-source projects. A recent report by Cutter Consortium profiled nine such projects, created by Collective Intelligence, eFoundry, Enomaly, Kineticode, Metadot, Miro International, Plain Black, Wyona, and Zope.
Newton acknowledges there are dozens of open-source content-management projects available on the Web, but he says most focus more specifically on document management or Web-content management. Alfresco offers both, plus the backing of programmers with more than a decade of experience developing enterprise-class software, he adds.
Alfresco also hopes its approach to development will spark some interest within the all-important open-source developer community. The company built the core content-management software using an "aspect-oriented" approach to programming, Newton says. The goal of this approach is to represent each of the program's capabilities clearly in the source code. Conceived by Xerox's Palo Alto Research Center, the aspect-oriented approach is designed to allow each design concept to map directly to an implementation construct. The ability to define rules for different "aspects" of a program is, in part, what allows Alfresco to offer users the ability to drag and drop data from one database to another, he says, adding, "Aspect-oriented programming is a technology innovation, just as open source is a business innovation."
Of the $2.5 billion market for content management, more than half is spent on services, Newton says. This is what makes content management such a strong opportunity for a company employing an open-source model, which relies heavily on revenue from services, as opposed to software licenses. Open source is also a great way to get a new product out to the market because users don't have to pay anything to simply kick the tires, he adds.
Introducing software into the open-source community gets that software used in places it's not being used today, Newton says, adding, "The barriers for implementing are minimal."
Proprietary vendors don't interface with their customers the way the open-source community keeps tabs on the needs of its users, Newton says. "In the open-source environment, it becomes more of a dialogue between the person who developed the system and the person using the system."
Alfresco's strategy is similar to that of JBoss Inc. and MySQL AB, providing technology and selling services to the developer community with the hope that those developers will eventually help create products that rival the market leaders. "Right now, JBoss and MySQL are not hurting the biggest players in their markets," Newton says. "They're hurting the smaller players and driving market consolidation."
Can open-source applications seriously challenge entrenched veterans such as IBM or Oracle? "One only has to look at Linux to see the possibilities," Newton says. "Linux is close to being 'game over' for Unix."