The following post doesn’t really fit in line with the normal spirit of the blog, simply because it’s not funny nor directly related to technology. It’s called Business 2.0, as it relates to the ever problematic question any business owner has: “When should I grow and how?”.

As you may know, I’ve been a freelance Asterisk Platform developer since early 2003, turned to freelance development (Penguin for hire) around April 2007. Since that time, I’ve built systems and platforms for some of the better known brands around the world. Be it working directly with the customer or through a 3rd party (as a sub contractor) – I can easily say that I’ve completed over 120 different large scale projects within 3 years time. Now, when I refer to projects, I’m not referring to installing PBX systems, I don’t do that at all – I’m referring to highly complex application level development, creating some of the most innovative Asterisk based systems I’ve ever seen.

Image via CrunchBase

Image via Wikipedia

Putting aside everything, finalizing a rough estimate of 40 development projects on a yearly base, most of these performed solely by myself is a fairly challenging task. Sure, at times I’ll outsource some work to other freelancers like myself, specifically in fields where I’m not all that fluent (Database, Web Development, UI) – but yet, doing that means that I’m conducting 3 – 5 projects on a monthly basis.

After doing so for 3 years now, I can’t help but start thinking about expanding my business, taking it to the next level by hiring more people and building it up to a new level. Question remains for this: “How? What is the natural track of expanding your business?” – of course the simple answer would be: “Just hire another developer or two, and start doing more sales” – it’s not as simple as it sounds. After thinking about it for some time, I’ve concluded there are a few models of expansion:

Model 1: Organic Growth

Organic growth can be described as the simplest way of growth: “Hire a new guy and get more work in”. The problem with this model that it is fully reliant on your ability to sell more. However, as you concentrate on sales more, you take time from the development and delivery process – thus, the addition of the new developer is not a 100% addition, it’s actually 100% (developer) minus 40% (you) – so you are not at 200% capacity, you are 160% capacity. Surely 160 is 100, however, for the initial 6 months, till the guy learns the ropes, you are not at 160, you are actually at 80 – can you and your business sustain that?

Thus, the main issue with Organic growth is cash flow, can your business sustain the elevated expenses with less income for the period of transition? If the answer is NO, then you need a different method. If the answer is YES, then you are in the best place in the world, however, bear in mind that taking someone to work for you is a responsibility – people are not resources, they are human beings, with families and children – taking someone to work for you is like taking responsibility for their lives.

Model 2: The Partner

A partnership with a person who is equally matched to you is always a good option. Technically speaking, it means that you are teaming with someone who generates as much work as you do and is capable of finalizing the work as fast and as good as you can. Yet, taking a partner doesn’t negate the requirement for a new employee or two. In this case, you may end up with too much sales with too little staff to deliver – that is a big problem.

Another issue with partners is the issue of trust. While most partners tend to rely on each other and trust each other, that trust can easily be broken (in most cases by stupid things). It’s enough for one partner to now carry its weight in sales/development to initiate a chain reaction, shortly ending in the partnership dissolving.

So, the partner is a good option, however, may prove to be problematic if the wrong partner is chosen – in addition, dissolving a partnership solely on these issues isn’t all that simple – and usually ends up in litigation and other judicial issues – YUCK!

Model 3: Un-intrusive Angel

Some people ragard Un-intrusive Angels as “Stupid Money” – an Angel investor that doesn’t interfere in your company business model and operations. In many cases, this is how start-up companies start – someone gives them a lump sum of money to start their business, signing off to own a portion of the new company.

An un-intrusive investor usually gives you the money and pays you a visit once every few months to see how his money is spent. Don’t expect to raise a whole lot from these people, usually you will get anything from 25K$ to around 250K$ – tops. If you are getting an investment from an Angel, make sure you plan your business carefully – and make sure your investor knows what he is getting into. The Angel is not a found piggy bank, he is a business man looking for profit – if you make sure his expectations of profits (time frame, amount, percentage, etc) are kept within the reason of your business – he will make an educated decision and invest accordingly. Promises like: “you’ll double your money in 3 years” are stupid – make sure it’s realistic and to the point. If you promise the moon, and reach a star – that’s a problem, if you promise the skies and hit a start – that’s wonderful.

Model 4: The Strategic-Intrusive Angel

Image by TheFemGeek via Flickr

A strategic angel is similar to the previous one in terms of funds, however, he is more capable in assisting your business meet its goals. Usually, it would be someone who is already a well established figure in your business sector, had made his money from previous companies and is now looking for new ideas and businesses. I call him an intrusive Angel, as sometimes he may have ideas as to where your business should go – and he will make sure you hear his ideas. You may regard it as annoying, but you should still listen to your Angel and pay him the respect he deserves.

Sometimes this Angel may invest in your business due to the fact that he has a hidden agenda. An agenda can be: The angel looks at your business and see a certain potential you are not planning, he’ll invest and try to re-direct your company to the agenda he sees. This is usually the case when your angel is invested into several endeavours that is either parallel to each other or may have orthogonal intersection points. These angels can be the builders of your business or the destroyers, it is up to you to make sure the latter doesn’t happen.

Prolog:

So, which model did I choose? – I didn’t choose yet, I’m still figuring it out myself. What ever the model may be, the choice isn’t simple nor straight forward. At best, whatever choice I’ll take will have a profound impact on my business and me – so I’ll need to weigh my options carefully. If you can think of an additional model, I’d love to hear about it – so just comment on this post.

Revenue sharing is one of the oldest methods of earning profits, actually, I believe it may just be right up there with trading of goods and food. For those of you not in the know, I’ll explain what revenue sharing is:

1. A content provider wishes to distribute a certain type of content – charging for it.
2. The content provider has not ability to charge the consumers directly, thus he partners with another party – the transport maintainer.
3. The transport maintainer charges the consumer, while keeping a certain percentage in his pocket.
4. Everybody’s is happy.

In general, this model works really well in many markets – specifically those that are driven by unique content – for example the mobile content market (ringtones, screen savers, games, apps) – the Apple App store is a wonderful example of how this works.

In the telecom industry, the revenue shares business is very common – however, in many cases it is highly guarded as a secret – main reason is that now one wants anybody else to know how they do it. This hiding of information, usually results in some problems – as when there is hiding of information, only those in the know are able to access it. Those in the know are called “mediators” or in Herbew “Machers”. In this entire ordeal, the mediator also takes a small percentage – leaving the content provider with slightly less. So, now it looks like this:

1. A content provider wishes to distribute a certain type of content – charging for it.
2. The content provider has not ability to charge the consumers directly, thus he contacts a mediator to find him a transport partner.
3. The mediator engages the prospective transport maintainer.
4. The transport maintainer charges the consumer, while keeping a certain percentage in his pocket and passing some funds to the mediator as well.
5. Everybody’s is happy.

So, if everybody’s so happy – why am I bitching about it? very simple – people are Greedy and always want more – putting the entire model into a frenzy. In order to give an example, let’s imagine the following scenario:

1. Company A provides IVR based content utilizing Asterisk server, connected to the internet.
2. The mediator engages a premium number company, getting the total revenue of 0.08$ for every inbound minute of traffic.
3. The premium number company leaves 0.01$ in its pocket and also pays the mediator a fee of 0.01$ per minute.
4. The content provider gets 0.06$ of the 0.08$ – 75% of the net profit goes to the content provider.
5. Content provider says: “Hell, I want the mediators 0.01$ as well, and I think the premium company should only get 0.005$, so I would get 0.075$ at the end”
6. Content provider contacts the premium provider and starts complaining
7. Premium provider negotiates and strikes a deal for 0.07 to the content provider, leaving the premium provider with 0.005$ and the mediator with 0.005$
8. Premium provider says: “I’m not making enough money on this, actually, I’m loosing money – I’ll find a better alternative service for that access number”
9. Premium provider asks mediator to bring in a new customer, providing similar content – mediator has sure incentive here
10. Premium provider gets new customer and transfers the access number to the new customer – returning back to previous profits
11. Original content provider is left with no profits and only greed in his hands

Over the past 10 years, I’ve seen this vicious cycle happen over and over and over again, in various formats and scenarios – but always ending in the same outcome – the content provider always suffers. If you’re a content provider and you provide IVR based services, let the people that provide you the access make their cut and the people in the middle, without them, you will have a service with no access – which means no service at all. Don’t go about thinking you can keep all the profits to yourself, you will break the equilibrium of this business, and eventually, no one will want to do business with you.

Image via Wikipedia

When I started using Open Source software, it seemed like all Open Source projects are driven by philanthropic agendas. We were all focused on “sticking it to the man” – showing all these would be software vendors that community driven projects can do just as well – if not better.

"When I was a child I spoke as a child I
understood as a child I thought as a child;
but when I became a man I put away childish
things." - I Cor. xiii. 11.

Well, I’m not claiming that Open Source is childish – absolutely not, however, when you are a student you tend to look at things in one way, when you have a family to care for – you start looking at things differently. You remember these days in life when your dad said: “When you’ll have children you will understand” – well, now I do.

So, what am I rambling about exactly? I’ll tell you. The day before Passover I attended several meetings, which when I came back home had pissed me off immensely. I feel an urge to write all about these meetings, including who I met exactly, however – I won’t do that. However, I will give a rough idea of these.

Meeting 1 : A world recognized Mobile application player

I came into the meeting with this company, where the CTO of the company explained to me that they are looking to create an Asterisk based solution for their application’s users. My initial question was: how many users? what is your concurrency level? – The answer that I got was: “Oh, we don’t need something major, just a few lines of configurations in Asterisk config files in order to make this work”.

I left the meeting slightly pissed off, thinking to myself: “You bloody inconsiderate prick! You bring me to a meeting, spend my time – and then telling me that this is just a few lines of configuration. If it is that simple, why don’t you do it yourself? you have 20 developers in there, 4 IT people and god knows how many outsourced workers off-shore – if it was that simple, you would have done it already – so probably it isn’t – right?”

Meeting 2 : A well established IVR services vendor

The second meeting was with a well established IVR content vendor, this company runs around 16M minutes of inbound IVR traffic every month. They invited me in order to talk about expanding into new countries, wishing to get premium based access numbers in various countries. So, we started talking, and the guy indicates that he wants a certain kick-back payout, which I know is impossible – at least without charging the user more. Actually, the guy indicated that out of the interconnect fee, he wants to get almost 90% as a kick back.

Meeting 3 : A start up rendering IVR content

The third meeting was the most amazing one – these guys wanted to build an Asterisk system to server around 4000 concurrent channels – outsource the entire development to my company – and pay as a revenue share. When I asked for their business model, marketing plan, investors, profiles – I got a response of – we don’t yet have all of these, we only have an idea at this point that we want to implement.

Garage based companies are built by people who can do the work themselves, not the other way around.

At this point, you are probably asking yourself: “What does this have to do with the title?” – Well, all of these meetings had one thing in common. The people I met were under the impression that Open Source is some form of philanthropy. Or to be more exact, people who deal with the Open Source market are philanthropists. My question is this: “Why are we perceived as philanthropists? don’t we have families to care for? don’t we need to pay mortgages and bills just like everybody else?”. I guess when people read about the various Open Source entrepreneurs, such as Mark Shuttleworth – the immediately associate Open Source with Big Exists – this is not the case.

At some level, this is purely our fault – we educated people that Open Source is a highly economical methodology of solving technical challenges. No where along the way, had we educated the public that behind the model there are people, people who need to make a living.

If you are an Open Source consultant, developer, evangelist or just someone who may have an opinion on this, I’d love to read what you say.

Over the years I’ve seen many scams running on the net. Ranging from the ever annoying chain mails to the ever popular Nigerian Sting – Internet fraud is all around us. Lately, I’ve been hit by a new type of fraud attack, a domain registration fraud attack – mainly located in China and Hong-Kong.

As you may know, I’m the owner and CEO of a company called GreenfieldTech, dealing with Asterisk and VoIP application and platform development. Now, we operate world wide and render services to some of the world biggest brand in the telecom industry. So, we take our copyright and brand very seriously, when we receive an indication that someone is or may be infringing our copyright or brand, we take a stand for it.

So, today I’ve received this email:

Dear CEO, 

We are a domain name registrar centre in HongKong,and in charge of the registeration in
Asia, We have something important need to confirm through your company. 

We received a formal application from a company called "Hempus International Holdings
Ltd" applying to register 

Internet keyword :     greenfieldtech 

Domain names :

 greenfieldtech.asia    
 greenfieldtech.cn    
 greenfieldtech.com.cn    
 greenfieldtech.hk    
 greenfieldtech.in    
 greenfieldtech.mobi    
 greenfieldtech.net.cn    
 greenfieldtech.tw

In China and also in Asia on January 21 2010. During our auditing procedure we find out
that the alleged "Hempus International Holdings Ltd" has no trade mark,Intellectual
property, nor patent even similar to that word. As authorized anti-cybersquatting
organization we hereby suspect the alleged "Hempus International Holdings Ltd" to be a 
domain grabber. Hence we need you confirmation for two things:

First of all, whether this alleged "Hempus International Holdings Ltd" is your business
partner or distributor in China.

Secondly, Whether do you need to protect the intellectual property right which should have
belonged to you?. (The alleged "Hempus International Holdings Ltd" will be entitled to obtain
a domain not needed by  original trademark owner.)
If you are not in charge of this please transfer this email to appropriate dept.in order to
deal with this issue better, please let someone who is  responsible for trademark or domain
name contact me as soon as possible.
_____________________________________________________________________________________________
 Confidentiality Notice: This is a letter for confirmation. If the mentioned third party is
 your business partner or distributor in China please DO NOT reply.  We will automatically
 confirm application from your business partner after this audit procedure.we have to notify
 you,and our registration organization are  not responsible for any dispute questions about
 trade mark,intellectual property nor patent after they succeed in registration.hope you can
 understand.thank you.
 ____________________________________________________________________________________________

Sincerely,
  kaka.xu

Sponsoring Registrar:sk holdings company ltd 
 Web:www.sk-dns.org/www.asia-gov.com
 Tel:00852-95660489 / 00852-95660103 
 Fax:00852-30696940

Email:kaka.xu@skdns.org/

Address: 3A, Units 20/F, Far East Consortium Bldg, 121 Des Voeux Road, Central, Hong Kong

kaka.xu

2010.01.21

So, this is obviously a scam, as when I searched the alleged company, I couldn’t find anything. However, the term “International Holdings Ltd.” had produced many scam alerts and related information popped up everywhere. Now, bear in mind that this is the 10th time them past 2 months that I’m receiving such emails. So, I’ve formulated the following response to them, and you are welcome to use it:

Dear Kaka,

Thank you for contacting us in regards to this matter, to be completely frank with you,
we’ve received over the past 2 months a similar request/demand from various Asian registrars
in China/Hong-Kong. Through our contacts in the far-east, we’ve concluded that your
request/demand is fraudulent, and that the company you indicated doesn’t even exist.
Please note that your approach to us claiming that someone wants to infringe our copyright
and brand had been noted and passed to our legal department. In addition, we’ve forwarded your
email and general company information to various SPAM, Abuse and Security teams that are in
contact with us around the world (mainly, [Mention your really BIG business partners and
large customers here - also through in some ISPs in the far-east, specifically China). Should
your company register ANY of the below mentioned domain names or keywords, following this email,
we shall be forced to follow legal actions in accordance to the laws of the state of [Put your
country here] and other countries where our company has representatives or local business
engaged partners.

P.S.

[Always add a personal note - and refer to something in the mail they sent, for example]

On a personal note, when sending emails to anyone in Israel, I would suggest that you choose a
different name, other than Kaka. Kaka in Hebrew is directly related to the bodily function of
purging waste – also known as taking a dump in the toilet.

I recently gave a presentation at the Amoocon convention, held in Rostock, Germany – about Asterisk and Amazon EC2. Below is a medium quality video of that presentation:

or you may download it here:
Amazon EC2 and Asterisk video files

Last night I met with a friend of mine, Mr. Doron Ofek. For those of you not familiar with the Open Source market in Israel, Doron is the one person most affiliated with RedHat in Israel, as Doron championed the adaptation of RedHat Linux servers in various enterprises and government offices in Israel. Doron is currently heavily involved in the OpenMoko project and its adaptation and promotion in Israel.

We spent a great deal of time last night, talking about the various aspects of Open Source training in Israel – as both us provide various training services to this market sector. While I’m mostly focused on Asterisk Training, Doron is focused on Linux and XEN training. Both of us have some our training routes knee deep in Israel’s computer/IT training companies, namely Matrix, Hi-Tech College and John Bryce. We both talked about our discontent with their inability to promote and market Open Source training courses, simply because they have no idea what these are.

For example, while Hi-Tech college were incapable of signing up a single person for an Asterisk Bootcamp course, I had signed up 10 people to a my first bootcamp – without any marketing or sales budget, simply by putting out the word in the right places. Now, Hi-Tech college has a list of over 5000 people who studied Linux and other Open Source and networking subjects in their college – should have they been able to gather up at least 10 people as well (less then 0.5% of their entire customer base)? the answer is a definite yes, why were they unable to do so? simply because they have no idea what Asterisk is, how it can be marketed, how it can sold and how the customer should be approached.

Doron had indicated a similar issue with both John Bryce and Matrix – however, due to other reasons. However, Doron had managed to sell quite a few training courses for Linux on his own – without any help from the big boys – how did that happen? how is it possible that Doron and I succeeded where the other colleges had failed? how can that be? – then we both realized why eventually, proprietary software will die and the Open Source movement, over the course of time, will simply negate the presence of proprietary software – simply because Open Source people provide for better marketing strategies and methodologies.

Did we learn how to do marketing on school? are we marketing people by nature? the answer is NO – we learned how to market our belief in the Open Source initiative over the course of time. We championed Open Source in various enterprises, events, public speakings and other places. We were the “soap box” speaker at Hide Park’s Speakers Corner, we were that crazy man on the street screaming: “The world is coming to an end, repent!” (well, you know what I mean) – but all in all, as time progressed we learned how to market the Open Source initiative and our belief – the large enterprises are stuck in their own belief and stagnant marketing strategies and plans. As time progressed, the various “champions” left the large enterprises, simply because they got fed up with the wrongful methodology of these and followed their own path – and doing so with moderate success.

In my belief, as time will progress, the large enterprises will surely migrate to the Open Source, and I won’t be surprised if within a period of 5-6 years Microsoft will be shipping out a version of Windows that is based on the Linux Kernel – or another Open Source distibution methodology. Call me crazy, call me chaotic, call me a dreamer – but mark my words – this will happen.

The current economical situation of the world had gotten me thinking about various things. I would say that while most people think about “how to survive the economical desert” we are currently passing – my thoughts are going to another place – I see an opportunity.

About 6 months ago a team of 58 engineers joined forces in Israel to create the itribu.com service, a “pay-it-forward” type service. The amazing thing about itribu is the fact that it was completely built within a period of less than 72 hours!

Is that logical? creating a full service in less than 72 hours? is that actually doable? even extreme programming techniques and scrum/agile don’t offer this kind of development turn around. Actually, coming to think of it, I’ve created web based services in the past on my own which took less time to develop. I’ve developed a web based telephone conferencing system in less than 2 days, on my own, so – developing a full grown service with 58 engineers in 72 hours – sounds logical.

You are probably wondering: “What is he talking about? how does itribu relate to the current economic situation? where is the opportunity?” – the answer is simple, you’re simply too stuck thinking in normal development and financial paradigms – that you are blind to the obvious. Over the course of the past month, over 2000 engineers were let go from their jobs in Israel. These are highly qualified, highly original individuals ranging the full spectrum of the hi-tech industry. Imagine that a company that had let go 10 engineers, and imagine that these engineers had decided to start a web based service. Now, imagine that these 10 engineers get into a single place for a full weekend. Can they build a service in a single weekend? the answer is a definite YES!

If creating a service is so simple, how come people are not doing it – the answer is usually simple: EGO and PRIDE. When I talked about this idea to a couple of friends of mine they both replied a simple thing: “Hmmm… Ok, sounds cool, but, what is our take in the company? how much money are we going to make from it?” – and then I actually realized: the world had completely forgotten what the term start-up means. In 1996, when the ICQ team started working on their product, they had no idea they would end up selling ICQ to AOL for 400,000,000 USD. When Sergey and Larry started Google they basically had nothing in their pockets, they almost closed Google due to a poor business model in the beginning – that’s the idea behind a start-up, you have an idea and you go for it. We had become so obsessed with business models, revenues, making money, ego, status, driving a big car – all he things that had become synonyms to Hi-Tech success, but had completely forgotten that it takes time to get there. VC’s start giving money to any company that looked like a Web 2.0 application, when actually, there was nothing behind the idea. In my view, any team of 10-15 engineers can surely spend anything between 2 to 4 weekend building a service, continue on to running it – the VC’s will shortly follow once your service becomes a craze – trust me (I’ve seen it happen more than once).

Digium started from a loan Mark got from his folks for 5000$, and grew into a multi-million dollar company. In 2006 Digium received an investment of roughly 13M$ from Matrix Partners, but that’s long after Digium was already racking up about 14M$ sales per year. JaJah started off from funds of their founders, slowly growing in number of users, shortly to follow by investments from Intel Capital and Sequoia – in other words, obsess about creating the service first – the money will soon follow after wards. Starting to argue about who gets what and how much is stupid, after all, if you don’t build it – its value is still 0!

Michael Eisenberg is a well known VC partner (Benchmark Capital) and an avid blogger. In one of his recent posts, Michael refers to 8 different approaches to raising a start-up company, in the midst of an economic crisis. The full blog entry can be found at his blog, however, after reading it myself, I would like to comment on it. The below section will also be commented to Michael’s blog for reference:

“Everyone in the company is a salesman – Your R&D team should be selling too”

This is an interesting approach, however, R&D people are R&D people because usually they don’t do sales well. Actually, most of the R&D people I know are the worst sales people I’ve ever met. To be honest, in my previous position, our R&D Manager basically screwed a 500,000$ deal that we worked on for 6 months, because I said something in the form of: “It’s possible to do, however, I can’t really say what would be required to do so.” – R&D people can easily sell products that are closed, not products that are under development. As start-ups are constantly in the development phase – this is a BAD idea.

“Hire sales people on commission only”

YES! This is a great idea, although, it means that you’ll need a hell of a lot more sales people to manage. When a sales person works on commissions only, it means that while he’s selling your stuff, he’s selling other stuff too. It requires a certain degree of finesse and agility to be able to manage such a team, but the general idea is good, actually it’s GREAT!

“Virtual company”

Michael’s idea of a virtual company isn’t new, dozens of companies around the world utilize this methodology. However, this methodology sometimes requires quite some resources. For example, according to Michael, the utilization of sites like oDesk and rent-a-coder may assist in your quest to lower general spending. That is true, however, it automatically poses a problem. Let us imagine that I develop a service that is made of 3 distinct areas of expertise. I hire all coders from oDesk, now, I need to remotely co-ordinate them all, so that the code I’ll get is manageable and well documented. If not, the end result will a running service that becomes stagnant, as no one can go into the code and continue its development (seen it happen to 2 of my customers, both start-ups).

“Choose Self-PR over paid search”

Hmmm… I can’t really comment on that, as I practice it – and can honestly say, it’s very hard.

“Focus on product”

Killer applications in the web are a must, if it’s not a killer – your service is dead in the water. Killer services like PokeTalk have a great potential to become the next big thing, but they highly rely on the company’s ability to market the product correctly within the available channels.

“New distribution channels”

Michael talks about the creation of affiliate programs – that’s not as simple as it sounds. Many companies made a shitload of money out of building distribution channels and affiliate program management systems – affiliates are a wonderful idea as long as you are capable of managing these in a proper manner (See my comment about commission only sales people).

All in all, Michael surely has some valid points, however, these require delicate work and proper management in order to work right – if executed improperly, will not only end in failure, may also send you down debt country.

I’m not much of an economist. I understand income and expenses, I understand more or less how the stock market works from time to time, but I’m no economist. I’ve been in the hi-tech industry since early 1997, which means, that I’ve seen this world being elevated to the level of godly hood, buried alive with the explosion of the dot.boom era, only to re-invent itself as a highly competitive telecom’s industry and the “Network is the Computer” manner of thinking.

About 2 weeks ago, a man I truely admire had written a post entitled: Economic Meltdown – Friend or Foe of Open Source? (written by Danny Windham, CEO of Digium). Danny talks about the various aspects of companies cutting down on their IT budgets and reversion to Open Source technologies, as a means to hedge needed cash. As I witnessed the Dot.Boom explosion of 2001, I can honestly say that 2001, at least as far as I can say, was the year that Open Source technologies had truly assimilated to the normal business practice of companies. Even beyond that, companies which were not based on Open Source and Linux/Unix based technologies were clearly not a valid option for investors.

One of the urban legends talks about Hotmail wishing to acquire an Israeli company called Commtouch, back then, a webmail company. Commtouch was purely based on Windows NT technologies back then, and while the business track of the negotiations were going fine, the deal collapsed as the technical sides, of a back then BSD based Hotmail, basically negated the deal. Now, I have no idea if the story is true or not, again, this is an urban myth, however, I believe myths are usually based on some portion of the truth - at least to an extent (even a small one).

While the adaptation of Open Source technologies is a must for companies, in order to survive the troubled waters of these time, it is highly dependant on the solution providers, consultants and IT outsourcing companies. In Israel, for example, it is very much a customary to hire outsourced IT assistance, on a part time basis, allowing you to cut your IT costs. When bringing in IT assistance, you’re not only bringing in IT assistance, you also bring in IT governance and IT policies – as an outsourced IT person will usually operate under the terms he had learned in his company. If his company is a M$ oriented company, no matter how Open Source will be crucial to the business, M$ will still rule the domain in that area. I believe that the first thing that needs to happen is for the consulting and IT outsourcing companies to realize that they need to change, first for their customers, then for themselves. If the small start-up companies and established companies will start falling, the consultants will simply dry out of work.

It is our responsibility as IT/Telecom/Development/Architecture/Design consultants to explain the aspects of using Open Source, assimilating it, integrating it, both the pros and the cons and then, assist our customers in doing so successfully – this is the only way to go.

For example, let us take examine the following scenario – a telephony service provider. Our telephony service provider is based on Asterisk as the switching environment, a purely M$ base for all the billing, web front-ends, databases, development and so on. Their entire IT infrastructure is fully owned by them, all running with ESX servers and other proprietary technologies. This company will be required to pay hundreds of thousands of dollars every year, for support purposes (and the year is coming close to an end), their expansion is highly dependant on 3rd parties and while they are self sufficient on the IT side, they are purely dependant on the technology side. Now, imagine that this company would have had their entire back-end based on Open Source technologies, let’s imagine PostgreSQL and Ruby on Rails as the web frame work, how much money will that save per year? now, let’s remove ESX out of the equation… let’s also remove non-Open storage solutions and replace those with CoRAID or something similar, we’ve saved hundreds of thousands of dollars on an annual basis. Radical? – YES! But drastic times call for drastic measures, and when drastic measures are required, Radical solutions are a must.