Open-Xchange Goes After Exchange
Open-Xchange Inc. made a move to become a much bigger deal in the Web hosting
world recently by signing an agreement with the German-based 1&1 Internet
Inc., the world's largest Web hosting company. The deal lets 1&1 provide
hosted e-mail and collaboration services based on Open-Xchange's Smart Collaboration
This move, which could potentially reach millions of users, is also intended
to beef up Open-Xchange's Software as a Service (SaaS) strategy. The arrangement
now gives thousands of ISPs worldwide the chance to offer both Microsoft-based
hosting solutions alongside lower-cost open source solutions. Redmond
Editor Ed Scannell spoke with Open-Xchange Chairman Rafael Laguna about the
deal and what it means for his company, as well as for furthering the prospects
of open source service providers in general.
Q: Why do you believe this is an important deal for not just Open-Xchange
but the open source community in general?
Rafael Laguna sees the 1&1 deal lifting the fortunes of open source
Laguna: We think it's significant because open source is taking a big
step up the applications stack. We've all seen the success open source has had
at the operating systems and middleware levels, but this is happening in the
applications space -- specifically the collaboration space -- where there's
a lot of opportunity right now for open source products. The parent company
of 1&1 Internet, United Internet [AG], is the world's largest Internet hoster
[4 billion euros]. They've decided that in addition to pushing Microsoft Exchange
they needed something that's more price-aggressive and offers better functionality
that lives side by side with Exchange. This deal allows them to push Open-Xchange
Q: What market opportunities does it open up for Open-Xchange to better
operate side by side with Microsoft's Exchange?
Laguna: Open-Xchange is already integrated into Outlook, so Windows
users can continue using Outlook along with the rest of the Microsoft Office
suite. But now [users] can also take advantage of Office functions such as document
management where [they] can store [their] files or link things to appointments.
It can improve the way people deal with the information they work on every day.
The lower-end market so far has nothing available to help them with things like
this. Most collaboration software is too expensive.
Q: How does this deal advance your SaaS model?
Laguna: Software as a Service resonates well with open source. If you
look at what open source has done for helping create the Internet, or helping
companies like Google, Yahoo! and 1&1 come into existence, you realize the
Internet and Web itself wouldn't exist without open source software. Companies
like Google and Yahoo! couldn't create their services at the current price points
without open source software. This is why open source is in the DNA of these
companies. But what services companies need to do now is offer more services
to customers. One way to do that is provide software functions that have not
been available on the Web to date, and this is what you see Google and Microsoft
doing. There's this huge space in the market that will be served by the hosters
-- right now [they] control about 1 billion e-mail accounts worldwide.
Q: How does this deal enhance the collaboration capabilities of your products?
There seems to be a market opportunity in Web 2.0-style collaboration, but only
a few open source companies are pursuing it.
Laguna: I absolutely agree. Open-Xchange is a child of the Internet.
Our software has always been designed to run inside a browser and so we have
always been able to do Web 2.0 stuff. From a development standpoint that's very
different than the old client-server model of Microsoft and Lotus. So in going
to the next step with SaaS we not only have a few hundred people online, we
have millions of people online. This creates a platform for applications we've
yet to see. It'll be very hard for proprietary software companies to compete
with this model.
Q: Do you see Open-Xchange getting into the applications business as a way
to grow your services business?
Laguna: You'll not see from us a Web-based competitor for Office, or
an AJAX-based word processor, because we feel people already have their favorite
word processors. We just want to be the platform that makes them integrate their
existing stuff, but also the company that delivers the core functions that make
Web 2.0-type collaborations possible.
Ed Scannell is the editor of Redmond magazine.