OpenERP Solves Open Source’s Vexing Problem: Making Money

Belgian open source application vendor OpenERP has set up its first overseas business office in San Jose, Calif. Traditionally, the company has worked with reseller partners in the United States and 54 other countries worldwide.

After four years, though, OpenERP has begun an aggressive expansion.

It plans to have 1,000 partners around the world by the end of 2011.

OpenERP’s apparent success is perhaps due to an unusual business model that rewards partners well, offers only one version of the software for both on-premise and Software as a Service (SaaS) delivery, and gives back to members of the community by incorporating their modifications into the core application.

Traditionally, open source software companies make money in one of two ways: They release a light, open source version of their product for free and sell closed-source versions with additional modules; or they offer an open source version for free and a paid enterprise edition version that has some different features, and provide bug fixes only for the enterprise edition.

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