Less Dosh for OSS...And So?

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According to one of 451 CAOS Theory's invaluable roundups:

The raw data indicates open source funding fell more than slightly in 2007. Disclosed funding deals were down 40.7% to $323.87m for the full year, compared to $546.3m in 2006. While a reduction in funding had been expected after the huge levels seen in 2006, a dramatic reduction in funding during the fourth quarter meant that total funding for 2007 was also lower than the $334.82m raised in 2005.

Is this serious – a sign of some deeper malaise? I don't think so. VCs are notoriously fickle fashionistas: open source was flavour of the month for a while, and maybe now it isn't. One consequence of this is that VCs snap up the obvious investments in a field, and now they've all been made.

It's striking that all the main categories for enterprise software – databases, application servers, content management, business reports, CRM – today sport several rival open source offerings, and usually a clear leader too. The one area that remains somewhat up in the air is ERP, but even there things are beginning to move.

Above all, it's important to remember that open source – or rather, free software – is not about cash, it's about collaborative creation. Whatever the VCs choose to do, there will always be coders out there, churning out great programs, and giving them away.

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