Historically open source software has been synonymous with non-commercial or non-profit.
While that’s always been an incorrect assertion, nowadays it is becoming blaringly clear that the open source movement will morph more and more into commercial and for profit enterprises.
Today OpenAds, an open source ad server I considered using but did not for a few reasons, announced that it raised $5M.
OpenAds - formerly known as PhpAdsNew - follows in the footsteps of Mozilla, BitTorrent, WordPress as Paid Content points out in terms of open source entities that have taken a commercial turn by raising money.
That’s right, they’ve gone corporate, not that there’s anything wrong with that. We use Wordpress on our blog network by the way.
OpenAds is already being used by 20,000 publishers across 140 countries in 20 languages and powers more publishers than all competing solutions combined. Of course, that’s because it’s free… it will continue to remain free despite the VC cash injection.
I was thinking of the rationale to plunk $5M in such a venture (there’s a lot of merit for it, just look at the demand for ad serving technology in 2007 with aQuantive, Doubleclick and 24/7 RealMedia) and then I came across Jeff Jarvis’ post on “The open ad marketplace,” with all due respect to Mr. Jarvis, as an ad sales guy myself, I think that the concept of a universal marketplace for ads is still a lot of theory and not practice and to some extent, Google is the closest thing to it and will fight tooth and nail to hold onto it. The argument could be made that some publishers will welcome an alternative to Google, but the real case will be made for publishers to retain the power and relationship with advertisers and not trade one necessarily evil with another. In other words, if OpenAds remained VC-free, then I could see it happening, slowly but surely; but with VCs in the landscape now, kiss that proposition goodbye.
In fact, OpenAds will lose a few accounts just as it’s likely to win a few accounts by raising VC money, but a few of the arguments and things Jarvis outlines are worth considering or at least thinking about in the back of your head, namely: “We need an open-source standard for measurement that tallies not just audience and views but other key values of citizens’ media.”
Investors include First Round Capital, Mangrove (backers of Skype, by the way) and O’Reilly AlphaTech Ventures. Read more on First Round’s rationale here.
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