Interesting question. No right or wrong answer (yet).

I have been asking why $CRM (salesforce.com) has been hammered on Wall Street. SaaS should make more sense as you point out. But for me, that issue has almost zero relationship to the OSS model.

Allow me to assume that you have read Young & Rohm’s “Under the Radar” about business models?

It has been a year or so since I last read it, but do not recall anything to suggest an “either or” (XOR) decision. I see nothing in my travels along the information superhighway to suggest that one must choose one model over the other. In fact one of my favorite apps, SugarCRM seems to offer both models.

Yes, I understand that you (and most of the world) have limited resources. Therefore, YuuGuu may have to pick one over the other. However, I do not think you are asking the proper question (Is SaaS killing OSS?)

The better question for you, is along the lines:

What do our customers need to succeed?

You will recall this being referenced as “find a need and fill it.” You guys have done that. Or least made a great start at filling the need. And back to the ‘money’ issue, one of your competitors seems to have more money for advertising than “stars in the sky”. I trust you know that “no one wins a price war!” Especially with your selling price point. {grin}

As I suggested to NuSphere (years ago, during a spat with the MySQL folks), you might want to consider forking. But in your case: fork the company. Your opening remark (above) talks of “expand development and distribution” which in my world, are two very different silos with very different requirements.

Conclusion: I do not believe Saas will (or could) kill open source.

-ski