opinion


Best of both worlds


Richard Wyles I


was recently asked about the increasing popularity of Software as a Service (SaaS) versus the rising trend towards open source solutions – which approach would win out?


The answer is both, the trends are complementary and learning technology offers a cogent example. At a basic level a learning management system (LMS) is a technology that is used to manage learners and learning events. Most platforms will also enable the creation, management and delivery of e-learning courses. As with other product types it’s often only a small part of the application that differentiates the feature-set between Product A versus Product B. So, perhaps 80% or even 90% of products at the enterprise level have relatively common features. The core components have become commoditised, driving down prices and expanding availability either through turn-key SaaS or open source collaborative models. SaaS is game-changing as it lowers the cost of


deployment. The delivery mechanism is the internet and through scale SaaS offers tremendous cost advantages to businesses. It is a strong driver of commoditisation because the barriers to new entrants are low. This trend is demonstrable in the LMS marketplace with over 400 LMS vendors and no single player, despite their claims, dominating the market. Commoditisation for software users is unquestionably positive. For vendors there is a constant challenge to improve and differentiate. Of course it’s inefficient to build the commoditised pieces anew – that’s reinventing the wheel. As more components within competing platforms become indistinguishable it drives the competitors to build atop them to create new and innovative products. In effect the relentless need to innovate and differentiate is driven by the speed at which software components become standardised. Open source accelerates the commoditisation process by opening the intellectual property of new innovations and knowledge. But it’s wrong to suggest open source is simply commoditising proprietary innovations. In contrast, open source enables the


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How the customer can retain control over their destiny and mitigate the risks of future switching costs


new innovations to be built on top of the commodity software on a mass scale. Open source offers adaptability at a level


that even highly configurable SaaS offerings are intrinsically unable to match. At its essence the core proposition of open source is that it enables mass specialisation; that is the innovations, large and small, which would not have otherwise been possible if the software they are built upon was not open, both in licence and technical architecture. The fun is at the edges – the differentiating features that disproportionately add value by strongly aligning to the business’s specific requirements. Not all, but some of those innovations, find their way back into the core product and that accelerates the commoditisation process further. The technology lifecycle moves from differentiating feature to commodity component and that’s a natural process being played out across all sorts of product types in society.


With no single dominant players in the LMS market (no vendor has more than 10% market share), there is an opportunity for a well-executed open source vendor to secure large market share by both accelerating the commoditisation trend and accommodating increasing specialisation through customisations of the open source codebase. Enter Totara LMS, and yes I happily declare my bias. I argue that the evidence is there through all the corporates, government agencies, and not-for-profits that have selected Totara as their LMS. Price is always a key part of the selection


criteria. However, the primary attribute is probably best summed up by the word adaptability and that attribute stems from the freedoms that come with open source. Freedom to innovate, integrate and extend. Freedom to choose your provider, avoid lock- in and adapt to fast-moving business environments. Alternatively you may not want or need to


innovate or change the software to suit changing requirements. The configuration options and feature- sets meet your needs out-of-the-box. The software


is “good enough” as it is. In that situation selecting a SaaS offering makes perfect sense. But will that always be the case? You might not be able to think of new requirements now but one thing is certain in the modern economy; change is constant, and having the option to adapt to changing circumstances is the smart move. OpenSaaS, which means open source software


that is also available as software-as-a-service, offers the best of both worlds (The term OpenSaaS comes from Andrew Hoppin – see http://nucivic.com/ opensaas-future-government-innovation/). You can receive the speed of deployment, support and often lower up front cost benefits of a SaaS offering. Then as your needs evolve over time, you have the option of migrating and leveraging the innovation potential, freedom, and control over your destiny that open source offers.


OpenSaaS is the only SaaS option that enables customers to retain control over their destiny and to mitigate the risks of future switching costs. At Totara Learning, we are evolving our business model around OpenSaaS. Totara Cloud is an online LMS that a customer can subscribe to as a turnkey supported software as a service, or alternatively subscribe to the same product as a download, with support available through subscriptions and a worldwide network of Totara Solution Partners. OpenSaaS offers customers the best of both worlds – and for our ecosystem of Totara Partners the models are synergistic rather than being conflicting trends. Open source is the engine for distributing new innovation while SaaS provides huge efficiency for serving technology that is “good enough” to meet most requirements. For these reasons, at Totara Learning we see both trends thriving well into the future.


Richard Wyles is CEO at Totara Learning Solutions www.totaralms.com @totaralms


e.learning age september 2014


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