The new frontiers for open source companies are social networking-related applications and Software as a Service, said Paul Sterne, CFO of Open-Xchange. "The appetite now in the venture community is to identify companies, like ours, that sell open source products into the Software as a Service environment," he said.

By definition, free and open source software (FOSS) is opposed to proprietary companies. But, as Jim Zemlin and Stephen J. Vaughan-Nichols have pointed out recently, the FOSS community does not regard all proprietary companies with equal disdain.

Unlike proprietary software, open source software is not developed by a single company or group of developers. Instead it is developed by many different companies, thousands of individual developers and hordes of hobbyists.

Let’s do a small intellectual play: Web 2.0 services, or the current generation’s internet companies globally, are built for the most part on top of the so-called LAMP-stack. In other words their infrastructure is based on Linux, Apache, MySQL and PHP – a selection of open source software programs.

Red Hat (NYSE: RHT) and Ingres will offer a combination of Linux, JBoss middleware and the Ingres open source database as a new open source software stack to application developers around the world, the companies recently announced.

OpenLogic provides the kind of support for open source software that many companies have come to expect with commercial software, as summed up by one of OpenLogic's bloggers:

"What we consistently hear is that companies need and want the same services for open source software that they get from proprietary software. Hence the rise of open source companies…."

Tim believes that open source, at least as defined by open-source licensing, has a short shelf life that will be consumed by Web 2.0 (i.e., Web companies hijacking open-source software to deliver proprietary Web services) or by traditional proprietary software vendors.

"We will do some buying of companies that are built around open-source products," Ballmer said during an onstage interview at the Web 2.0 Summit in San Francisco.

Open source has infiltrated so many levels of IT over the past decade. It has been a slow process, however slowly but surely it has become a normality. And even though many companies are adopting open source software, they are hesitant to bring open source developers into the fold. Let’s take a look at some good reasons to hire open source developers.