Nick Carr explains it pretty well. He quotes John Mark Walker's article, "There is No Open Source Community":

"Software developers have two choices when trying to win over users: (1) add features not available elsewhere, and (2) release the source code. There is no other currency of value that developers can extend to users." And because open source development is the most efficient way to produce valuable new features, "open source becomes a necessity in a competitive market."

But there's more. Carr correctly notes:

As Joel Spolsky points out in his excellent book Joel on Software, "demand for a product increases when the price of its complements decreases. In general, a company's strategic interest is going to be to get the price of their complements as low as possible ... Understanding this strategy actually goes a long, long way in explaining why many commercial companies are making big contributions to open source."

In my opinion, open source applications are a must, if for no other reason than they are more conducive to customization. If you're in a growing Internet enterprise, or if you plan on building a growing enterprise, you'll most likely want to automate as much low-level, non-creative work as possible. Open source means full customizability -- the source can be fully accessed -- and hence various open source applications can quickly be pieced together to create a quality system that allows you to automate the business processes that your business needs to automate.

Any way you slice it, open source is the way to go.

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