Back in April I stated that “how” was the most important question open source vendors could answer. That statement was based on the need to encourage greater adoption of open source software by demonstrating to enterprise users the potential advantages of open source software.

While that need remains it has occurred to me that there is an even more important question open source vendors should be asking themselves: “Why?” – as in “Why are we building a business on open source software?”

The answer to the question “why?” has the capacity to explain which business strategies an open source vendor should be following, whether it is likely to gain a share of what little funding is available, and whether it is likely to survive current economic conditions.

Put another way the question vendors should be asking themselves is “What do we gain by being open source?”. If your answer to that question is no more than “It puts our software in the hands of more users” or “It seeds the market for potential customers” then you are failing to benefit from the full advantages of open source.

If you are not doing something with open source that you would not also be able to do with freeware then you are failing to live up to your potential.

There has been a lot of talk recently about whether the economy will be good or bad for open source. There is no doubt that businesses are being driven to look for lower costs solutions but that will take time to percolate through and in the mean time many open source vendors appear to be in precarious positions given that funding is likely to get harder to come by.

My answer to that is that, as in any crisis, it is the strong that survive. There are still customers out there if your products are good enough and there is still VC money out there if your business is good enough.

When it comes to open source, strength does not come from download numbers it comes from the use of the open source development and distribution model as a strategic weapon – as a means of enjoying greater economies of scale, or disrupting a competitor, or improving the breadth and depth of the code.

The answer to the question ‘why?’ is also at the root of deciding which open source development, licensing and revenue generation strategies are right for your company. The focus should not be on “Which strategy will provide the most revenue?” but “Which strategy complements our reasons for using open source?” If you are playing to your strengths the revenue should follow.

It is not enough simply to have open source code, it is what you do with it that counts. Open source for the sake of open source will get you nowhere. If you cannot answer the question – and more importantly articulate that answer – then you will also end up going nowhere.

So why are you building a business on open source software?