“Open Source” and “Software as a Service” (SaaS) are big buzzwords these days. And rightfully so. Both are viable approaches to mitigating the often high cost of software and infrastructure. However, to date these two approaches have largely existed separately. There are a few exceptions to this, such as SugarCRM who offers their software with both the ability to download the open source version or pay a small monthly hosting fee.

I won’t go into the advantages of either approach here as a simple Google search on either term yields more than enough information on the topics. I’ve also touched on some of them in a previous post.

However, recently when I was looking at how to set-up a website, email and blog for my wife’s business, I stumbled across a plethora of new options that simply didn’t exist a couple years ago when we set-up Latigent.

With a little research I figured out that the Open Source Content Management System (CMS) Joomla would be the easiest way to get something up and running. The software was free and the options for plugins was mind numbing (similar to my theory on salesforce.com’s success).

The next trick was to find someone to host it for me. That’s when I found BuyHTTP. They have several economical plans starting at $4.95 a month, but for only $24.95 a month I get unlimited websites and MySQL databases.

So why would I need unlimited websites and MySQL databases? Good question, let me explain.

My wife is in real estate, so my first inclination was to create individual websites for each of her property listings and interlink them all. Google traffic in the making, I thought.

As I was configuring the first site, I stumbled onto Fantastico, which is an autoinstaller for several open source programs (Joomla included). What I found next was like opening Pandora’s box.

Inside the Fantastico control panel I discovered that I could install any of roughly 30 open source applications directly into the website. These cover everything from blogs and wikis to online chat and e-commerce; so basically most anything I would need to run a small business on the web.

With a little elbow grease I was able to install the core apps and hook them into the main Joomla site. No Consultants, No Developers, No Headaches…

Also during this I migrated my TypePad Blog over to WordPress on this website. This alone saves me $11.95 a month.

Now, just when you thought it couldn’t get any better, check this out. I downloaded SugarCRM, uploaded it to my managed server, and installed it on its own subdomain in less than 15 minutes. I was prepared to cough-up the $65 a month for the basic salesforce.com account but this new solution saves me that cost and I control the domain and database.

I truly feel this model is the best of both worlds for the SMB. It allows me to be in control of my own destiny without having to host everything myself.

I foresee a real market opportunity for someone to stitch together and integrate these open source apps more closely, as well as bundle some baseline consulting around the installation.

So for now, I will enjoy running almost all of my wife’s business on the web for $24.95 a month. Somebody pinch me…

-Chris