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The Sweet Stuff is Sugar's Exchange

With over a million downloads, you'd think that open source CRM vendor SugarCRM was doing just fine on its own. As it turns out, it's getting by with a little help from its friends.

SugarCRM is growing via its SugarExchange marketplace, which offers production-quality, third-party extensions for a fee. The vendor said there have been more than 7,000 transactions spread across over 68 different vendors on SugarExchange, which launched in October. And although it doesn't directly compete with proprietary vendor Salesforce.com's AppExchange, the concept is the same.

"Exchanges are a hot item in the industry, and there really is a scramble around ISVs to go out and create their own exchanges and build and extend their ecosystem of third-party applications," Paul Oh, director of technology alliances at SugarCRM, told internetnews.com.

In SugarCRM's case the exchange model is a critical part of how the company is able to market itself.

"Because of the way that Sugar is distributed a lot of customers make their decision about using Sugar are in a sense doing so by seeing what is available on SugarForge and Exchange," Oh explained. "If a customer sees that functionality is available, that does influence the decision they may make for using SugarCRM."

Oh said that, while SugarCRM continues to evolve and add new functions, it can't always have everything directly baked into it. The SugarForge is the community effort where open source developers build and extend the SugarCRM product.

Oh admitted, though, that the Forge is a bit of a Wild West for users who simply want to buy extensions. The Exchange is a differentiated offering where users can go to buy production ready extensions.

SugarCRM requires a higher standard for extensions that are in the Exchange as opposed to the Forge. Among them is a requirement that applications work with all versions of Sugar rather than only the open source version.

There are also requirements around packaging, upgrades and user interface, said Oh. Many of the extensions on SugarExchange are completely commercially based in the sense that they don't necessarily have an open source offering available.

Oh said they have had some education issues with commercial developers. Chief among them is making sure vendors understand they don't have to change their license to sell extensions on the SugarExchange. SugarCRM allows vendors is stick with the same commercial license they are already using.

Though the focus of SugarForge and SugarExchange is to extend the core SugarCRM offering, there is no guarantee that similar functionality won't end up in a future version of SugarCRM.

"There are solutions that have been third-party solutions that end up in Sugar," Oh said. "We're constantly trying to improve the functionality of Sugar as we come out with new versions; we don't see that as a conflict."

SugarCRM is expected to update to version 5.0 this summer. The last major release, version 4.5 was out in July.