With respect to the small subset of the software market that he is referring to, it does indeed seem that the open source proposition offers no viable competetive advantage when software is used as a service.  Wow I hope microsoft never finds that out.

 

Free software is a significant part of the open source movement, but certainly not the only magic bullet when faced with the incumbent vendor lock-in strategy that is an apparent side-effect of social networks, (value is in the content, provided by the users).  Open standards and seamless connectivity will be a driving force in avoiding such a deadlock.  How many users of social networks have more than one site?

 

Eventually we can look forward to a social site API that allows integration between the big-name social sites for true Internet collaboration. Then we’ll see that open source isn’t dead, just biding it’s time.