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Updated Zelerate, one of the most closely-watched commercial open source ventures, is to lay off 34 staff, according to a company spokesman. The company's Albuquerque office will close as part of the cost-cutting measures.

Formerly known as OpenSales, the San Mateo-based company markets AllCommerce, a storefront and content management server which competes against the likes of BroadVision and Microsoft's IIS. With some considerable success too: the server bested Microsoft and IBM offerings in a PC Magazine application server "bake-off" last year, and claims a growing number of blue-chip customers. AllCommerce is cross-platform, and released under GNU's General Public License.

OpenSales wasn't the first company to give away its crown jewels and seek VC money for a service model around the product: Zope probably takes the credit for that. But it is the most prominent back office, as opposed to infrastructure product, to fly under the open source flag.

The move is thought to be at the request of investors, who want to accelerate the company's move to profitability, rather than any uncertainty about Zelerate's innovative business model.

"It's what the market is looking for in general - it's not just us," a spokesman told us this morning, Pacific Time.

He stressed that going profitable didn't mean going proprietary:-

"The GPL is the cornerstone of our business. That remains - absolutely."

Staff were informed on Friday. ®

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