Open source enterprise systems (OS-ES) have become an appealing option for small and medium-sized enterprises (SMEs) to bring powerful business computing tools into their organizations. However, the impact of OS-ES is still in their nascent stage because of the critical challenges they pose. We conclude that the challenges of OS-ES mainly come from three perspectives: limited economic scale, product-oriented business strategy, and insufficient product support. In this study, we propose that the emergence of cloud-based technology can catalyze the flourishing process of OS-ES market through leveraging both the OS-ES user-side and developer-side economic scale. Because of the two-sided nature of OS-ES market, we then draw on the cross-side network effects (CNEs) theory to explain the positive reinforcement loop between user-side adoption and developer-side engagement of OS-ES projects.



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