The deal, for an undisclosed sum, will see Fonality embed Insightful's open-source customer resource management technology into its own open-source PBX telephony systems.

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Chris Lyman, CEO at Fonality, in Los Angeles, said the company launched its first channel-only product, Trixbox, two months ago, and found that partners were looking for a CRM system alongside it. "The pain point wasn't telephony for the call center, it was CRM," he said. "We did use SugarCRM, an open-source CRM system, with our telephony, and then got to know Insightful."

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Marc Englaro, formerly CEO of Insightful and now general manager of the CRM division at Fonality, said Insightful has gone from a two-man business two years ago to a 15-person business in 2007. He added that the two firms started talking and realized the opportunity they had. "We did some work on Trixbox and realized that telephony integration on open source wasn't something in the market for our SMB customer range," he said.

Lyman said following the acquisition Fonality will launch an integrated product in two stages. "The first version, which comes out this month, will have Insightful's CRM technology lightly integrated with ours. The second launch, next quarter, will be a fully integrated CRM and phone system based on open source."

He said the products would ship through the channel and that Fonality's VARs would not need lots of training to sell it. "Most of our VARs are from the data side, so selling the telephony system is actually more of a challenge for them. CRM is a great product for the channel, because it's sticky and we'll be selling at 40 percent less than Salesforce.com," he said.