With outsourcing an increasingly hot topic, we were curious how a company profiled here in 2001 was faring in its efforts to build a community-driven outsource software business.

Instead of hiring a legion of developers to open the company in 2000, Quovix established a community of freelance developers and created software that lets the company shop out and award projects to this virtual team.

When we caught up with Quovix in September 2001, it was announcing a packaged version of that home-built project management software so other companies could use the collaboration tool to create and manage their own project teams.

And in fact some customers signed on, says Martin Morrow, founder and CEO. A large pharmaceutical company bought a copy to harness the energy of 25,000 scientists working on chemistry problems.

But the packaged idea in general fizzled, partly because collaboration hooks started showing up in all kinds of software, Morrow says. So the company stopped selling that and stuck with its original software service model. And that, too, has evolved.

Instead of trying to educate customers about the benefits of community development - cheaper, faster - Morrow says he simply promotes his product as a no-hassle alternative to offshore outsourcing. "We offer benefits that are similar to going offshore, but you're not really going offshore."

Morrow says he can deliver software for 20% to 30% less than most in-house shops because his stable of 1,400 freelance developers have experience with a range of problems, reducing development time. When a new project comes in it is posted for the community to review, and people with the appropriate talents swarm on it, what he calls swarm sourcing.

The ability to get the attention of so many developers also means Quovix is good at solving the thorniest problems. "Someone is bound to have experience with anything we see," Morrow says.

And, as it turns out, the community approach is good for the smallest jobs. Quovix has set up sub-communities that are good at things such as Java and feeds them, on a rotating basis, micro projects that take a few hours. Customers win because they normally can't find anyone willing to take on small projects, and Quovix developers get a steady enough stream of small jobs to make it worth their while.