In a recent article, Matt Asay was musing about the aspects of hosting an Open Source project by yourself vs. using a public project hosting service like SourceForge, GitHub or Launchpad. He concluded that it's important for commercial/sponsored open source projects in particular to do the hosting by themselves, so they can maintain full control and can gain more insight, which hopefully will turn into more revenue at some point.
However, Matt seems to reduce "hosting" to "providing downloads" only:
Control and visibility. Given the importance of customer conversions, it becomes hugely valuable information to know that it takes, say, eight months on average for someone to buy the "Enterprise" version of your code after downloading the software. With Sourceforge et al., you have no way of connecting the dots between download and purchase. But if you host your downloads, you can suddenly link a download to a purchase using marketing automation software like Loopfuse.
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It can tell you many things, but the key is to be able to glean insight from the earliest stage of your interaction with a potential customer, and that means you have to host your own downloads. Otherwise, you have no idea how or when a would-be customer downloads your code, which makes the "why" they download it less interesting, because it becomes less actionable.
I understand and agree to Matt's point in principle - you want to know more about the users that download and use your stuff. Here are some related thoughts about this topic.
Project hosting is not just about downloads
First: project hosting is much more than just providing a download/mirror infrastructure for your product releases. On the one hand, you have the regular users of your product who are primarily interested in having easy and fast access to the latest builds for their platform of choice and a platform to exchange their problems and experiences with other users.
But project hosting facilities also address a completely different audience, with different needs. These are the developers, who want to have easy access to the latest source code, be able to submit bug reports and patches and want a direct communication path to the project's developers.
I think it is important to ensure that you serve both the developer community as well as the user community as best as you can, which could of course mean you should provide the full range of project hosting all by yourself. But by doing so, you also create an island that makes it difficult to benefit from the "cross-pollination effects" between your project and others. This can partially be remedied if you don't only set up a project hosting infrastructure for your own purposes, but also open it for projects related to your project (and which not maintained by your own team), e.g. how SugarForge is doing it. But the cost and effort involved in setting up and maintaining such an infrastructure should not be underestimated.
There is more to distribute than releases
At MySQL, we just recently moved away the MySQL Server source trees from the proprietary BitKeeper revision control system to Bazaar. Along with this migration, we also relocated the public repositories from mysql.bkbits.net to Launchpad.net, to make it easier for external developers to access and work with the code. Currently, MySQL only makes use of the source repository hosting capabilities - downloads, bug reports and most other things like mailing lists or forums are all maintained by ourselves and hosted on mysql.com.
Due to the distributed nature of Bazaar, we could of course also provide the source repos from our own servers (similar to how we do it for several of our projects that are still maintained in Subversion). But I think it makes a lot of sense to use Launchpad for that, as it allows a tighter integration and collaboration with contributors and other related projects, and it gives us more visibility within the developer community.
Drizzle has taken this even further: the project utilizes all of Launchpad's facilities, including Blueprints, Bug reporting, mailing lists. It's going to be an interesting learning experience to see how this affects and improves community interaction/participation. I'd love to see MySQL move more into this direction as well (especially the bug database and worklog would be good candidates), but this probably will take some more time.
I too recently moved the source tree of my own personal project from a Subversion repository on my private server to Launchpad. Several reasons motivated me to do this, one of them being the opportunity to gain more practical experience with Bazaar and getting away from a central source code repository that makes me the bottleneck in making changes and applying patches. A distributed revision control system makes much more sense from a community contribution point of view, which Ian Clatworthy summarizes quite well in his paper "Distributed Version Control Systems - Why and How". In a way I deliberately give away some of the control over my project. And I must say I like how Launchpad integrates the various available subsystems like blueprints, code branches and bug reports - things are much better connected and they provide useful workflows that make the entire system much more productive to use than e.g. SourceForge.
I still provide downloads of released versions from my own site (as does MySQL), but mostly because I actually did not know until recently that Launchpad offered this kind of service - I will look into that for the next release. I am more interested in making sure that my users have easy access to properly packaged versions of my project for their operating system of choice. Therefore I work closely with the packagers from various distributions and make sure they integrate new releases quickly. In addition to that, I make use of hosted services like the OpenSUSE Build Service, which automatically provides package repositories for a number of platforms. I aim for wide distribution on as many channels as possible, instead of trying to be the sole provider of my product. This brings me to another point:
Downloads stats are overrated
Direct downloads from your project's web site usually are only one part of the distribution system. I believe that being included in the various Linux or other Open Source Operating System Distributions (e.g. Free/OpenBSD, OpenSolaris, etc.) plays a much bigger role in gaining popularity and reaching more users. Most users usually go with what they get as part of the package, as the distributor usually has taken care of a tight integration and proper packaging of your project within his own product and also takes care of providing updates and fixes.
Unfortunately it's almost impossible to gather any detailed intelligence about the number of users of a project this way, as distributions usually don't keep track of (or don't disclose) their download figures and which packages on their releases are the most popular. Debian's Popularity Contest is probably the only exception to this, but it's unclear how reliable that information is. Here I must agree with Matt again, if we just look at project hosting services acting as download providers only and include distributions in this equation:
As open source becomes more commercial, someone is going to need to step up to offer such visibility into these hosted services, or we're going to find the hosted services proving useful for ever decreasing amounts of time.
I guess we all would love to know more about the users that don't download a package from our site, but go with the one provided by their distribution of choice instead or download it from somewhere else. But so far, this is a blank spot on our radar screen.
Another caveat that results from these multiple distribution channels: just looking at your own download stats may actually give you a skewed picture of your user base, particularly if you look at the platforms (which will probably be dominated by Windows or Mac OS X, as these OSes usually don't ship your code as part of their own product).
So instead of trying to force downloads through a single instance only, I think it's much more important to ensure widespread distribution and a top-notch first hand experience. If users like your product, they are much more inclined to consider coming back and purchasing something from you than if you annoy them by making your product hard to download and install or require them to register before they can obtain a copy of your product. It's all about lowering the barriers as much as you can, even if you have to give up some control in exchange.
Just to remind you that 
