A software development team often work to release its product in stages. A common practice is to solicit input and advice from a community, such that ideas, suggestions, and improvements can be shared and incorporated before a final product is released to the general public.
In this type of production process (also known as software release life cycle), alpha is the first stage, consisting of the very first version of a primitive, basic software or product. During the alpha phase, the software is submitted to various tests, starting the production and feedback loop. It is a key milestone for developer teams because it allows for some degree of product iteration - which, in turn, provides further insight into the efficiency and quality of the software.
Both approaches have their pros and cons. On the one hand, an open alpha may be able to collect data from a much larger sample, whereas a closed alpha to a select group may allow the team to gather feedback directly from specific target demographics. Thus, a closed alpha may be useful when dealing with the first audience that the company is aiming to target with their final version of the software.
Depending on the route chosen by the team, they can utilize various testing strategies, and collect valuable information in regards to quality and usage - and use it as a guideline for further product improvements. In many cases, however, the alpha stage is limited to developers and employees of the company and the software is only made available for public testing during the beta stage.