This is a short explanation about the original concept of open mic.
An open mic (or open mike) is a live show where audience members may perform at the microphone. Usually, the performers sign up in advance for a time slot with the host or master of ceremonies. These events are typically focused on performance arts like poetry and the spoken word, music, and comedy.
In music, these shows provide an opportunity for musicians to gain experience performing to a live audience without having to go through the process of getting normal music gigs, which is very difficult to do without experience of live performance.
Open mics have been gaining in popularity in recent times, providing a much-needed outlet for singer-songwriters. Prior to their popularity, the only outlet generally were folk clubs, which were not always friendly towards creators of new music, preferring traditional music. They also suggested that music performed by acoustic musicians or solo artists in this manner would necessarily be folk music, a misconception that still commonly exists today. Some organizers have chosen the title "acoustic night" or "acoustic club" in an attempt to indicate an event run broadly on the lines of a folk club, but with a much wider range of musical styles.
Source: http://en.wikipedia.org/wiki/Open_mic