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Tuesday, November 23, 2004

The Business Impact Of Open Source Software

The impact of open source on business is slowly getting to be understood where some data is beginning to be made avaiable in place of perceptions and assumptions.IT analyst Salvino Salvaggio sets out to quantify the magnitude of usage of open source software's impact on the financials of companies. After eight months of deep research and analysis, he emerged with a 200-page report called, Open source : a revolution in the software industry. Salvino Salvaggio writes, all of the analytical research protocols for the study point towards two main conclusions:-

A.One, compared to 'closed source' or proprietary software, OSS brings huge IT investment savings, and the total return on investment, or ROI, is highly attractive regardless of the size of the IT infrastructure at the implementing company.

B.OSS users are more empowered, because they do not depend anymore on vendors' strategies. These conclusions might seem obvious but now instead of just assuming they are right, we have crystal-clear evidence to support them!

Salient findings:

- Any software whose code is available for users to look at, modify, reuse and redistribute freely can be called "Open Source Software" (OSS). There are however some differences between OSS and free software regarding mostly users’ duties and intellectual property rules

- The phenomenon of OSS is not new : at the beginning, programmers, not software, were core ; later on, rights of usage became a way to earn money ; however, some programmers called for a return to the public sharing of software ; then Linux came...

- Production of OSS happens according to a self-regulated, decentralized organization that gave OSS development unique opportunities while a new approach of collaborative work improved the sustainability of the project and made it able to impact key economic levers

- Linux hype cycle has been guided, among others, by perception of PROs and CONs. Recently, perceived benefits of OSS seem overtaking barriers and increase its appeal to businesses. As a matter of fact, global comparison highlights real advantage to OSS. It is therefore not a surprise that finding evidences of OSS as a technologically and financially viable solution is becoming quite easy

- Compared to vendors’ closed source software OSS secures huge IT investment savings, and total Return On Investment is highly attractive. Additionally, OSS users are empowered, for they do not depend anymore on vendors’ decisons

- OSS users' satisfaction is likely to foster a viral effect of adoption as evolution of OSS market share also shows
- With OSS, the concept of vendors is disappearing. Shifts in vendors’ revenue streams trigger deep changes in the culture of software business as well as in the industry at large

- Available OSS solutions already meet almost the whole range of companies' needs for any IT segment (core data center, server, office, iamge manipulation, content management system, etc.)

- Migrating to OSS should follow a sharp process : analysis of the pros and cons, analysis of economic efficiency/impact, implementation of the migration itself according to a planned path

- Several real-life cases show migrating to OSS is a winning move from both IT strategy point of view and, especially, business strategy point of view

The analysis looks interesting, but more discussions need to be done. The TCO covering adminstration of the system- factoring downtime costs, learning time costs,costs of education, certification, maintenance of the certifications,upgrades etc. Salvaggio's report is a must read for those looking to make the business case for deploying open source software.
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Sadagopan's Weblog on Emerging Technologies, Trends,Thoughts, Ideas & Cyberworld
"All views expressed are my personal views are not related in any way to my employer"