The Growth of Open Source Software in Organizations
A report by Stephen Walli, Dave Gynn, Bruno von Rotz
19 Dec, 2005, from Optaros Inc. Download the white paper.
This research report is based on survey data collected from an online poll distributed to more than 40,000 information technology and business professionals. The results show that open source software adoption and usage is on the climb in small to large organizations, and that there is clear proof of its cost savings and overall value to IT:
- A clear majority of U.S. companies and government institutions are turning to open source software instead of using commercial software packages. Some 87% of the 512 companies we surveyed are using open source software. Bigger companies are more likely to be open source users: all of the 156 companies with at least $50 million in annual revenue were using open source.
- Companies and government institutions use open source for three primary reasons: to reduce IT costs, deliver systems faster, and make systems more secure.
- Organizations are saving millions of dollars on IT by using open source software. In 2004, open source software saved large companies (with annual revenue of over $1 billion) an average of $3.3 million. Medium-sized companies (between $50 million and $1 billion in annual revenue) saved an average $1.1 million. Firms with revenues under $50 million saved an average $520,000. Asked to categorize all the benefits (cost savings and other) from open source, most companies said they were moderate or major. Some 70% of large firms are seeing moderate or major benefits from open source. Of the companies under $1 billion in revenue, 59% are seeing major benefits.
- Increasingly, after years of using open source software at the lower levels of the “software stack” — i.e., operating systems (e.g., Linux) and Web server software – more and more companies are using open source software for business applications to reduce the substantial costs of commercial versions of such software.
- Despite proving the value of open source software, many companies face tall barriers in cutting costs through open source. Four barriers loom larger than any others: executives lacking knowledge about the benefits of open source and harboring fears about quality and support; legal and licensing issues; corporate cost allocation policies that don´t provide incentives to business functions to reduce the cost of commercial software and thus diminish their interest in open source alternatives; and the difficulty of procuring open source systems that will be supported after installation.
- Once organizations start using open source software, their usage increases. Companies expect their usage of open source software over the next several years to increase dramatically. Organizations also expect to decrease the amount of commercial software they use and increase both open source and custom software initiatives.