Panel: Weakening Economy Good for Open Source

By Peter Galli  |  Posted 2008-03-25

Panel: Weakening Economy Good for Open Source

SAN FRANCISCO-Experience has shown a weakening U.S. economy would be good for open source, as a shortage of cash is usually a major catalyst for innovation, particularly around open-source applications, Mark Shuttleworth, the founder of Ubuntu Linux, said at the annual Open Source Business Conference here March 25.

Roger Burkhardt, president and CEO of open-source database firm Ingres, agreed, noting that as the economy slows, budgets tighten and people have to do more with less.  Also concurring was Zak Olaf, vice president of products at MySQL, who said the lower cost of open source is part of its appeal in an economic climate such as the current one.

They were all speaking on a panel titled "The Future of Open Source: Exploring the Investments, Innovations, Applications, Opportunities and Threats."  They were also responding to the findings of North Bridge Venture Partners' annual "Future of Open Source" survey, which found that 81 percent of respondents thought economic turbulence is good for open source.

The survey also found that lower acquisition and maintenance costs, access to libraries of code, and freedom from vendor lock-in are the factors that make open-source software most attractive. 

"We are also now at the tipping point, where people are actually starting to examine at what point and for what reasons they would now use proprietary software. They are now looking for reasons to justify using proprietary solutions rather than open-source ones," Shuttleworth said.

What can open source learn from Microsoft? Find out here. 

The survey respondents also believe that in five years between 25 percent and 50 percent of purchased software will be open source, and that another open-source company with the stature of Red Hat will emerge in two years.

With regard to who will command the majority of commercial non-consulting open-source revenue in 2012, some 35 percent of respondents said platform vendors such as Oracle, Sun and SAP; just over 20 percent said it will be conglomerates like Google, Microsoft and Yahoo; 18 percent said consortia working together on interoperability; and 15 percent said pure platform plays such as Red Hat.

Software as a service will have the greatest impact on software delivery and/or business models for operating system applications and middleware vendors, some 50 percent of respondents believe, with about 25 percent saying this will be virtualized infrastructure, more than 15 percent believing it will be cloud computing, and less than 10 percent giving software appliances the nod.

Most Vulnerable Sectors


The survey also found that Web publishing content management, social software and business intelligence are expected to be the most vulnerable sectors to open-source disruption in the next five years, while configuration management, enterprise portals and security tools are likely to be the least vulnerable.

In addition, security tools, business intelligence and enterprise service businesses are expected to never be vulnerable to disruption.

Linux will be pervasive on future systems and devices going forward and, as more activity happens in the cloud, that will also be built largely on Linux, Shuttleworth said, adding that he does not know which companies will be leading that charge.

Open-source companies will also have to go well beyond just supporting the code they provide, with richer services. "Oracle, Sun, IBM and SAP all face real challenges in shifting to providing data-driven, transaction-oriented services. I don't see them creating the most value on this front going forward," he said.

Asked how many of their open-source project contributors are full-time staff versus contributors, Shuttleworth said some 10 percent are paid by Canonical, but that rises to about a third for the development of core kernel features.

Ingres' Burkhardt said that some 98 percent of the core database work is done in-house, while Jeff Whatcott, vice president of marketing at Acquia, said about 3 percent of contributors for its commercially supported Drupal come from in-house, with the rest coming from the 900 contributors.

John Roberts, CEO for SugarCRM, said his company has had more than 10,000 external developers working on its projects over the years.

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