Open-source firms have boosted their sales during the first part of the year, by and large because companies all over the globe need to cut costs. Don’t get me wrong; the decision taken by many companies to move in this direction was only a matter of time. Companies were dipping the foot in the pool for so long, when it comes to Open-source such as Red Hat and Apache, but finally they took the dive. It was a matter of time because they had been considering it for a while, the urgent necessity to reduce costs only sped things up. Let’s explain the reasons for this “bold” statement.
The GNU GPL licensed SW once referred as “cancer” back in 2001 by today’s Microsoft CEO Steve Ballmer, has proven all the forecasts wrong.
The model of sharing SW + source code and charging for the support and proprietary plugins & apps has shown an important increase in sales since last year in comparison to “The Big Ones”. Let’s analyze some figures for 2008’s Q4: Red Hat reported a 18% growth in sales (http://tinyurl.com/oyjnr5) while Oracle reported that their sales decreased 5% and quarterly income went down by 7% (http://tinyurl.com/q7z358). We can now catch a glimpse of why Sun Microsystem bought MySQL and later on Oracle bought Sun, but that can be discussed in detailed in later posts.
The following list of reasons for using Open-source as well as the order of importance, was determined by a survey of 1,000 US and European IT Executives (http://tinyurl.com/afktdt):
- Ease of use, implementation and administration
- Performance
- Independence of vendors/providers for support, improvements, and new developments
- It is free and the TCO is reduced considerably
- Connectivity with different platforms
This clearly states that even though the company’s decision for moving to open source was triggered by the need of cutting costs, that was not the key factor to switch at all. This should really keep “The Big Ones” wondering…