BANGALORE: Today, the software industry is characterized by an ever-changing mix of excitement, caution, hype, confusion, experimentation, failure and success,thanks to open source software (OSS).

OSS is fast emerging as a phenomenon in the software industry triggering a fundamental shift in how software is developed and distributed. It is touching the very core of the software industry and opening up a new avenue for the software companies to make money.

The open source software movement has significantly upped the ante for commercial players. Companies now must compete based on their business models in addition to other traditional forms of competition.  As the open source movement expands up the software stack, nearly all software markets are now being impacted in some way.
 
According to an IDC study, the open source software phenomenon is spreading far beyond Linux and is gaining enormous momentum. The study, which analyzed IDC surveys from over 5,000 developers in 116 countries and representing 38 developer networks, found that developers worldwide have started using open source extensively. It is being adopted by 71percent of the developers in the world and is in production at 54percent of their organizations. In addition, half of the global developers claim that the use of open source is increasing in their organizations.

The study declares that open source software represents the most significant, all-encompassing and long-term trend that the software industry has seen since the early 1980s. IDC believes that open source will eventually play a role in the life-cycle of every major software category, and will fundamentally change the value proposition of packaged software for customers.

"The use of open source beyond Linux is pervasive, used by almost three-quarters of organizations and spanning hundreds of thousands of projects," according to Dr. Anthony Picardi, senior vice president of Global Software Research at IDC.
"Although open source will significantly reduce the industry opportunity over the next ten years, the real impact of open source is to sustain innovations in mature software markets, thus extending the useful life of software assets and saving customers' money", he adds. 

IDC's findings on developments in the open source phenomenon:

• Over the next ten years, open source will extract a toll on the industry in the low double digits, percentage wise, led by vicious price competition;
• Price effects are a less important impact of open source adoption than the effect of open source on the entire life-cycle of software invention and innovation;
• Despite the proliferation of open source license forms, only three business models are important from an industry's and an individual vendor's success point of view-the software revenue model, the public collective model, and the service broker model;
• Competitive success among vendors' open source markets will be determined by a different set of core competencies than those required to invent and market a new product.

Picardi says, "As business requirements shift from acquiring new customers to sustaining existing ones, the competitive landscape will move towards costs savings and serving up sustaining innovations to savvy customers, along with providing mainstream software to new market segments that are willing to pay only a fraction of conventional software license fees. Open source software is ultimately a resource for sustaining innovators."

The study, Open Source in Global Software: Market Impact, Disruption, and Business Models, explores the growing role of open source among global software developers, and reaches conclusions beyond the hype surrounding the open source phenomenon. The study examines the future impact of open source in the software life-cycle, the emerging business models for open source software markets, and the potential for market disruption.

The study also investigates the open source business models of Microsoft, IBM, Oracle, SAP, SUN Microsystems, CA, AOL, Amazon, and Perot Systems. Essential guidance is also provided, which includes a discussion on "networked intelligence" and the key ingredients of open source sustained innovation business models.

Major Services Players adopt OSS as essential Part of Services Portfolios

According to a IDC study, open source is becoming a fundamental aspect of services portfolios for IBM Global Services, HP Services (HPS), Unisys, Novell, and other major services providers. The study also reveals that open source is moving up on the investment agenda of companies worldwide, as services providers (mostly services arms of technology companies) have formalized support, training, and certification services to encourage adoption of open source (principally Linux) on their products. As open source software goes mainstream, IDC finds that services vendors must further develop open source capabilities in order to meet their clients’ needs and attract new customers.

"There is no longer any doubt that enterprises are trying to take advantage of the quality, flexibility, and license cost savings that open source software offers. However, they have to take into consideration integration, maintenance, and support costs while deploying and managing their open source infrastructure", says Sophie Mayo, director, Emerging Technologies: The Services Opportunity.

Mayo adds, "As the adoption increases, services providers are working to become their clients’ single point of contact for all of their open source initiatives. They are also creating more refined offerings, including preintegrated stacks of open source or mixed-source components, and are supporting them."

CIOL Bureau