[LINK] Open source: 'World's largest software company'

[Bernard Robertson-Dunn]

Open source: 'World's largest software company'
"The ultimate in disruptive technology" is coming up strong
By Matthew Broersma
22 April 2008 15:48 BST
http://software.silicon.com/os/0,39024651,39201838,00.htm

Open source software is successfully displacing proprietary applications 
in many large companies and eating into the annual revenues of 
proprietary software vendors by $60bn per year, according to research.

According to the study from the Standish Group called Trends in Open 
Source, released this week, the losses of proprietary software makers 
are disproportionate to the actual spend on open source software, which 
is a mere six per cent of an estimated worldwide spend of $1tr per year. 
The researchers put this difference down to the fact a large proportion 
of open source isn't paid for - an intended result of the open source 
licensing structure.

Standish Group chairman, Jim Johnson, said in a statement: "Open source 
software is raising havoc throughout the software market. It is the 
ultimate in disruptive technology."

The study, the result of five years of research, states if open source 
products and services were calculated at commercial prices, open source 
as a whole would be equivalent to the largest software company in the 
world, with revenues exceeding the combined income of Microsoft, Oracle 
and Computer Associates.

The open source community's programmer-hours, if added up, would place 
it as the largest software employer in the world, the study said. The 
company found that open source software, once used primarily for 
low-level needs, has moved up the chain. Open source is often brought in 
to cover a project's basic requirements; creating a "baseline". But 
increasingly often, no further proprietary software is needed to fulfil 
more advanced requirements, the report found.

The study states: "In many cases, especially in infrastructure software, 
the baseline is a fully developed and working system. Many applications 
and service components are fully functional and can be used immediately. 
Other applications and components provide a firm baseline around which 
to develop a more elaborate system."

The Standish Group found 11 per cent of all new commercial software 
requirements are satisfied by open source solutions and components. That 
figure doesn't include application service providers (ASPs) that use 
open source to service their clients.

Such findings are a telling insight into the ways open source can be 
seen as a threat by large software companies such as IBM, according to 
Dave Rosenberg, chief executive of open source start-up MuleSource.

Rosenberg told silicon.com sister site, CNET News.com: "IBM is 
threatened by open-source SOA [service-oriented architecture] tools as 
many of them meet the full requirements enterprises look for. This 
baseline notion is interesting as products like JBoss used to be 
considered just for development with BEA for production but over the 
last two years or so that sentiment has changed, with lots of JBoss in 
production."

Original article: Proprietary vendors lose £30bn to open source from 
ZDNet UK
http://news.zdnet.co.uk/software/0,1000000121,39397439,00.htm

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Regards
brd

Bernard Robertson-Dunn
Sydney Australia
brd at iimetro.com.au