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[ossig] Open Source Software Making Inroads in Organizations

Open Source Software Making Inroads in Organizations
December 22, 2005  By News Staff 

Open source software has gone far beyond the Linux operating system, and is
found in all parts of the technology infrastructures of most U.S.
organizations (both corporate and government) and has resulted in cost
savings for companies of all sizes, a research study led by Optaros Inc.
found. Emboldened by cost savings and other benefits, these companies expect
to use significantly more open source software over the next five years and
decrease their use of commercial software packages in their organizations.

The study was conducted in August and September 2005 with responses from 512
U.S. companies, government agencies and other organizations. Sampled
companies ranged in size from small organizations with revenue under $50
million to large organizations with revenues over $1 billion. The study
found that the clear majority of organizations (87%) were using open source
systems, software often available for free and built by communities of
software developers. The most frequently-used open source software was the
Linux operating system, the Apache web server, and web browsers, used at
some level by more than 70% of the companies represented by the survey
participants. About half the respondents were using open source database
management systems and application servers in a single business function.

Gaining in popularity were open source business applications software such
as portals and content management systems. Some 42% of the survey
participants had open source portals and content management systems that
supported a single function. Some 16% used open source customer relationship
management systems, a percentage that will double in the next three years.

"The study shows that a substantial number of companies are aggressively
using open source, and increasingly for industrial-strength applications
software," says Stephen Walli, Vice President of Open Source Development
Strategy at Optaros. "The benefits of open source systems -- less-expensive,
more secure, faster to develop the best-fit business solution, and
easier-to-customize software -- are too hard to ignore in a time in which
organizations must balance the demand for IT with budgetary restrictions."

The move to open source software is in part explained by the cost savings
that companies are generating. Organizations with annual revenue of more
than $1 billion saved an average $3.3 million in 2004 from their open source
software. Medium-sized companies (with revenues between $50 million and $1
billion) saved an average $1.1 million, and companies less than $50 million
saved about $500,000. Several survey respondents reported substantial
savings: a technology company cut costs by $20 million, and four companies
(three of them telecommunications firms) each saved $10 million last year.

The study found that once organizations start using open source software,
their usage typically increases. However, the study also found that most
companies were confronted by four primary barriers to achieving even greater
Uncertainties about open source software that often relegate the software to
the IT function

Lack of understanding of licensing and legal issues around open source

Software cost allocation policies that discourage business functions from
reducing the cost of commercial software

The difficulty of identifying, evaluating, purchasing and maintaining open
source software
The survey was conducted with InformationWeek magazine.

Optaros Inc. is a consulting and systems integration firm that helps large
enterprises use open source software and global sourcing to reduce the cost
of commercial software and rapidly build business applications.

Fouad Riaz Bajwa
General Secretary
FOSSFP: Free & Open Source Software Foundation of Pakistan R
Cell #: 92-333-4661290
e-mail: bajwa@fossfp.org
URL: www.fossfp.org
URL: www.ubuntu-pk.org
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