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CFOs start to see the benefits of open source

CFO Magazine is running a great story about the cost savings available from open-source software. This is a topic that you'll hear open-source vendors crow about, but it's somewhat rare to actually get a CFO on the record about her benefits from open source, so it's notable.

Recent Gartner research suggests that over 27 percent of enterprises will deploy open-source software in 2009. (Note: the remaining 63 percent will, too, but Gartner must have asked the CIO, and the CIO is the last to know.) That's up from 25 percent in 2008, while the share of … Read more

Open-source integration: No vendors required

Over the Christmas break, I've watched one of the basic powers of open source in action. Two employees from my Alfresco team did something that is largely impossible in the proprietary world:

They wrote integrations to third-party open-source software, the Apache Hadoop and Drupal projects. No contracts changed hands. No NDAs. Just code.

Open source, of course, is a great way to get one's code in the hands of would-be customers, and then sell them support or other add-on services or software. But it's also a fantastic way to collaborate with would-be partners. Not a single lawyer … Read more

Mozilla's mobile browser gets closer to prime time

Years ago, Mozilla introduced its mobile equivalent of Firefox, then-called Minimo. Minimo unfortunately largely died of boredom within Mozilla. In early 2008, however, Mozilla resurrected Minimo as Fennec, and the heavens rejoiced (though even the heavens couldn't get it installed on [Name your mobile device of choice]).

As recently announced by Mozilla, however, Fennec just hit its second alpha release, with the option to download and install the mobile browser on Mac, Linux, and Windows desktops for testing purposes. (If you want to install it on your mobile device, you're going to need to have a Nokia N810 … Read more

Community beyond open source: Mac vs. Windows

I came across an interesting question on TechFlash today: is the Mac or Windows community stronger?

This topic is particularly interesting to me as in the open-source world we fetish "community" like deity, but also somehow believe that open source has a lock on community. The very fact that TechFlash can ask the question with a straight face suggests that open source may not be the sole repository of communal thinking.

Indeed, one could argue that Microsoft owes much of its success to a strong emphasis on its partner and user communities over the past few decades. Apple … Read more

Google displaces Red Hat as CIOs' first choice for value

For the first time in years, Red Hat didn't take first place in CIO Insight's annual Vendor Value Survey. That honor goes to Google. Though Red Hat registers a close second, Google's practice of freely giving away much of its software saw it rise above Red Hat, which took second place in a survey that it has dominated in the past.

Two security firms - RSA Security and Check Point Software - took first and third place overall, with Google, Cisco, and Dell claiming second, fourth, and fifth places, respectively. Red Hat claimed the seventh spot in … Read more

MIT open-sources mobile code

Red Hat CEO Jim Whitehurst has been talking for the past year about how a vast, largely unexplored repository of great software is the enterprise, and how much value could be unlocked by open-sourcing it.

Open source creates better software, Whitehurst argues, so why not expand its value by expanding its community?

The Massachusetts Institute of Technology apparently has heard the call, opting to open-source its Mobile Web project, as reported by ReadWriteWeb. The code "offers a staff and student directory, a campus map, the shuttle schedule, an event calendar, class announcements for students, emergency information, and status updates … Read more

Open source is dead. Long live open source

BusinessWeek talks out of both sides of its mouth on Monday, on one hand carrying an op-ed piece from Collaborative Software Initiative's Stuart Cohen arguing that the "open-source business model is broken," while on the other hand talking up how enterprises are turning to open source to save money and drive productivity in tough times.

Which is it?

It's both, of course. Cohen is referring to a bit of a straw man when he claims open source is dead, referring to support-based business models that don't add "proprietary" value beyond the base, open-source code. All successful open-source companies have always had some value-add beyond the base code itself, whether that company is Red Hat, MySQL, SugarCRM, Zimbra, or IBM. We've just become more open about calling it out.

Cohen is therefore right to declare:

Open-source code is generally great code, not requiring much support. So open-source companies that rely on support and service alone are not long for this world. The traditional open-source business model that relies solely on support and service revenue streams is failing to meet the expectations of investors.

So we need more efficient ways to monetize open source. Point taken. But customers aren't waiting. As E*Trade Financial Chief Scientist Lee Thompson tells BusinessWeek, the benefits of open source are too good to ignore, and go well beyond acquisition cost:

For some companies, the benefits of open source extend well beyond cost savings, to such areas as license management. "Your engineers spend less time on contract negotiation and more time on the technology, which is really what you want them to be doing," says E*Trade's Thompson.… Read more

Analyst: Red Hat "deeply undervalued," Oracle Linux "has failed"

Red Hat has been taking a beating in the stock market recently, but in a recent research note leading analyst Mark Murphy of Piper Jaffray thinks this represents an exceptional opportunity to buy into a "deeply undervalued" company. More interestingly, Murphy finds significant cause for Red Hat optimism based on Oracle's failed attempt to undermine Red Hat with its Unbreakable Linux product.

If Red Hat's model were fragile, the thinking goes, surely a behemoth like Oracle could make a dent in Red Hat revenues? Oracle got into the Linux game two years ago, hoping to cannibalize Red Hat's business for itself.

As Murphy points out, however, Oracle has completely failed to hurt Red Hat, calling into question the belief that Red Hat's demise is just a fork away. Novell, too, despite starting to build a decent Linux business of its own, as The VAR Guy has noted, has completely failed to touch Red Hat's rising revenue. The reason? Red Hat remains the default choice for enterprises looking to move off expensive Unix to high-performance and low-cost Linux.

Murphy writes:

Oracle has failed in its attempt to enter the Linux market. Our recent survey of Oracle database customers reveals that only 1 out of 32 customers currently uses Oracle Unbreakable Linux. This one customer also commented that "support is terrible, it is difficult to get an answer to my problems, Oracle's agents never understand my company." The survey reflects a very low penetration rate in the 2-year period since Oracle unveiled Unbreakable Linux with much fanfare, including live penguins running around onstage with Larry Ellison. Resellers continue to characterize Unbreakable Linuxas a failure because Oracle ultimately cannot control the future direction of RedHat Enterprise Linux, upon which it is based.

While the Street has expected Unbreakable Linux to severely impact Red Hat, its failure ironically serves as a proof-point of the underlying defensibility of RedHat's business model. In fact, in the two years since Oracle introduced Unbreakable Linux, Red Hat's billings have grown at an average rate of 31%--representing clear market share gains.

When Red Hat's biggest rivals can't hurt it, surely this is cause for optimism, and not a market slide? It turns out that being the "source of code" is a great alternative to owning the source code, at least in Red Hat's case.

Red Hat has shown no signs of slowing, with its subscription model able to weather the current recession: even if it doesn't sell any new subscriptions, it can tread water and/or grow with its existing customer base, something that license-revenue driven companies simply can't afford to do.… Read more

Open source within the firewall

In a recent discussion with enterprise CTOs, I asked why they don't contribute more code back to open-source projects. There were a variety of answers, but one of the biggest sticking points was a preference for avoiding their legal departments.

In an interesting twist, however, Martin Fowler points to a different way to engage in open-source development that is unlikely to cause angst among one's JD-ridden colleagues: intra-company open-source projects.

Think about it. A company like GE employs over 300,000 people, with wide-ranging subsidiaries and departments. A project built by GE Finance might have direct relevance to GE's NBC Universal unit, for example, and greater efficiency can be created by providing open-source development methodologies within large companies. Indeed, this is what Collabnet and other open-source development infrastructure companies have long promised large enterprises.

But it's not just about large enterprises, as Fowler suggests:… Read more

Gartner: 85 percent of enterprises using open source

Admit it. When you read that headline - "Gartner: 85 percent of enterprises using open source" - you assumed that was a good thing, right? Who's afraid of enterprises saving a lot of money and getting much more flexible IT for their IT budgets?

Gartner, apparently. According to Gartner, that widespread adoption is cause for alarm, as Glyn Moody rightly notes (and pillories). Somehow, Gartner assumes that if 85 percent are using open source and 69 percent don't have a formal open-source management team, the world is going to end.

As Moody notes, however, IT organizations have virtually nothing to worry about when adopting open source:

"About a dozen times a year," [Software Freedom Law Center general counsel Eben] Moglen says, "somebody does something [that] violates the GPL. Most of the time, they're doing so inadvertently, they haven't thought through what the requirements are. And I call them up and I say, 'Look, you're violating the GPL. What you need to do is this. Would you help us?'" The answer is invariably yes, he says.

So the reality of the situation is that the worst you are likely to get is quick phone call from Moglen....Here's the truth, then: there are no "huge potential liabilities" involved with free software. It's very hard to infringe, and very easy to sort things out.

I think it's more likely that Gartner's biggest concern is that open-source software firms (and communities) pay it little money for its research. The biggest danger from open source may actually be to Gartner's P&L statement, not to the enterprises that adopt open-source software.

After all, as IT Pro reports, the Gartner study also indicates that open-source software "is being used for mission critical processes as often as it is for less business-necessary functions." In other words, more of the world relies on software that brings Gartner roughly $0.00 in analyst fees.… Read more