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March 12, 2007 | Comments: (0)
The Business Case for Open Source Software
With all the hype regarding Open Source Software (OSS), we sometimes forget logic in the excitement of trying to get on board with this latest trend. What we really care about (or should care about) is making a sound business decision regarding software. Think you should be hopping on the OSS bandwagon just because the software is free? Think again. There's a lot more to making a business decision for OSS than just the up front cost. As the Open Source zealots like to say, "Free as in freedom, not as in beer."
Of course, there are the financial benefits! With an Open Source license which does not restrict your use of the software, you can install as many copies of the software as you want. Since there are no licensing fees, you could install two or two hundred seats with no additional costs beyond the labor required to do so. Without licensing fees, you pay only for hardware and support costs. So not only the upfront costs are lowered, so are the ongoing costs of software ownership.
So what else is there to Open Source Software? Why does my company q!Bang Solutions try to pursuade our clients to use OSS when possible? It's the end of licensing restrictions that tell you how you can use your software. Tired of obtaining license keys from your software vendors every year or even every month just to keep your software running? Feel like your vendor is holding you hostage via your software licensing? With OSS, you never have to enter another annoying license code ever again. They just don't exist in the world of OSS. You don't even have to keep track of silly license validity seals or your purchasing paperwork to prove ownership. Never again will you fear the BSA (Business Software Alliance, not the Boy Scouts!) knocking on your door wanting to perform a software audit. The BSA even takes out advertisements on Google search pages for and up to $200,000 reward a disgruntled ex-employee can receive for reporting your company to the BSA! That's quite a powerful motivator.
My favorite benefit of Open Source Software is one that most people don't even think about. What happens if something happens to the software vendor? What if the vendor gets bought by its big competitor and that new owner wants nothing to do with supporting you? What if the vendor is affected by a natural disaster in some other part of the country (or world) and can no longer function? A perfect example is a small auto insurance company that we recently did some work for. They use a custom CRM application that is designed for small independent auto insurance companies. It's a special application that nobody has the source code for other than the vendor, whose technical division is located in Alabama. Our client has to get a license key from the vendor each month and enter that into the program, or else it will stop functioning. So what happens if a tornado rips through the vendor's offices? That horrible tragedy would put a huge burden on our client the insurance company. The insurance company would not be able to use their custom application which has all their customer data including payment information. They could pay an IT consultant big money to extract their data and import it into another program. For the money that it would cost them to save their data, they could just hire us to write a new OSS application that performs all the same functions as their proprietary one.
Or how about the vendors who just abandon a not-very-successful software product? It's not good business, but it happens. Maybe the software is not profitable and requires a lot of resources to maintain, so the vendor just stops development and no longer supports the software. Of course, that software vendor thinks about all the money that it spent in developing and supporting that software, so they feel that it's theirs and nobody else should get it for free. So instead of releasing the software and its code to the public, the software just dies off because the vendor couldn't let go of something it had spent its money on. And now your company is stuck with no support, no updates, no new features, and no bug fixes. Maybe you're even stuck with non-functioning software like in my example of the auto insurance company. Open Source Software does not die because the developers stop working on it. The software is still available for download so anybody can make new features or fix bugs and security problems. Nobody is left without the software that their company needs to function.
And since this is Open Source Software, you can choose anyone you want to support the software. You might be able to pay the developers for support. You can certainly find a third party to support the software. With OSS, if you are not happy with the support you are getting, you do not have to get rid of the software. You just get rid of the vendor who is providing the support and pay a different vendor for support. Of course, if you find that the software is not doing the job for you and you want to use a different application, go ahead and do so. Open Source Software almost always uses Internet standards for data storage, so it's simple to migrate your data out of one application and into another. The same cannot be said for a lot of proprietary software applications. Just like our auto insurance client above, pulling data out of the proprietary application and getting it into a new application can be quite a time consuming hassle!
I know that we've all been in the situation where you're waiting on a new feature to be released from your proprietary software vendor. They promised it would be available two months ago, and they've been "working around the clock" to finish it, blah, blah, blah... In the world of Open Source Software, if you can't wait on someone else's schedule for a new feature, then you add that feature yourself. What? You don't have programmers on staff? You can always outsource to a programming company and have them do it for you. Even better, you can pay the software project's developers to add the feature. Many OSS developers aren't accustomed to being paid for their efforts, so money can be a great motivator. The point is that you always have some options.
Sure, the cost savings of Open Source Software is a great benefit and a strong reason to choose OSS over proprietary software. However, you now have a few more points to consider as you mull over your software decisions. I hope that I have convinced you that the "freedom" benefits of Open Source Software are just as important as the "free" parts, if not more so.
High Mobley
Co-owner of q!Bang Solutions
February 26, 2007
Posted by Josh Kuo on March 12, 2007 10:53 PM
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Money quote:
For the money that it would cost them to save their data, they could have hired us to write a new OSS application that performs all the same functions as their proprietary one. [...] You can always hire your own programmers and have them do it for you.
OSS is about consultants and corporate IT empire builders uniting to grab a larger slice of the solution budget pie by making clients reinvent the wheel.
Well, I'll agree that consultants want a larger slice of the solutions pie, but we get our slice whether the software is proprietary or Open Source. So I'm not sure how we're using OSS to take advantage of anyone. It's to our long term gain to make sure the client has the best solution possible. If I provided half baked solutions (OSS or proprietary) to my clients, those clients will stop spending money on me and go hire my competition.
The "corporate IT empire builders" can build their empires on either OSS or proprietary software just as easily. So once again I'm not sure how they're using OSS to take advantage of anyone.
And certainly the proprietary software vendors are working towards the same monetary ends as the consultants who advise companies to use OSS. The proprietary software vendors make sales with the corporate IT empire builders just as well as the consultants who advise clients to use OSS.
Posted by: High Mobley at March 13, 2007 08:11 AM"Or how about the vendors who just abandon a not-very-successful software product?"
You mean, like Borland has done to me on 3 different occasions? Despite the (relatively minor) drawbacks of FreePascal and the Lazarus IDE, at least I don't have to worry that support for my development tools can simply evaporate at the whim of the Suits at Borland. They have established a track record of whenever something doesn't sell quite as well as they had hoped, they just drop it and pretend it never existed.
Now, I can just pretend that Borland never happened. The door swings both ways.
Posted by: Howard Lee Harkness at March 14, 2007 09:35 AMSmokin' something illegal? Is THIS article supposed to be about the OSS business case?
"And since this is Open Source Software, you can choose anyone you want to support the software. You might be able to pay the developers for support. You can certainly find a third party to support the software. With OSS, if you are not happy with the support you are getting, you do not have to get rid of the software. You just get rid of the vendor who is providing the support and pay a different vendor for support."
So this means that I can't do that with proprietary software?
What happens to my customized OSS solution if the developer (who wrote the code in a "write-only" OSS dialect that he customized or created) gets hit by a bus? Or if he decides that he wants my business, and decides to starve me out by not serving my needs, or because he "just doesn't like me"?
Or HAS to give all the customizations I paid for to gain busimess advantage over my competition to the "COMMUNITY" because of the OSS license he chooses to release under?
These are all the reasons why one should base their internal application development on COMMERCIALLY SUPPORTED proprietary development environments, with a wide user base. The smart business will own all their code completely (no renting and no COMMUNITY ownership at all) and without exception rely only on standard SQL database syntax and well-documented uncustomized operating system APIs.
Posted by: Patrick C. at March 14, 2007 11:20 AMPatrick C. is either a shill/troll or commenting with extreme ignorance.
"What happens to my customized OSS solution if the developer (who wrote the code in a "write-only" OSS dialect that he customized or created) ..."
Then you have just purchased closed source, proprietary software. As such this demonstrates a disadvantage of the proprietary not the free model. Much proprietary software is produced using Free tools, e.g. the ubiquitous GNU compilers and editors. Most internet protocol stacks (including Microsoft's) use the OSS BSD code.
"Or HAS to give all the customizations I paid for to gain busimess advantage over my competition to the "COMMUNITY" because of the OSS license he chooses to release under?"
The you should have insisted on the "real thing", i.e. the GPL, and not some ersatz "open" licence such as Microsoft's. With the GPL modifications (derived works) belong to th author and/or commissioner (copyright holder) and do not have to be released to third parties. The restriction is that if the derivative code is released outside your organisation (e.g. sold) then it must be under the same licence and the code must be provided. I.e. you can use Free code any way you want, but if you distribute it you cannot change the original authors copyright and licence.
"The smart business will own all their code completely (no renting and no COMMUNITY ownership at all) and without exception rely only on standard SQL database syntax and well-documented uncustomized operating system APIs"
I totally agree (unless you are in the software development business) and this is exactly what you get as a member of the Free software community.
Posted by: rayH at March 15, 2007 08:52 PM>> "And since this is Open Source Software, you can choose anyone you want to support the software. You might be able to pay the developers for support. You can certainly find a third party to support the software. With OSS, if you are not happy with the support you are getting, you do not have to get rid of the software. You just get rid of the vendor who is providing the support and pay a different vendor for support."
>> So this means that I can't do that with proprietary software?
That's right. You can't get a third party to support code that they don't have. Closed proprietary software can only be supported properly by the party having the source. With Open proprietary software (ie, most open source software, including GPL software, but specifically excluding Microsoft's shared source, and obviously excluding public domain software), though someone owns the code, anyone can look at it and make changes with virtually no restrictions on usage. Microsoft's shared source is very restrictive (basically a one-way street where you can help Microsoft all you want and Microsoft can help Microsoft all it wants). Public domains software is not proprietary, unlike GPL software were someone always owns the code (but it is licensed extremely generously).
>> What happens to my customized OSS solution if the developer (who wrote the code in a "write-only" OSS dialect that he customized or created) gets hit by a bus? Or if he decides that he wants my business, and decides to starve me out by not serving my needs, or because he "just doesn't like me"?
This is a problem for closed source, not for open source. This is a classic argument against closed source software and in favor of open source software because these dangers are real with closed source and not with open source.
>> These are all the reasons why one should base their internal application development on COMMERCIALLY SUPPORTED proprietary development environments, with a wide user base.
Open source has potentially the widest possible user base.
>> The smart business will own all their code completely (no renting ..)....
Open source is liberally licensed. If you want to call this renting, then there is never a rent to pay (maybe a one time small fee), you can sublease or invite as many guests over as you like, usually you can never get kicked out (the GPL does allow you to be evicted if you decide to sublease the unit and then procede to abuse your subtenants), etc. See http://www.opensource.org/ http://www.gnu.org/copyleft/gpl.html
Many times proprietary software is "rented." That is what the article was talking about when it said that the "tenant" may need to buy a key monthly to keep the software functioning. Microsoft's software is probably also "rented" by virtually all their customers (there may be exceptions). In fact, most software is rented unless you buy the copyrights or unless it happens to be in the public domain.
You most definitely better be trolling for your sake.
Patrick, Patrick, Patrick! Volumes can be written on how idiotic your arguments were. But lets just cut to the chase. You argue:
1) What if my developer walks with all his customizations.
Then you must be the stupidest businessman on earth. You pay for the code, it should be yours by contract. I can not think of any contract I have ever signed as a contract programmer that did not give all rights to the code to the person paying the bill. Any businessman should insist on this. If they don't their business will crash in a business version of Darwinism.
2) You comment on code that needs to be released as part of the GPL.
Here at my current position, we struggle with this all the time. While the rewards of OSS are great, there is a competitive reality. But once again, your thinking is far too linear. I need to contribute changes to the OSS package, not the entire application. For example: I build a package based upon secure tunnels, and decide to use openssh as a basis of this. But openssh lacks some feature I need. I make the change to openssh, and contribute that back, but my application (which simply uses the GPL library) is a separate derived work, and is not subject to GPL unless we decide to release it as such. Much of the QT and GTK software is developed under this exact same situation.
3) Finally, you rail about how you should own your software.
By this I assume you refuse to use any Microsoft software. No? But you do not own Exchange or SQL Server or even Oracle for that matter. What do you suppose give Microsoft the right to send BSA after you? They are not a police agency. They have no legal right to enter your premises without your permission. The reality is that they have your permission, or did you not read the EULA. Because if you had read it, you would know that you do not own the software, you own the right to use it on one machine. You also by installing the software, agree that Microsoft may inspect your machines to guarantee compliance (i.e. BSA). You give them that permission. I suggest you fully reread all those EULAs of all that Microsoft software you were touting before you open your mouth on this subject again. Maybe if you do, you have a chance of actually sounding as intelligent as you think you are.
Posted by: Kevin Fries at March 19, 2007 06:21 AMI hate the IBM page peel advertisement on this page.
It makes me not want to buy IBM products.
Posted by: Alexi at March 19, 2007 07:29 AMGreat job guys in brigning light to sir "Patrick C. at March 14, 2007 11:20 AM "
The're so many of them out there it's hilarious!!!
;-)
Posted by: Jeunium at March 19, 2007 07:50 AMMy opinion has been that a consultant's job is to weigh the options for their customer and suggest the appropriate technology. Total Cost of Ownership needs to include lots of factors, not the least of which is the HUGE cost of a warm body that is clueful on the technology, or the cost of spinning your existing warm bodies up on the new solution. This is why so many VERY stable financial applications are still on mainframes and Cobol...while we all cringe, it's stable, and tested....it also gives the financial folks time to migrate gracefully instead of paying through the nose for emergency conversions.
I had a very nice compliment from Warren Togami of Fedora fame...(he's also an ex-student of mine and Fedora was originally housed out of ANCL) that I didn't care whether it was Microsoft or Open Source, I just cared whether it was appropriate for the situation...
A perfect example is how quite a few embedded devices are using DOS on an 8-bit CPU. Definately not sexy, but super small and stable for that environment.
/brian chee
Posted by: Brian Chee at March 19, 2007 09:47 AMThe "business case" is mostly irrelevant - because "business cases" really don't exist, any more than than any other "justification" for some action desired exists - outside of the scientific community anyway where evidence is considered necessary to believe something.
The reality is that management does what it wants. Did Enron make a "business case" for looting California? Sure!
The reality is that most management can't reason logically, so trying to convince them that OSS is superior to proprietary software is a waste of time. It requires too many abstract concepts to understand the benefits. Abstract concepts tend not to translate well into a "business case."
The reality is that OSS will come in with new startups who can't afford commercial software. These startups will someday replace the aging dinosaurs in their field - and that's when OSS will be realized. Look at the Craigslist "gigs" section - plenty of startups wanting Linux and OSS gurus to develop their infrastructure.
In the meantime, everyone praise Microsoft for speeding up that process as even the dinosaurs are refusing to install Vista any time soon, fed up with Microsoft's pathetic reliability and security issues while paying through the nose for it.
Posted by: Richard Steven Hack at March 19, 2007 12:27 PMOCC is a fine idea. not let me debunk it a bit...
1. People are greedy. OCC can be exploited. A nice "you never have to pay for licence fees" buy line can sour into a "you will never find anyonce else with the skills to support it, What your business needs it now, its an imbedded tool?, Gosh!!" punch line.
2. People are greedy. Take 'Mambo', really nice OCC website content creation tool deved by the community of dedicated peeps (one worked for me) without delving into detail (mayhapes causing a lawsuit that would cripple me), the project forked and a desision was forced on my business that i dident care about but had huge ramifications on my operations (stupid communities).
3. people are greedy. OCC skill sets are rare (good ones) most if not all command high prices (no dought for quality work) but i could work up a $ case that would show OCC costing much more than off the shelf apps. and the good news is with BPML ect these off the shelfers are more and more flexable. So my highly paid BAs can earn thier keep.
I love the sentiment chaps, but its just anouther business model used by software vendors. the benifits (which should always be measured in $) to the customer are not that great and sadly vendor flexability reduces as commitment to customsied versions increases.
Why go for OCC when BMPL will achive what your looking for.
Posted by: Simon at March 19, 2007 05:11 PMNobody in their right mind would suggest that Free Software is the answer to every business need. As Brian Chee points out, there are many factors that go into a software choice decision and all these factors should be taken into account regardless of whether or not the software in question is Free Software.
Having said that, it is much cheaper to do due-diligence with Free Software because of the transparent nature of the market. The product itself can be evaluated and tested to whatever degree desired for as long as desired, and evaluation can commence in the time it takes to do a download. Examination of the code repository will reveal how many active developers there are, how easy it would be to obtain a warm body who's clueful, and whether or not the code can be compiled without the aid of a discarded potato peeler from 1930. Likewise, perusal of the project's mailing list and download stats will reveal the size, involvement, and satisfaction of the user base. And so forth. The Free Software user does not need to trust the vendor and the "friction" surrounding the evaluation process is minimal. All of this reduces cost, decreases risk, and helps assure that the choice made will be both informed and satisfactory.
Posted by: Karl O. Pinc at March 20, 2007 05:28 AMKevin - right on, and great to point out (and I think it needs more attention) that folks who agree to the MS EULA never really _own_ their software. There is a lot of misconception between copyright (what protects you legally) and licensing (how you'd like people use your stuff) - folks often misunderstand (or simply don't know) what the terms mean and how they apply to software. The FSF, if nothing else, has always been a decent educator on these topics.
I'm 99% a 'right fit solution' person, and usually not partial to OSS or Prop software, either way. But most businesses would be remiss not to at least explore the OSS world as part of any diligence in researching a solution.
Posted by: JMac at March 22, 2007 02:12 PMThere's still what I call the sunshine effect -- the good guys can act overtly, the bad guys must act covertly. Everyone -- good guy or bad -- has an interest in seeing that their own systems are secure. Hacks will happen, but both alerts and fixes will be communicated rapidly. While crackers operate behind pseudonyms, anonymous remailers, owned systems, and IRC, legitimate operators can communicate openly and to authoritative information channels (e.g.: CERT).
Evil has got a new face! And it’s clawing into your system.
There is a number of software programs distributed by private companies to accumulate statistical data that's projected to help them in their advertising. Business promotion and sales efforts are on the prowl. That's petite console to those whose systems have been assaulted against their notion. Remember the instance when your computer become so slow that you can move around the house doing all the bits and pieces, which were not intended at that moment, in the time it takes your word processor to open? There’s a good chance you don’t have to blame it on Rio, better blame it on Spyware.
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