business of software is changing from providing licenses
that confer a 'right to use' to delivering technology
and services that enable customers to use technology
with greater effectiveness. by Javed Tapia
source is a disruptive technology. Disruptive technologies
change our relationship to the worldhow we travel,
communicate, and work. The railroad was a disruptive
technology to the horse and carriage; the automobile
to the steam engine. Technologies that don't evolve,
We believe the proprietary software development model
is a horse and carriage whose time has come and gone.
The business of software is changing from providing
licenses that confer a 'right to use' to delivering
technology and services that enable customers to use
technology with greater effectiveness. In the past,
too many software packages became 'shelfware' for the
customer, because vendors focused on selling the license.
In the Open Source model the focus is on providing high
value technology and services to customers. Open Source
vendors provide these more effectively because their
technology development model is more scalable and their
business focus is customer service, not technology licensing.
Red Hat software is the distributor of the open-source
Linux operating system. Although in the past few years
there has been considerable hype concerning Linux, we
do think that Linux represents a compelling technology
for use in server and desktop applications. Recently
we have seen a significant up-tick in the enterprise
use of Linux as a server operating system, a result
of server consolidation and Linux's lower total cost
of ownership (TCO).
Linux, the open-source operating system, is now running
on powerful government computer systems, and technology
giants are increasingly providing support. Linux is
also being looked at for large high-end processing applications.
CSFB, a leading investment bank, migrated a large financial
trading application from Unix to Linux to achieve significant
performance enhancements. Linux is running on several
Air Force computers, along with systems run by the Marine
Corps, the Naval Research Laboratory and others.
There are potentially significant benefits to the customers
of Open Source. One of the benefits that open-source
customers derive from the licensing terms of the software
is the ability to access and modify source code. This
can be beneficial to those who need changes made to
Another benefit to customers is a lower TCO partly due
to reduced licensing costs, because open-source software
is generally provided at a low cost. However, another
factor in open-source software's cost is the ability
to run the software on commodity-level hardware. This
helps to reduce costs by allowing customers to work
with numerous hardware vendors to obtain beneficial
pricing. It also allows customers to recycle unused
access unused capacity on existing hardware.
Backed by expert support, Linux is inexpensive and can
be easily customized to meet specific operating needs.
On the enterprise front, Linux remains an ideal choice
for IT Managers, as it allows them to confront their
daily tasks with much greater reliability. Servers running
Linux have been known to run for months, even years
together without needing to reboot. Affordability is
another factor. Even though the initial price of the
Linux software puts it in a class by itself, initial
price isn't the only consideration. Ongoing operational
expenses, licensing fees, and support costs can make
initial costs seem insignificant. The open source code
makes Linux simple to administer; users have no licensing
fees to contend with, and support means getting in touch
with experts, seeking help from the Linux community,
or fixing it on your own through the open source code.
Control comes next. Because Linux resembles Unix, many
administrators find the transition to Linux an easy
and welcome one. With source code in hand, you can modify
the operating systems you deploy for maximum memory
efficiency or individual user preference.
Support is not available in an organized manner. Companies
like Red Hat offer their own support initiatives. Red
Hat Network, is an Internet service for software delivery,
support and management. It's the pipeline that lets
customers tap into real-time open source innovation.
To date it has delivered five million software packages
to more than 300,000 Linux servers. Red Hat business
model revolves around providing consultancy, support
and engineering services to customers on a professional
From the small and medium-sized businesses point of
view, Linux goes hand-in-hand with building a business
and providing a computing solution that grows with the
business, especially in the case of Internet-oriented
organizations that demand speed, flexibility, and reliability.
A new business venture/service provider may want to
put up a company website, or create a corporate intranet,
and the budgets may be tight. The efficiency of Linux
takes care of the same. It also enables the reuse of
old computers as more-than-capable Linux Web, e-mail
and print servers. But that's not all. As the company
grows, Linux proves its flexibility as one can cluster
a number of Linux servers together to create an efficient
A study by WR Hambrecht predicts revenue from the market
for Linux products and services is expected to explode
with a compounded annual growth rate of 90 percent growing
from $2 billion in 2000 to over $12
billion in 2003.
Linux enjoys the support of many of the world's largest
and most powerful computing companies, including Oracle,
IBM, Sun, HP, Silicon Graphics, Veritas, CA, Checkpoint,
Legato, Trend Micro, command and so onall of whom
have contributed significantly to improve Linux.
Linux is increasingly becoming a platform of choice
for ISVs and there is a whole gamut of applications
available on Linux for all purposes.
Open source software is for free. This is a myth which
is very often exploited by the critics of Open Source
to justify that the cost of maintaining an Open Source
system is equal to the cost of licensed software in
the long run. Nothing in life is free and if it is,
then it isn't worth it. Open Source software has a cost
associated with it but despite what its critics may
say, it costs far less to support, maintain and upgrade.
If one vendor charges too much, the customer is free
to select another vendor without any proprietary lock-in.
In this kind of competitive situation,
costs have to be reasonable and market-driven.
Linux has started to become a mainstream operating system
in all sizes of organizations, in all markets, worldwide.
Linux has moved up in the value-chain and crossed the
chasm. It has become a potent environment for some business
critical applications like database, clustering solutions,
ERP, SCM and so on. The reliability, stability and ease
with which the software can be customized, installed
and operated is quite appealing to organizations. The
fact that many application development and deployment,
middleware, server-ware and application products are
freely available on the platform helps as well.
Specifically in the Indian context, enterprises are
warming up to the idea of moving to Open Source technologies.
They have understood the benefits it has to offer and
have decided that they need to have the freedom of choice.
The writer is Director, Red Hat India