Free Open Source Software Is Costing Vendors $60 Billion?


Talk about FUD. I came across a release this AM titled, “Free Open Source Software Is Costing Vendors $60 Billion,” New Standish Group International Study Finds”.

This ‘research’ firm claims in its release that they’ve spent 5 years studying the Open Source market (funny since in the last five years I’ve never heard of the Standish Group). After all that ‘research’ they’ve come to a big conclusion and one that is obviously very debatable.

“Open Source software is raising havoc throughout the software market. It is the
ultimate in disruptive technology, and while to it is only 6% of estimated
trillion dollars IT budgeted annually, it represents a real loss of $60 billion
in annual revenues to software companies,” said Jim Johnson, Chairman, The
Standish Group International, Boston, MA in a statement.

Unfortunately I don’t have a full copy of their research, so I’m unable to comment on their methodology. But to make an outlandish statement saying that open source represents such a dramatic loss in revenues is — to say the least – inflammatory.

According to IDC (which in my opinion has perhaps the most accurate stats on the issue so far), $21 billion in revenues came from the Linux ecosystem in 2007 alone. That’s only Linux (and Open Source is more than just Linux) and that’s only 2007.

What would make for an interesting study though, is a full study on how
much open source in total has contributed to growing software revenues
(considering that nearly every major software vendor uses open source
software in some way shape or form). Open Source certainly represents a threat to proprietary closed software vendors, but it also represents an opportunity for them and for the entire software market as a whole. 

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