3 Insights from The Linux Foundation’s New Survey on Open Source Economics

The recent Linux report substantiates the growing reliability of open-source solutions.

If you’re an open source proponent—I’m talking true, 100% free and open source project versions—you undoubtedly know the technical and business benefits that an open source strategy can deliver to cloud and data architecture up and down the stack. However…tangible, data-driven evidence to support that conclusion never hurts. That makes “Measuring the Economic Value of Open Source,” the new survey from The Linux Foundation, a must-read.

The extensive survey sought perspectives from 451 technology and business leaders, with more than one-third holding C-suite positions at Fortune 500 companies. The data largely reveals a throughline among these industry heavyweights: open source software leads to a substantial return on investment. While some report being earlier on in their open source journeys than others, the prevailing sentiment is clear: the economic impact of open source is big, and is going to get even bigger.

Here are few of the most important findings from the report:

Open source is a glide path for lasting cost-efficiencies

The majority of surveyed tech leaders—nearly two-thirds—asserted that the advantages their organizations gain from open source software outstrip its costs. A mere one in five indicated that

in their experience, the costs associated with open source surpass the benefits. Observing the evolution of these cost-benefit ratios over the preceding five years, about half the respondents noted a consistent increase in the value they extract from their open source strategies, while a scant 16% reported a decreasing ratio. As more enterprise-tested open source projects mature (and as they continue to cover a broader set of use cases), I expect those numbers to push even more in favor of open source the next time this survey is run.

When prompted to evaluate the direct impact of their open source software, most respondents determined that their open source strategies provide economic value that equals 1-2 times their associated expenses. When weighing the specific pros of open source software, cost savings, accelerated development pace, and open standards and interoperability emerged as primary benefits. Conversely, security vulnerabilities, unforeseen support costs, and legal ambiguities related to licensing were perceived as the most notable challenges of open source. License confusion was perhaps the least surprising of these, as several high-profile (and controversial) open source license changes have popped up in the past couple years.

The cost gap between open source and open core (and proprietary) solutions is growing

For those who have contemplated alternatives to open source software versions, the survey respondents would have considered both commercial-code products (half of the respondents) and in-house solutions (about one-third). However, the prevailing sentiment was that these alternatives carried a much steeper price tag. No real surprise there, of course, but what was interesting here is how skewed it was: Only 13% thought they could purchase or otherwise develop the functionality they needed (including ongoing support and maintenance) for less than the cost of implementing a fully open source version of what they needed.

One part of the survey that took me by surprise, however, was the sheer scale of the projected cost savings brought about by open source technologies. Consider this: about 31% of the technology leaders surveyed believe that if they were to attain the same functionality without using open source software, their costs would multiply by four. Or, put another way: these technology and business leaders (who have undoubtedly run the numbers many times over) would spend four times the amount they currently spend on open source to achieve the same results. Another substantial portion of leaders, about 25%, believe that the costs would at least double if they weren’t using open source. Whether you see it as a 4x increase in cost or a 2x increase, the results here illustrate the financial stakes potential savings that open source—selected, deployed, and scaled effectively—can offer.

Beyond the monetary: getting new applications to market faster

The survey also went beyond the monetary to unearth some interesting open source thinking among technology leaders. It highlighted that the immediate availability of open source software often outweighs the potential financial savings of internal development. Time is certainly of the essence in competitive industries (i.e. all of them), and open source software provides instant access to an ever-increasing array of functionalities. This clearly resonates with many enterprises, as they pointed out that faster development speed was one of the top benefits of using open source software.

Final thoughts

It’s also worth noting that some organizations are still in the early stages of their open source journey. They’re shouldering the initial costs of adoption and may not have yet started to see the benefits. This could account for those participants who believe that the costs of open source currently outweigh its value. I expect the next survey to skew even more in favor of the financial benefits 100% open source technology is delivering to mission-critical enterprise environments.

This report substantiates the increasing reliability of open source as a significant driver of business and technological innovation, even as it sheds light on areas that do require careful attention and management.

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