10.3 Why Open Source?

There are many reasons why firms choose open source products over commercial alternatives:

Cost—Free alternatives to costly commercial code can be a tremendous motivator, particularly since conventional software often requires customers to pay for every copy used and to pay more for software that runs on increasingly powerful hardware. Big Lots stores lowered costs by as much as ten million dollars by finding viable OSSM. Castelluccio, “Enterprise Open Source Adoption,” Strategic Finance, November 2008. to serve their system needs. Online broker E*TRADE estimates that its switch to open source helped save over thirteen million dollars a year.R. King, “Cost-Conscious Companies Turn to Open-Source Software,” BusinessWeek, December 1, 2008. And Amazon claimed in SEC filings that the switch to open source was a key contributor to nearly twenty million dollars in tech savings.S. Shankland, M. Kane, and R. Lemos, “How Linux Saved Amazon Millions,” CNET, October 30, 2001. Firms like TiVo, which use OSS in their own products, eliminate a cost spent either developing their own operating system or licensing similar software from a vendor like Microsoft.

Reliability—There’s a saying in the open source community, “Given enough eyeballs, all bugs are shallow.”E. Raymond, The Cathedral and the Bazaar: Musings on Linux and Open Source by an Accidental Revolutionary (Sebastopol, CA: O’Reilly, 1999). What this means is that the more people who look at a program’s code, the greater the likelihood that an error will be caught and corrected. The open source community harnesses the power of legions of geeks who are constantly trawling OSS products, looking to squash bugs and improve product quality. And studies have shown that the quality of popular OSS products outperforms proprietary commercial competitors.J. Ljungberg, “Open Source Movements as a Model for Organizing,” European Journal of Information Systems 9, no. 4 (December 2000): 208–16. In one study, Carnegie Mellon University’s Cylab estimated the quality of Linux code to be less buggy than commercial alternatives by a factor of two hundred!M. Castelluccio, “Enterprise Open Source Adoption,” Strategic Finance, November 2008.

Security—OSS advocates also argue that by allowing “many eyes” to examine the code, the security vulnerabilities of open source products come to light more quickly and can be addressed with greater speed and reliability.D. Wheeler, Secure Programming for Linux and Unix, 2003, http://www.dwheeler.com/secure-programs/Secure-Programs-HOWTO/index.html. High profile hacking contests have frequently demonstrated the strength of OSS products. In one well-publicized 2008 event, laptops running Windows and Macintosh were both hacked (the latter in just two minutes), while a laptop running Linux remained uncompromised.R. McMillan, “Gone in Two Minutes,” InfoWorld, March 27, 2008. Government agencies and the military often appreciate the opportunity to scrutinize open source efforts to verify system integrity (a particularly sensitive issue among foreign governments leery of legislation like the USA PATRIOT Act of 2001).S. Lohr, “Microsoft to Give Governments Access to Code,” New York Times, January 15, 2003. Many OSS vendors offer “security focusedAlso known as ”hardened.” Term used to describe technology products that contain particularly strong security features.” (sometimes called “hardened”) versions of their products. These can include systems that monitor the integrity of an OSS distribution, checking file size and other indicators to be sure that code has not been modified and redistributed by bad guys who’ve added a back door, malicious routines, or other vulnerabilities.

Scalability—Many major OSS efforts can run on everything from cheap commodity hardware to high-end supercomputing. ScalabilityAbility to either handle increasing workloads or to be easily expanded to manage workload increases. In a software context, systems that aren’t scalable often require significant rewrites or the purchase or development of entirely new systems. allows a firm to scale from startup to blue chip without having to significantly rewrite their code, potentially saving big on software development costs. Not only can many forms of OSS be migrated to more powerful hardware, packages like Linux have also been optimized to balance a server’s workload among a large number of machines working in tandem. Brokerage firm E*TRADE claims that usage spikes following 2008 U.S. Federal Reserve moves flooded the firm’s systems, creating the highest utilization levels in five years. But E*TRADE credits its scalable open source systems for maintaining performance while competitors’ systems struggled.R. King, “Cost-Conscious Companies Turn to Open-Source Software,” BusinessWeek, December 1, 2008.

Agility and Time to Market—Vendors who use OSS as part of product offerings may be able to skip whole segments of the software development process, allowing new products to reach the market faster than if the entire software system had to be developed from scratch, in-house. Motorola has claimed that customizing products built on OSS has helped speed time-to-market for the firm’s mobile phones, while the team behind the Zimbra e-mail and calendar effort built their first product in just a few months by using some forty blocks of free code.R. Guth, “Virtual Piecework: Trolling the Web for Free Labor, Software Upstarts Are a New Force,” Wall Street Journal, November 13, 2006.