Greatest Open Source Presence and Impact: Behind the Scenes

What Is Happening?  Saugatuck research shows two apparently opposing user enterprise executive aspects of open source adoption. First, frequent surveys and interviews with user organizations show Open Source as a "Top Ten" information technology when it comes to investment and expected impact on enterprise business over through the next few years. But that ranking is relatively low. In our most recent large worldwide survey of user IT executives, "Open Source Software" ranked eighth overall, just ahead of Wi-Fi and behind Speech Recognition.

Figure 1: Ten Most Impactful Technologies by 2011

Source: Saugatuck Technology Inc.; n = 230 IT executives

Why is it Happening?  To supplement our established base of user enterprise executive research, Saugatuck researchers have been spending much of the past few weeks interviewing top providers of open source software. Interviewees to date have ranged from SaaS platform provider OpSource, to Linux leader Red Hat, to traditional systems vendor Unisys. The results of this current research wave will help form the basis of our July 2007 market survey on open source adoption, drivers, vendors, and business value.

In every case, the vendor interviewees have responded similarly when it comes to questions about the seemingly low importance or impact of open source-based software on user enterprises. The recurring response is that open source software is much more likely to be found as components within a broad range of software, including SOA (including ESBs and X-ESBs), middleware, development toolsets, applications, and Software-as-a-service (SaaS).  In fact, open source permeates many of the more "impactful" technologies ranked highly in Figure 1 above -- especially web services, SOA, SaaS and VOIP, which are already highly dependent upon open source-based software.

But, when enterprise business executives think of "software," they tend to think of stand-alone instances, such as business applications; surprisingly, relatively few non-IT executives consider operating systems to be "software."  Interestingly, several vendors have told Saugatuck that a growing number of their IT executive customers no longer consider such commercially-packaged offerings as RedHat Linux as open source, due to the commercial nature of the offering and a cost structure that is seen as comparable to Microsoft.

Market Impact:  Based on our user and vendor research to date, Saugatuck hypothesizes that open source will dramatically move up the ranks of the most impactful technologies within user enterprises over the next two years . Open source will enable (and force) improvements in enterprise IT acquisition, standardization, and deployment. It will enable broader and faster deployment of SOA, and enable faster and less-expensive SaaS usage (and SaaS offerings by vendors). But the greatest presence of open source software will be hidden from view -- as components within commercial applications, databases, middleware, and SaaS. The consensus thus far is that "pure" open source applications will provide a very small percentage of enterprise IT by 2011.

Saugatuck plans to test these hypotheses regarding open source adoption and dissemination within various forms of software as part of our upcoming web survey in July. As part of that work, we are building an adoption framework that profiles and predicts growth and change in different types of open source-based software, including operating systems, packaged / purchased applications, SaaS, and middleware. This framework will be further examined and described in future Saugatuck research.

Saugatuck expects that open source components -- specifically components enabling the use of standardized APIs, data formats, and other technologies -- will be a key differentiator for software and SaaS vendors. Proprietary (or, what some vendors refer to as "private source") technologies will not disappear. Most vendors and developers will always want to be compensated for their intellectual property. So we will continue to see vendor-specific applications, operating systems and databases. But open source will be woven throughout the fabric of these, and will be a key component of middleware as well.

The author invites your comments and inquiries on this Research Alert. Please contact Bruce Guptill at bruce.guptill@saugatech.com . For a PDF Version of this Research Alert please Click Here (Site Registration Required)