Vendors of open source software are benefiting from the economy instead of being hurt by it research firm IDC has found, as corporations are showing increased levels of acceptance.
The Framingham, Mass-based research firm reported this week that worldwide revenues from open source software are expected to grow at a 22.4% compound annual growth rate to reach $8.1 billion by 2013. Michael Fauscette, IDC group vice president of software business solutions, says the forecast is considerably higher than a previous forecast from 2008.
"The open source software (OSS) market has seen a strong boost from the current economic crisis," Fauscette said in releasing the survey. "OSS is increasingly part of the enterprise software strategy of leading businesses and is seeing mainstream adoptions at a strong pace."
The rosy picture for opens source software appears to be in direct contrast to financial results posted recently by the big three enterprise software vendors, SAP, Oracle and Microsoft. SAP reported a 9.8% decline in quarterly revenue, Oracle a 5.2% decline, and Microsoft saw its revenues plummet 17% in the most recent quarter.
Fauscette says in addition to higher corporate acceptance of open source and the effects of the economic downturn, the survey also took into account a wider range of projects used to calculate the revenue forecast. Additional findings from the survey include:
Large software vendors like IBM, Sun, Dell, HP, and Oracle are making significant amounts of indirect revenue from their activities in support of open source software. This, in turn, is aiding mainstream adoption and acceptance of OSS.
The opportunity to leverage OSS in ways that increase competitive advantage, such as part of business process outsourcing applications, is on the rise and should increase adoption and growth.
Rapid industry consolidation will make it critical for OSS vendors to reach scale if they plan to continue as standalone businesses.
The IDC survey was welcomed by members of the open source community. In his blog, Jim Zemlin, executive director of the Linux Foundation, said it's too bad it took an economic crisis to clarify people's thinking in regards to open source.
"The IDC report underscores the fact that open source provides real value for the money and it took a recession for people to figure that out," he said. "For a world addicted to high-priced proprietary software this may have been the bottom that will transition the enterprise IT industry to one of shared innovation, true value for the money, and higher levels of service."
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