Open source's future: More Microsoft, less talent

Open source analyst says systems integrators to play bigger role in 2008 too

The open source industry in 2008 will be marked by more news out of Microsoft, IBM, Oracle and other big IT vendors, less start-up funding, more M&A activity, and an increasingly serious talent shortage.

That's all according to Raven Zachary, open source research director for The 451 Group, which is holding its 2nd Annual Client Conference in Boston this week.

Zachary said during a presentation at the event that overall, he is bullish on the market. His optimism is fueled in part by the fact that the traditional bottom-up adoption of open source by developers and systems management pros in enterprises is being complemented in many cases by top-down adoption driven by CIOs and executive committees sold on the potential cost reductions. What's more, companies are deploying open source not just at the browser and operating system levels, but also across various vertical applications, said Zachary, whose experience in the industry includes once serving as director of Internet technology for La Quinta Inns, where he implemented an open source e-commerce system

The analyst said he is also optimistic because big-name IT vendors known best for their proprietary technologies are embracing open source and collaborative development systems involving ISVs and customers. Open source is "a disruptive force" that has big vendors re-evaluating their business models, licensing schemes and product plans, Zachary said.

He described how active companies like IBM and Oracle have become in open source organizations such as the Eclipse Foundation, how Microsoft has cozied up to Novell and how Sun has finally gone the open source route with Java. He also said he anticipates Microsoft becoming increasingly busy in open source, since it "has a vested interest in making sure open source works well on Windows." However, he noted it could be well into the next decade before we see something as dramatic as an actual Linux distribution from Microsoft. "Microsoft is still trying to work out its strategy," he said. "Ultimately, I think we'll see them embrace open source much more."

The interest by Microsoft and other big companies in open source should fuel more M&A activity in 2008, Zachary said. He said there were 16 deals in 2006 and have been 25 to date in 2007, while funding for new open source companies has plunged (US$513 million for 53 companies in 2006 vs. US$270 million for 39 companies so far this year).

But not all the news for 2008 will be good if the market watcher is correct.

The current shortage of open source talent will only worsen as demand skyrockets for internal open source support and developers, Zachary said. One example of such a shortage will be people with expertise in the open source Java servlet middleware called Tomcat that comes from the Apache Foundation. "There are 25 or so core contributors to that project," Zachary said. "Over the past four or five years that number has stayed virtually identical...but the growth of Tomcat has been astronomical."

Zachary said companies increasingly have been hiring Linux know-it-alls, but he advised them also to focus on identifying which open source projects have big potential and hiring talent early on before the going price gets too high (One audience member cited an example of Ajax developers being offered as much as US$600 to consult, the sort of offer that is drawing them away from contributing to open source projects.)

A silver lining for open source adopters, Zachary said, is that systems integrators such as Unisys and EDS are putting more resources into open source support offerings. That should lessen some of the pressure on IT shops to add open source experts to their staffs, he said.

Also in the bad news department for 2008, Zachary expects we'll see a new wave of failed open source businesses in 2008 as companies gain further understanding of how to monetize open source, or not.

In addition, the 451 Group has just issued a report saying the open source opportunity in the small and midsize business market is limited in that SMBs won't be nearly as willing as larger enterprises to pay for support. In many cases, SMBs will look at open source like they do shareware, Zachary said.

Other tidbits from Zachary's presentation:

  • On the buyout front, look for someone to snap up what remains of SCO Group, which filed for bankruptcy protection earlier this year, and don't be surprised if Oracle makes more deals in the open source database area.
  • Zachary said he expected open source would have a "huge impact" on VoIP this year. "Maybe we got a bit too excited," he said, calling 2007 "more of a growth than a breakout year." However, he did say it's inevitable that open source will have a huge impact on VoIP via Asterisk and other technologies.

Join the PC World newsletter!

Error: Please check your email address.

Our Back to Business guide highlights the best products for you to boost your productivity at home, on the road, at the office, or in the classroom.

Keep up with the latest tech news, reviews and previews by subscribing to the Good Gear Guide newsletter.

Bob Brown

Network World
Show Comments

Essentials

Lexar® JumpDrive® S57 USB 3.0 flash drive

Learn more >

Microsoft L5V-00027 Sculpt Ergonomic Keyboard Desktop

Learn more >

Mobile

Lexar® JumpDrive® S45 USB 3.0 flash drive 

Learn more >

Exec

Lexar® Professional 1800x microSDHC™/microSDXC™ UHS-II cards 

Learn more >

HD Pan/Tilt Wi-Fi Camera with Night Vision NC450

Learn more >

Lexar® JumpDrive® C20c USB Type-C flash drive 

Learn more >

Audio-Technica ATH-ANC70 Noise Cancelling Headphones

Learn more >

Budget

Back To Business Guide

Click for more ›

Most Popular Reviews

Latest News Articles

Resources

PCW Evaluation Team

Azadeh Williams

HP OfficeJet Pro 8730

A smarter way to print for busy small business owners, combining speedy printing with scanning and copying, making it easier to produce high quality documents and images at a touch of a button.

Andrew Grant

HP OfficeJet Pro 8730

I've had a multifunction printer in the office going on 10 years now. It was a neat bit of kit back in the day -- print, copy, scan, fax -- when printing over WiFi felt a bit like magic. It’s seen better days though and an upgrade’s well overdue. This HP OfficeJet Pro 8730 looks like it ticks all the same boxes: print, copy, scan, and fax. (Really? Does anyone fax anything any more? I guess it's good to know the facility’s there, just in case.) Printing over WiFi is more-or- less standard these days.

Ed Dawson

HP OfficeJet Pro 8730

As a freelance writer who is always on the go, I like my technology to be both efficient and effective so I can do my job well. The HP OfficeJet Pro 8730 Inkjet Printer ticks all the boxes in terms of form factor, performance and user interface.

Michael Hargreaves

Windows 10 for Business / Dell XPS 13

I’d happily recommend this touchscreen laptop and Windows 10 as a great way to get serious work done at a desk or on the road.

Aysha Strobbe

Windows 10 / HP Spectre x360

Ultimately, I think the Windows 10 environment is excellent for me as it caters for so many different uses. The inclusion of the Xbox app is also great for when you need some downtime too!

Mark Escubio

Windows 10 / Lenovo Yoga 910

For me, the Xbox Play Anywhere is a great new feature as it allows you to play your current Xbox games with higher resolutions and better graphics without forking out extra cash for another copy. Although available titles are still scarce, but I’m sure it will grow in time.

Featured Content

Latest Jobs

Don’t have an account? Sign up here

Don't have an account? Sign up now

Forgot password?