Group 7 Open Source Software LOGO Group 7

Group # 7 Open Source Software LOGO

Group # 7 – Open Source Software Andrew Benz Shuang Gao Xianjin Jiang Janice Hovis Jacob Steingrubey 2

Contents 1 Background of Open Source 2 Interviews 3 Open Source vs. Proprietary Software 4 Lessons Learned & Best Practices 5 Summary 3

Contents 1 Background of Open Source § § § Definition History Market Size Importance to Managers Technical Components 2 Interviews 3 Open Source vs. Proprietary Software 4

Open Source Software - Definition “OSS is licensed software in which the source code is made available to users to enable them to modify it for their own purposes and (within certain restrictions) redistribute original and derived works as they see fit. ” § § § No one has exclusive control over the term “open source” Not an enforceable copyrighted term or trademark Open Source Initiative (OSI) www. opensource. org – was founded in 1998 & has unofficial power over the core concepts Source: Gartner: “Learn the Basic Principles of Open-Source Software”, 16 -Nov 2006 ID # G 00144771 5

Open Source Software – Definition Free redistribution “License shall not require a royalty or other fee for such sale” Source code Must include source code & allow distribution (or a wellpublicized means of obtaining the source code) Derived works Must allow modifications & allow them to be distributed Integrity of author’s source License must permit distribution of software built from modified code source code No discrimination against Persons, groups or fields of endeavor (e. g. genetic research) Distribution of license Rights to program must apply to all without the need for execution of additional license License must not be specific to a product The rights attached to a program must not depend on the program’s being part of a particular software distribution License must not restrict other software Must not insist all other programs distributed on the same medium must be open-source software License must be technology-neutral No provision of the license may be predicated on any individual technology or style of interface Source: http: //opensource. org/docs/definition. php; viewed 4/13/09 6

Contents 1 Background of Open Source § § § Definition History Market Size Importance to Managers Technical Components 2 Interviews 3 Open Source vs. Proprietary Software 7

Open Source Software – History § Richard Stallman § American Software Freedom Activist, Hacker, and Software Developer § Noticed a change in software licensing while studying at MIT § Announced the “GNU Project” in September 1983 § Founded the Free Software Foundation in October 1985 Source: http: //en. wikipedia. org/wiki/Richard_Stallman Viewed April 10, 2009 8

Open Source Software – History Source: http: //www. gnu. org/gnu/initial-announcement. html Viewed April 10, 2009 9

Open Source Software – History § GNU Project § Mass collaboration project of software developers § Founding Goal: “I will develop a sufficient body of free software so that I will be able to get along without any software that is not free” § First project was to replicate the Unix operating system § Recursive acronym meaning “Gnu’s Not Unix” Source: http: //www. gnu. org/gnu/initial-announcement. html Viewed April 10, 2009 10

Open Source Software – History § The word “free” in “free software” pertains to freedom, not price § Think of “free” as in “free speech, ” not as in “free beer” http: //www. youtube. com/watch? v=u. Ji 2 rk. Hi. Nqg Source: http: //www. gnu. org/gnu/initial-announcement. html Viewed April 10, 2009 11

Open Source Software – History § Linux § By 1990, the GNU Project had created all of the major O/S components except for the kernel § Linus Torvalds, from Finland, decided to develop a free Unix/Minix-based operating system § http: //www. youtube. com/watch? v=z. Pb. Ftl. Mtzj 8 Source: http: //en. wikipedia. org/wiki/Linus_Torvalds Viewed April 10, 2009 12

Open Source Software – History Hello everybody out there using minix I'm doing a (free) operating system (just a hobby, won't be big and professional like gnu) for 386(486) AT clones. This has been brewing since april, and is starting to get ready. I'd like any feedback on things people like/dislike in minix, as my OS resembles it somewhat (same physical layout of the file-system (due to practical reasons) among other things). I've currently ported bash(1. 08) and gcc(1. 40), and things seem to work. This implies that I'll get something practical within a few months, and I'd like to know what features most people would want. Any suggestions are welcome, but I won't promise I'll implement them : -) Linus (torvalds@kruuna. helsinki. fi) Source: http: //en. wikipedia. org/wiki/Linus_Torvalds Viewed April 10, 2009 13

Contents 1 Background of Open Source § § § Definition History Market Size Importance to Managers Technical Components 2 Interviews 3 Open Source vs. Proprietary Software 14

Market Size Market Share for Top Servers Across All Domains August 1995 - March 2009 Source: http: //news. netcraft. com/ Viewed April 16, 2009 N = 231, 510, 169 Websites 15

Market Size Popularity of Linux (Google Searches) Source: http: //farm 4. static. flickr. com/3100/2780600959_5 e 8 e 7 bef 99_o. jpg Source: http: //farm 4. static. flickr. com/3168/2780600817_aa 8 c 88 d 847_o. jpg 16

Market Size § Open Source Database management revenues (support and professional services) will continue to grow during the next five years (2008 -2012) by 40%, exceeding $1 billion in 2012 2 § By 2012, more than 90% of enterprises will use open source in direct or embedded forms 1 § By 2011, at least one open source DBMS (My. SQL or Postgres Plus) will become one of the more widely used DBMS engines in production 2 Source: Gartner Survey “State of Open Source” (2008, April) 1 Source: Gartner Survey “Open Source in Database Management Systems (2008, April) 2 17

Contents 1 Background of Open Source § § § Definition History Market Size Importance to Managers Technical Components 2 Interviews 3 Open Source vs. Proprietary Software 18

Importance to Managers Open source provides options to Managers by allowing collaboration, which result in lower transaction costs. Four Business Principles of Wikinomics: § § Openness Peering Sharing Acting Globally Examples of Collaboration: § § § Proctor & Gamble Goldcorp Progressive Insurance Source: Tapscott, Don and Williams A “Wikinomics: How Mass Collaboration changes everything, ” Portfolio, Penguin Group, New York, 2007 Chapter 1 page # 20 19

Importance to Managers N = 119 Governmental Agencies in North America & Europe 20

Importance to Managers N = 95 participants, large enterprises Source: http: //asay. blogspot. com/2005/11/forrester-open-source-rising-heres. html 21

Contents 1 Background of Open Source § § § Definition History Market Size Importance to Managers Technical Components 2 Interviews 3 Open Source vs. Proprietary Software 22

Technical Components Technology What it is… Why it matters… TCP/IP Communications protocol Allows remote systems to communicate HTML Presentation language Consistent means of viewing information XML Data language Human-readable method of storing and transmitting data Java Programming language Creates software that can run anywhere Web Services Open machine interaction Allows functional outsourcing Linux Operating system Open link between hardware and software 23

Contents 1 Background of Open Source 2 Interviews § § § 3 Company Background Uses of OSS Reasons for Choosing OSS Risks & Challenges Future Plans for Open Source vs. Proprietary Software 24

Company Background – Panera Bread § Company background – § § Operates & franchises retail bakery cafes Mission Statement: “A loaf of bread in every arm” 1, 268 locations in 41 states and Canada; over 23, 000 employees $2. 5 billion system-wide annual revenue ($1. 3 billion company revenue); $67 million profit 25

Company Background – Panera Bread § Company background – IT Department § § § IT headcount = 95 IT annual $ budget = $7. 2 million Panera provides free Wi. Fi to customers Organization structure: CIO reports to COO Interviewed: Mike Gustafson, Director of Technical Services (reports to CIO) • B. S. Systems Science & Mathematics from Washington University • Prior to Panera, Mike was a consultant for IBM & Ernst & Young 26

Company Background – Scottrade § Online investment broker § Started in 1980 by Rodger Riney § Revenue § Annual revenue of over $1 billion § Over 2, 000 new accounts per day § Over 200, 000 trades per day § Size § Over 400 branches § Over 2, 000 employees 27

Company Background – Scottrade § Scottrade Bank § § Recently opened Currently used for “bank sweeps” Will become “full-service” Size • 6 th largest bank in Missouri • Holds about $5 Billion in assets • Over 5 employees 28

Company Background – Scottrade § IT Organization § 400+ IT staff, increasing to 600 § CIO Reports to Rodger Riney, President and CEO of Scottrade § Facilities § Primary data center over 10, 000 square feet § Over 2, 000 “blade” servers § Mainframe computer system 29

Company Background – amdocs Michael Fang Solution Architect § Provide BSS(Business Support System) and OSS(Operation support System) software and service to telecommunication industry. § Revenue in fiscal year 2008 is $3. 16 billion § The market leader in customer experience systems § Has more than 17, 000 employees and serves customers in more than 50 countries around the world. 30 34

Company Background – amdocs 31

Company Background – amdocs § What’s the largest expense of the IT budget? § Salary § Software licenses & Hardware § Does Am. Docs contribute to the code when discovering issues? § Yes. 32

Contents 1 Background of Open Source 2 Interviews § § § 3 Company Background Uses of OSS Reasons for Choosing OSS Risks & Challenges Future Plans for Open Source vs. Proprietary Software 33

Uses of Open Source Software Open Source Adoption Panera Scottrade amdocs Server Operating Systems X X X Database Management Systems X X Security X Application Integration/Middleware X X Application Development X X Content, Communication & Collaboration Business Process Management X Business Intelligence Customer Relationship Management Enterprise Resource Planning Client/Desktop OS Office Suite Other X X 34

Uses of Open Source Software § Current OSS used at Panera Bread: 1. 2. 3. Linux • Server Operating system • Use Red hat for support Grinder • Simulates loads in a new environment • Pushed load to 400% and it did not “break” Nagios • • Monitors server and hardware (1, 250 T 1 lines) Used proprietary initially, but costs increased 300% 35

Uses of Open Source Software 36

Uses of Open Source Software § Open Source Software at Scottrade § Currently about 10% of total server population is OSS (about 200 Linux servers) § Been in use for 2 -3 years § Ticker Plant § Communication with Market Makers § Communication with mainframe 37

Uses of Open Source Software § Amdocs OS strategy § Use both proprietary and open source software. § In IT company, staff prefer to use Open Source Software § Special team is responsible for developing OS strategy for the company. § Evaluation • Product Evaluation Group – Mainly responsible for evaluate and identify useful open source software. 38

Contents 1 Background of Open Source 2 Interviews § § § 3 Company Background Uses of OSS Reasons for Choosing OSS Risks & Challenges Future Plans for Open Source vs. Proprietary Software 39

Reasons for Choosing OSS Panera Scottrade Am. Docs Cost Savings X X X Stability X X X Industry Standard X X Lower Administrator/Server Ratio X Flexibility X Ease of Use X X X 40

Reasons for Choosing OSS Advantages § § § Panera § Lower Cost • “free” operating system compared to UNIX: $30 -40 K to purchase + $20 K per year for support § Stability • Linux is technically solid; no issues running missing critical applications § Easy to Maintain • UNIX requires very specific training and additional costs Scottrade § Freedom • Not “tied down” to strictly using Microsoft products § Lower Cost • Microsoft cost estimates are $400 -$500 / seat for O/S § Fewer Problems • Less downtime, lower administrator / server ratio (200 servers, 6 admins) § Updates • Can use the latest version of the software for free, instead of paying for the upgrade § More security • Using multiple O/S environments creates a better security portfolio Am. Docs § Flexibility • Potentially broader community for ideas exchange and problem solving. • Extend the function by own. § Code availability • Code availability for debugging and enhancement. 41 § Lower cost

Secondary Research - Adoption of Open Source Software N = 95 participants, large enterprises Source: http: //asay. blogspot. com/2005/11/forrester-open-source-rising-heres. html 42

Secondary Research - Adoption of Open Source Software 43

Contents 1 Background of Open Source 2 Interviews § § § 3 Company Background Uses of OSS Reasons for Choosing OSS Risks & Challenges Future Plans for Open Source vs. Proprietary Software 44

Risks & Challenges Company Risks / Challenges Faced Panera • Maintaining a stable environment amidst many changes and rapid growth • Security – what is embedded in source code? (Panera uses 3 anti-virus engines that secure us from this issue) Scottrade • Difficulty getting managerial buy-in • “If it’s free, it can’t be good” • No technical support • Compatibility issues Am. Docs • Less robust features than commercial software • No guarantee of quality or fitness • Considering system functional compatibilities, some proprietary software should be used. 45

Contents 1 Background of Open Source 2 Interviews § § § 3 Company Background Uses of OSS Reasons for Choosing OSS Risks & Challenges Future Plans for Open Source vs. Proprietary Software 46

Future Plans for OSS Company Future Plans Panera • Enterprise Database – for non-mission critical applications (oracle “lookalike”) • Trouble tickets Scottrade • More servers • Virtualized desktops (thin clients) • Virtual servers (possible shift away from VM Ware) Am. Docs Use open source software in Business Process Management JBMP-------JAVA based open source software 47

Contents 1 Background of Open Source 2 Interviews 3 Open Source vs. Proprietary Software § § § Advantages & Disadvantages Cost Proprietary Vendors’ Strategy Changes 48

Advantages & Disadvantages of OSS Open Source Software Pros Financial Saving (1) Open Source Software Cons No guarantee of quality or fitness (1) View, change and redistribute source No strong support exists for open source code (1)(2) software(1) Easy integration and interaction(1)(2) Difficult for companies to choose (2) Rapid debugging, rapid further development(1) Avoiding lock-in to one supplier(1)(2) Source: http: //www. redpill-linpro. com/About-Open-Source/Advantages-of-Open-Source-software (1) Source: Paul, Kavanagh, . Open source software implementation and management. Amsterdam: Elsevier Digital P, 2004. (2) 49

Advantages & Disadvantages of Proprietary Software Pros Proprietary Software Cons Vendor professional services No access to code for potentially quick problem solve Easier to adopt in organization Unable to extend the functionality by own Automated updates Cost more Better product functionality Code quality Source: http: //news. cnet. com/8301 -13505_3 -9789275 -16. html Date Viewed April 18, 2009 50

Advantages & Disadvantages of OSS Source: http: //news. cnet. com/8301 -13505_3 -9789275 -16. html Date Viewed April 13, 2009 N =228 Enterprise 51

Advantages & Disadvantages of OSS www. Computer. Economics. com Individual Survey Source: http: //www. computereconomics. com/article. cfm? id=1043 Date Viewed April 13, 2009 N=50, 000 52

World Views on Commercial OS United States 1 Europe 1 China 2 Cost Vendor Lock-in Control Return on investment Create local software industry Create gov’t software industry Dual Licensing Model Widely accepted Not true open source No strong opinion Software Sales Model Direct VAR and SI SI OS Business Model Product based, up-sell from open source Support and service subscription Products and/or support Expectations around OS products Some code available under OS, Commercial product management All code available under OS, Community governance model Lack of community participation Primary reason for adopting OS Key driver for investment in OS Source: Larry Augustin's Weblog, ‘Commercial Open Source in Europe Versus the US. ’ 1 Source: Guangnan Ni, Accessed April 20, 2009, http: //tech. it 168. com/zt/open 2009/ppt/1. ppt 2 53

Contents 1 Background of Open Source 2 Interviews 3 Open Source vs. Proprietary Software § § § Advantages & Disadvantages Cost Proprietary Vendors’ Strategy Changes 54

Total Cost of Ownership § Open Source § Free Redistribution § Support is fee-based and at a fraction of proprietary systems § Training – depends on ease of use § Proprietary § Pay for license (high up front fees) § Phasing out free tech support & less manuals with product (support is close to becoming similar to open source) § Training – depends on ease of use Source: Feldman, David (2006, February) “Understanding open source: Part 1” KM World 15(2) 8 -10 55

Total Cost of Ownership How much does “free” software really cost? 1. Price of software is relatively low compared to TCO (total cost of ownership) 2 2. The significant costs = Staffing needed (for any platform of software) Training, maintenance, support, administrative 50 -70% of a software system’s TCO over it’s useful life 2 3. Analyzing TCO is not simple – it depends on the different ways people use the software. 1 Source: http: //www. computereconomics. com/article. cfm? id=1043; Viewed 4. 22. 09 1 Source: Mac. Cormack, Alan (2003, August) “The True Costs of Software”; Computerworld (37, 33; pg 44) 2 56

Total Cost of Ownership How much does “free” software really cost? Summation: Open source software key advantage is not always low cost of ownership 1 • Administrative and support costs overshadow initial software license cost and annual maintenance fees (costs that are minimized by open source) 2 • Whether open source software is less costly to administer than proprietary software depends on a ready pool of resources trained on the system 1 • Situation varies from application to application 2 Source: http: //www. computereconomics. com/article. cfm? id=1043; Viewed 4. 22. 09 1 Source: Mac. Cormack, Alan (2003, August) “The True Costs of Software”; Computerworld (37, 33; pg 44) 57

Contents 1 Background of Open Source 2 Interviews 3 Open Source vs. Proprietary Software § § § Advantages & Disadvantages Cost Proprietary Vendors’ Strategy Changes 58

Proprietary Vendors’ Strategy Changes Financial fortune is dependent on software license Does not perceive as a threat or business opportunity (2008) Sponsors the Apache Foundation; Brad Smith key note speaker at the OS business conference 3/08 Contributes to OS Initiatives (Apache Foundation); Oracle VM – offers clients virtualization option alternative to VMware Future: Support/integrate products with open source solutions Acquired Sun Microsystems (Java) announced 4. 20. 09 Summation: Customers should not expect them to embrace OS as Oracle Provide customers with “end to end” software stack using a combination History of Open Source: Shift in thinking about Open Source: Gartner: “Open Source at Microsoft, 2008” 3 April 2008 Source: Gartner: “Open Source at Oracle, 2008”; 27 March 2008 59

Contents 1 Background of Open Source 2 Interviews 3 Open Source vs. Proprietary Software 4 Lessons Learned & Best Practices 60

Lessons Learned & Best Practices Due to the current global down economy, we have seen interest in open source software spike among mainstream and conservative enterprises alike in recent months. 1 § Over 10 years of Gartner studying open source software dynamics, there are many examples where enterprises successfully leveraged open source for significant cost savings over closed source. § Gartner also found where adopters were unable to clearly demonstrate sustained cost savings over time. § Key Factors to optimizing software costs: – Focus on project maturity – Understand that project governance dictates both quality and risk (IP concerns) – Identify specific technology risk profile 1 Understand early in the process which alternatives are more viable: § Number of users organizations – § Peculiarity of Operating System Platform § Product Market Maturity § Sourcing Attitude § Available Skills Source: Gartner: “Findings: yes, you can save money with open source software” 30 Jan 2009 1 Source: Gartner: “When to use Custom, Proprietary, open Source of Community Source Software” (16 Feb 2007) 2 2 61

Lessons Learned & Best Practices § Involvement, positioning and decision-making levels of management affect the success of migration projects § While migration to open source offers cost savings in the long run, deploying the new technology may involve considerable expenses § Cost reduction is an important motive for organizations to migrate from proprietary to open source software § Well timed and sustainable training contributes to the success of migration project § Developing a clear process for migration and involving a qualified project team contributes to the success of migration project § The migration from old to new technology requires shifting the mindsets of users towards the new technology § Support available from multiple vendors reduces the risk associated with vendor lock-in § Business-IT partnerships are required to facilitate the implementation of new technology § Migration from proprietary to open source software involves overcoming internal resistance to deploy new technology within an organization Source: https: //eduforge. org/docman/view. php/7/414/Owais_Ahmed_TTMthesis. pdf 62

Contents 1 Background of Open Source 2 Interviews 3 Open Source vs. Proprietary Software 4 Lessons Learned & Best Practices 5 Summary 63

Contents 1 Background of Open Source 2 Interviews 3 Open Source vs. Proprietary Software 4 Lessons Learned & Best Practices 5 Summary 64

Summary § Background § Linux, GNU are examples of mass collaboration § Does not equate to “free of charge” § Interview § More companies use combination strategy – both use OSS and Proprietary § Many advantages; but most companies slow to adopt § Open Source vs. Proprietary § Proprietary software companies change strategy § Lessons Learned & Best Practices § Reasons vary between individual & corporation adopting 65

Summary 66

Citations 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19. 20. http: //opensource. org/docs/definition. php; viewed 4/13/09 http: //www. gnu. org/gnu/initial-announcement. html http: //www. youtube. com/watch? v=z. Pb. Ftl. Mtzj 8 http: //www. gnu. org/gnu-history. html http: //news. netcraft. com/ Viewed April 16, 2009 Gartner: “Government Survey Dispels Five Myths About Open-Source Software”; 1 February 2008 Source: Tapscott, Don and Williams A “Wikinomics: How Mass Collaboration changes everything, ” Portfolio, Penguin Group, New York, 2007 Chapter 1 pg 18 Source: Gartner Survey “State of Open Source” (2008, April) Source: Gartner Survey “Open Source in Database Management Systems (2008, April) http: //www. computereconomics. com/article. cfm? id=1043 Date Viewed April 13, 2009 Source: Gartner: “Findings: yes, you can save money with open source software” 30 Jan 2009 Source: Gartner: “When to use Custom, Proprietary, open Source of Community Source Software” (16 Feb 2007) Source: Larry Augustin's Weblog, ‘Commercial Open Source in Europe Versus the US. ’ Source: Feldman, David (2006, February) “Understanding open source: Part 1” KM World 15(2) 8 -10 Retrieved April 7, 2009 from ABI/INFORM Global Database Source: http: //www. computereconomics. com/article. cfm? id=1043; Viewed 4. 22. 09 Source: Mac. Cormack, Alan (2003, August) “The True Costs of Software”; Computerworld (37, 33; pg 44). Retrieved April 7, 2009 from ABI/INFORM Global Database. Source: Gartner: “Open Source at Microsoft, 2008” 3 April, 2008 Source: http: //www. infoworld. com/print/71928 Viewed on April 23, 2009 Source: Gartner: “Open Source at Oracle, 2008”; 27 March 2008 67

Citations 21. 22. 23. 24. 25. 26. 27. 28. 29. 30. 31. 32. 33. Source: http: //www. oracle. com/us/corporate/press/018363 Viewed on April 24, 2009 Source: MIT Sloan management Review “The Oh-So-Practical Magic of Open Source Innovation”; Fall 2008 Source: MIT Sloan Management Review “What makes a virtual organization work”? ; volume 42; Number 1 – Fall 2008 Interview: Mike Gustafson, Director of Technical Services of Panera, LLC, interviewed in person by Janice Hovis, March 5, 2009 Interview: Michael Fang, Solution Architect of Am. Docs, interviewed in person by Shuang Gao, March 15, 2009 Interview: James Cammaratta, IT of Scottrade, interviewed in person by Jacob Steingrubey, April 7, 2009 Paul, Kavanagh, . Open source software implementation and management. Amsterdam: Elsevier Digital P, 2004. Source: Castelluccio, Michael (2008) “Enterprise Open Source Adoption” Strategic Finance, 90(5) 5758 Retrieved April 30, 2009 from ABI/INFORM Global database Source: Adenekan, Dedeke (2009) “Is Linux Better than Windows Software”, IEEE Software, 26(3), 104, 103; Retrieved April 30, 2009 from ABI/INFORM Global Database Source: Babcock, Charles (2009, February) “Why Windows Must go Open Source”, Information Week (1219), 22 -24, 26, 28. Retrieved April 30, 2009 from ABI/INFORM Global Database Source: Montalbano, Elizabeth (2008, December); “Microsoft Reverses Course, Becomes More Open to Open Source Community”; Computerworld, 42(49)10. Retrieved April 30, 2009 from ABI/INFORM Global Database Source: Watson, Wynn, Boudreau (2005, September) “JBOSS: The evolution of Professional Open Source Software”; MIS Quarterly Executive Vol 4 No 3. Source: Murray, Gwyn (2009, January) “Categorization of Open Source Licenses: More than Just Semantics”; The Computer & Internet Lawyer Vol 26 No 1 68

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