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Linux makes strides in enterprise market

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Linux advocates who have experience offering the open-source operating system to large companies say there's a rosy future in the enterprise market.

In the current environment of increased budget pressures, corporations are much more open to the idea of free, open-source software, said Dieter Hoffmann, managing director for Central and Eastern Europe at Linux software maker Red Hat.

He mentioned two examples - an international financial institution and a global telecommunication company - that have contracted with his company to install Linux systems recently.

The financial institution - Hoffmann declined to mention names - faced an order from its chief financial officer to all departments to cut budgets by 30% this year. Managers "wanted an immediate impact on their bottom line," he said.

That's where Linux came in. By switching more than 3,500 Sun Solaris workstations to Intel hardware with Red Hat Linux software, the company has seen its IT infrastructure costs drop by 75% - for a savings of $100 million over the next 3 years, Hoffmann said.

The telecom company, for its part, saw a drop of 50% in its hardware and software costs, after making a similar switch with 6,000 workstations, he said.

But short-term savings alone are not going to sell most large companies on Linux, said Jos Visser, CTO for Dutch open-source consulting firm Open Solution Providers.

"Since they have a big IT budget, they can buy just about anything they want," he said, adding that complex organizations tend to assume they need a large IT infrastructure.

What large organizations focus on, rather, is risk: They want to be assured that a system won't cause unnecessary problems, and tend to trust prominent vendors to take care of them.

"If you're coming around with Linux or Apache or whatever, you're not a vendor - it's very hard to convince them," he said.

Still, open-source software can be much quicker to acquire and implement in a large organization, because such software circumvents the often extremely complicated procurement process such companies go through to buy anything; and avoiding the hassles of maintaining software licenses is another advantage.

"I like speed - I can get stuff from the Web or any FTP server really fast," he said.

By introducing Linux on a small, "temporary" scale, advocates can open the door to larger-scale, longer-term enterprise implementations down the road, Visser added.

"There is really nothing in this world which lives as long as a temporary solution," he said.

Hewlett Packard's senior open source and Linux strategist said risk reduction is exactly why large companies should consider open-source software.

In the open-source world, "You can see what developers are doing, every 24 hours," said Bruce Perens - in contrast to "a big company that says it will do something, and just doesn't."

But big companies themselves have contributed a lot to raising Linux's profile in the business world, said Joerg Ludwig, IBM sales director for Linux solutions.

"We've invested a lot to be seen as a recognized player by the open-source community - of course, with the hope that it will pay off," he said.

Still, Visser said, despite HP and IBM's top-level commitment to open source, it "takes time for corporate strategy to trickle down to the sales force in the field. Selling free software is a pretty hard proposition for a salesman to get around to," Visser said. "So it's up to IT guerrillas in the field like me."

And that means some serious sacrifices on the part of Linux advocates who are seeking their fortunes in the corporate world.

He cautioned fellow enthusiasts to tone down their rhetoric, and to avoid bashing other vendors.

"We need to lose the attitude, the elite rhetoric," he said, pointing out that Linux is not the best answer for every single application, as some of its most committed advocates seem to suggest; there will always be a place for proprietary software.

The Linux community should not make false promises, he continued, such as that every problem will be easily solved by just posting an inquiry on Usenet message boards. "It might be that someone else has solved that problem before, but you can't count on it."

And open-sourcers should realize that large companies will not take kindly, at least at first, to the idea of contributing their developments to the community at large.

"Banks will hear, 'We're going to give something away,' and they don't want to do that ... because it's socialism, basically, and big banks are really afraid of socialism."

To continue to infiltrate the corporate market, "We will have to dress up in suits," said Visser, who was wearing jeans and athletic shoes, like many here at the Linuxworld trade show.

The IDG News Service is a Network World affiliate.

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