Open Source Pulls in $1.8 Billion in 2006

According to a new IDC study, the growth in adoption of stand-alone open source software reached $1.8 billion in 2006 and will grow 26% annually for the next four years, hitting a total market worth of US$5.8 billion in 2011. IDC found that the open source market is in a significant stage of growth, as previous barriers to adoption fall away. Software distribution is growing, but revenues will take longer to follow suit, researchers found. That's partly because much open source software is free, while other products use a subscription revenue model rather than getting users to pay a lump sum up front.

In the business world, companies are waking up to the fact that open source opens up more choices and gives them something to use as a bargaining chip with proprietary software vendors. Companies are also becoming more comfortable with subscription revenue as a business model, something common among open source companies, while larger enterprises are also getting on board. Financial backing from venture capitalists is helping boost growth, IDC said.

News source: PC World

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12 Comments

lylesback2 said,
So much for a FREE operating system...

Wow! It is amazing how clueless some people can be. When did open source become an operating system?... and assuming the story was just about Linux et al., when did open source operating systems equate to being free? My company purchases licenses for both Red Hat and SUSE along with many other open source (non-OS) solutions. You need the right tool for the job. Don't get blinded by brand loyalty.

Open Source is simply a concept, it's not a product, and it's not solely an Operating System.

Besides, Open Source Operating Systems doesn't automatically equate to being "non-profit" or "completely free", yes source code is often freely available and can be compiled freely, but a lot of Open Source Operating Systems offer licenses and support for a nominal fee. And many businesses & enterprises pay said prices, because they need that particular software solution for a particular reason, and would like to have guaranteed support to come along with their software solutions.

Nice to see.

Even users of proprietary Microsoft of Unixes (Unices?) can benefit from Open Source, by using it as a bargain chip, like the article mentioned.

It's good for everyone.

any market without serious competition (as is the computing market) is a scary market. I'm a Linux user but I would hate to see Linux become the sole platform. Competition helps everybody by keeping the other companies on their toes.

Strange, I read an IDC article in 2003 that reported Linux would be a 35 billion dollar industry by 2008. I assume a miracle will be happening soon to achieve that projection by 2008.

My guess is there's been a lot of money that hasn't been accounted for in this figure. Pretty much all open source developers put up those signs saying "if you support my software donate to the project" which I knew quite a few people do.

IDC studies stink!. The IT market is too fluctuant so it's hard (impossible) to determine a trend, so any projection done for more that 3 years become useless.

Anyways, open source is just a concept, not a product or a specific market, nor is specifically linux.

Magallanes said,
Anyways, open source is just a concept, not a product or a specific market, nor is specifically linux.
Exactly. It would include things like Apache running on Windows servers, and businesses that run and support those.

Some people have their Linux-hating glasses on, and equate all Open Source news to Linux, then make flawed conclusions and statements.

markjensen said,
Exactly. It would include things like Apache running on Windows servers, and businesses that run and support those.

Some people have their Linux-hating glasses on, and equate all Open Source news to Linux, then make flawed conclusions and statements.

Even so, that's not the OP's point. He is saying where is this $35 billion dollar figure? Surely it isn't inside of a $1.8 billion dollar sum. If open source includes Linux as well, then the number should be a lot higher.

Point? Good luck open source.

Primetime2006 said,
Even so, that's not the OP's point. He is saying where is this $35 billion dollar figure? Surely it isn't inside of a $1.8 billion dollar sum. If open source includes Linux as well, then the number should be a lot higher.

Point? Good luck open source.

Point? Ummm... A prediction was wrong.

Nothing here to get confrontational with the snide "good luck" comment.

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