Open-source software will be key to the adoption of software as a service over the next few years to keep costs down and make sharing of applications easier.
By 2010, around 90 percent of software-as-a-service (SaaS) providers will be using open source within their technology "stacks" — operating systems, application servers and databases — according to analyst house Gartner.
Open source will make up at least 30 percent of each individual SaaS application provided by vendors by 2010, according to Gartner.
The analyst predicts users will increasingly turn to "application platform as a service" providers to bring in open source to help share software applications.
Robert DeSisto, analyst at Gartner, said as more SaaS vendors use open source in their product line, software-acquisition costs should be reduced.
But he warned users should not assume prices will fall as vendors may choose to improve profitability or increase spending on research and development.
He added as more businesses adopt SaaS applications, the applications exchange will continue to grow.