Citigroup buys into open source

Citigroup buys into open source

Summary: Linux on Wall Street: But open source systems don't offer a 'significant' competitive edge, and the cost benefits are 'frothy and overhyped'

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TOPICS: Apps
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A senior architect at the financial services giant Citigroup said on Monday that the company is using a lot of open source software, but that such software is mainly useful for horizontal applications that do not offer the bank significant competitive advantage.

"We make extensive use of open source [for trading systems], and I expect it will continue to be a very big part of what we do for the next few years," said Jeremy Lehman, the chief software architect at Citigroup's Global Equities group, during a talk on open source trading applications at the Linux on Wall Street Conference in New York.

Lehman said that open source should not be used for the parts of business processes that provide a "significant" competitive edge, or for vertical uses — such as specialised trading functions — but is worth considering for all other areas.

"Open source may not be a wellspring of competitive advantage, but it allows you to focus your efforts [on the important parts of your system]," he said. "Open source could probably provide about 99 percent of your code base."

Despite the long-running battle between Linux vendors and Microsoft over which operating system offers a lower total cost of ownership (TCO), Lehman said other factors are more important.

"I don't believe TCO is the primary driver for open source," he said. "I think the whole financial aspect of open source is a little bit frothy and over-hyped."

Open source offers a number of advantages, including the ability to add specific features to applications when needed, and an easier migration from proprietary Unix systems, according to Lehman.

"You have the ability to add features that are very specific to the business, and you can have them exactly when you need them," he said. "Open source is the easiest migration from proprietary Unix systems. If you're going 'greenfield', there's a lot to be said for using [Microsoft's] .Net. But if you're migrating from proprietary Unix, it's easier to go to Linux on AMD or Intel."

But there are still some challenges to using open source, including the lack of tools for messaging, business process management and analytics, and the lack of skilled staff in some parts of the world, such as Asia, according to Lehman.

He said that Asia is still behind the US in its open source skill base, which can make it difficult to use open source for global banking applications.

"Open source is not as mature in the rest of the world as it is in the US. So you can get lot of pushback in the rest of world. It is a lot of tougher to get acceptance of Linux in, say, Korea, compared to Windows. But in a couple of years that will shift," he said.

Topic: Apps

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  • "But open source systems don't offer a 'significant' competitive edge, and the cost benefits are 'frothy and overhyped'

    Oh, what codswallop.

    Read this:

    http://www.localtechwire.com/article.cfm?u=13851

    "FAA Reports $15M in Savings in Deploying Red Hat Enterprise Linux"
    anonymous