Open source take-up booming in APAC

Open source accounts for between 25 and 70 percent of all software in Australian, Chinese, Indian and Korean companies, according to a recent IDC survey.
Written by Aaron Tan, Contributor

Open source accounts for between 25 and 70 percent of all software in Australian, Chinese, Indian and Korean companies, according to a recent IDC survey.

In an interview with ZDNet Australia sister site ZDNet Asia, Wilvin Chee, research director with IDC's Asia-Pacific software research group, said: "Businesses are using a variety of open source software, ranging from infrastructure software and storage to enterprise applications such as CRM (customer relationship management) and ERM (enterprise resource management)."

Conducted by IDC between February and March this year, the study involved top executives from about 1,000 companies of all sizes.

Chee said most organisations in the Asia-Pacific region are opting for open-source software because they perceive it to offer better protection against security breaches, a view which the analyst said is "justified to some extent".

The open source development process means software can be developed in collaboration with programmers and end users who want to improve software for its own sake, rather than to seek commercial objectives, he said.

"Because of this non-association with commercial purposes, open-source software is not bound by time-to-market deadlines," Chee explained. "And there is no pressure from end users to adopt it, because people are always looking forward to newer versions of commercial software."

Better vendor support from open-source companies, compared to proprietary software providers, is another reason for companies to adopt open source. This is because support services underpin the business model of open source companies, which are "a little more forthcoming in providing the relevant support", Chee said.

He added: "They are also able to come up with less complex support structures for open source users."

Noting another key difference, Chee said that when it comes to proprietary software, there is a tendency for companies to "buy something more than what they really need".

Vista sparks interest
Maarten Koster, president of Novell Asia-Pacific, said that the release of Windows Vista has given companies in less-developed markets a reason to consider open source alternatives.

Noting that organisations face the decision of Vista hardware investments, Koster said: "If I don't need full functionality on the desktop, maybe I'll go open source.

"If you want to roll out a low-cost infrastructure in India and China, open source is definitely the way to go," he added.

However, while open-source software may be perceived to be cheaper because there are no upfront licensing costs involved in software acquisition, Chee said, the total cost of ownership (TCO) of open source-software varies.

"Both proprietary and open-source vendors will provide their own attractive TCO propositions," he said.

"What's critical to businesses is services support, regardless of the kind of software they're using," Chee added. "Businesses want to ensure that they really know how to use the software, especially when they have software from multiple vendors."

Yap Boon Leong, business development director of Resolvo Systems, a Singapore-based open-source software developer with operations in Cambodia, noted that open source is appealing in emerging markets because businesses there tend to be very price-sensitive. "In emerging markets, businesses want to have the lowest TCO possible," Yap said, adding that Resolvo offers a utility pricing model in Cambodia for its open source-based products such as inventory control and sales force automation. Resolvo also provides support and deployment services for companies that want to keep their software and data on their own servers.

Regardless of software delivery or development models, Chee noted, businesses in the Asia-Pacific region are a practical bunch. "It doesn't matter if software is open source or proprietary, as long as it can meet their requirements," he said.

He added that when companies consider any software acquisition, several factors come into play. This includes the level of reliability and security, as well as the skills needed to use the software effectively.

"At the end of the day, the concerns surrounding open source and proprietary software are very similar," Chee said.

He said the lack of skills in deploying open-source software remains a problem among Asia-Pacific companies, including small and midsize businesses which typically do not have in-house tech expertise or an IT department.

On Microsoft's move to provide assurances against patent lawsuits, Chee said that Asia-Pacific companies do not have major concerns about being sued for using Linux, because "it's really a problem between vendors, and not the end users".

"Typically, vendors will give assurances to the end-user community on the things that will protect them from lawsuits," Chee said. "From what I've seen in our previous surveys when the SCO litigation was at its peak, users didn't say that litigation was a key concern."

Beyond Linux
While the Linux operating system has been the poster child of the open source community, the market for open source business applications like CRM and ERP is still nascent, Chee said.

Jason Lim, director of technology at iZeno, a Singapore-based systems integrator that specialises in open-source business applications such as Compiere ERP and SugarCRM, said: "Most people hardly hear of open-source business applications, but we think open source will slowly move up the software stack."

Open-source business applications have matured over the years, particularly in terms of features and usability, but there is still room for improvement.

"Developers like to build impressive architectures, and very few are focused on UI (user interface) -- that could also be why we've not seen mass adoption of open-source business applications," Lim said. "You can tell business users about all the features available, but if usability is poor, adoption will be very low."

Lim said that it is generally easier to sell the open source story to SMBs since it provides cheaper alternatives to the likes of SAP and Oracle. Almost all of iZeno's customers are SMBs.

"It's very difficult for us to go into the multinational companies because they can't [afford for] systems to go down for even an hour, and not many systems integrators support the applications," Lim said.

"Furthermore, not many enterprises are willing to take the first step to run their critical operations such as finances on open-source ERP applications," Lim added.

However, one area that large enterprises may be more receptive to using open source is CRM. Lim said that unlike ERP, if issues arise in the open source CRM application, the entire business operations will not be affected.

He added that the relatively simpler workflow processes in CRM requires a smaller degree of customisation, so enterprises can get these applications deployed quickly.

Editorial standards