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EU Commission Study Finds You'll Save Money Switching to FOSS
Friday, January 12 2007 @ 02:50 AM EST

The EU Commission's Final Report on its "Study on the Economic impact of open source software on innovation and the competitiveness of the Information and Communication Technologies (ICT) sector in the EU" is now available on its policy documents, publications and studies page as a PDF.

I thought you'd be interested in the conclusion regarding total cost of ownership. Is it true that switching to Open Source will cost you more than staying with Windows, as Microsoft's "Get the Facts" page claims? No. The study found:

"Our findings show that, in almost all the cases, a transition toward open source reports of savings on the long term – costs of ownership of the software products."

But what about training costs? Doesn't that remove the benefits? No, the report found:

"Costs to migrate to an open solution are relevant and an organization needs to consider an extra effort for this. However these costs are temporary and mainly are budgeted in less than one year."

So there you are.

Oh, and what about loss of productivity if you switch to OpenOffice.org? None:

"Our findings report no particular delays or lost of time in the daily work due to the use of OpenOffice.org.... OpenOffice.org has all the functionalities that public offices need to create documents, spreadsheets, and presentations."

It has another advantage, the study found: it supports ODF:

"OpenOffice.org is free, extremely stable, and supports the ISO Open Document Standard."


Here's the relevant section with the conclusions of the study:

***************************

12.7. Conclusions Our analysis has been performed on six organizations in different European countries. The majority of them are public bodies. The organizations have followed different types of migration on the base of their context.

We have investigated the costs of migration, and the cost of ownership of the old and the new solution differentiating them between the costs of purchasing and the costs of ownership of the software solutions. Special attention has been put on the intangible nature of the costs. Costs have been classified in categories defined trough existing studies and selected by a top down approach called Goal Question Metric. This instrument has been also used to define the questionnaires used to collect the data.

Our findings show that, in almost all the cases, a transition toward open source reports of savings on the long term – costs of ownership of the software products.

Costs to migrate to an open solution are relevant and an organization needs to consider an extra effort for this. However these costs are temporary and mainly are budgeted in less than one year. The major factor of cost of the new solution – even in the case that the open solution is mixed with closed software – is costs for peer or ad hoc training. These are the best example of intangible costs that often are not foreseen in a transition. On the other hand not providing a specific training may cause and adverse attitude toward the new technology. Fortunately those costs are limited in time and are not strictly linked to the nature of the new software adopted.

We also investigated the productivity of the employees in using Microsoft office and OpenOffice.org. Office suites are widely used and are a good test bed and representative for a comparison on issues like effort and time spent in the daily routine of work. Delays in the task deliveries may have a bigger impact than costs on the organization's management. Our findings report no particular delays or lost of time in the daily work due to the use of OpenOffice.org.

12.7.1. Considerations

With our analysis we achieve a good level of understanding of the costs, benefits and productivity of a transition. The following are the considerations we have drawn upon.

1. Before buying, upgrading proprietary office software one needs consider that:

OpenOffice.org has all the functionalities that public offices need to create documents, spreadsheets, and presentations

Upgrading office programs is time-consuming and expensive. It requires installation time, potential document conversions, and new training. It also poses a risk because some documents containing code or macros may not be readable anymore

OpenOffice.org is free, extremely stable, and supports the ISO Open Document Standard.


  


EU Commission Study Finds You'll Save Money Switching to FOSS | 262 comments | Create New Account
Comments belong to whoever posts them. Please notify us of inappropriate comments.
Corrections Here
Authored by: feldegast on Friday, January 12 2007 @ 03:19 AM EST
So PJ can fix them.

---
IANAL
My posts are ©2004-2007 and released under the Creative Commons License
Attribution-Noncommercial 2.0
P.J. has permission for commercial use.

[ Reply to This | # ]

Off Topic
Authored by: feldegast on Friday, January 12 2007 @ 03:20 AM EST
Please make links clickable

---
IANAL
My posts are ©2004-2007 and released under the Creative Commons License
Attribution-Noncommercial 2.0
P.J. has permission for commercial use.

[ Reply to This | # ]

EU Commission Study Finds You'll Save Money Switching to FOSS
Authored by: Anonymous on Friday, January 12 2007 @ 03:28 AM EST
It is no wonder that Openoffice supports the ODF format, hehe.
But its stability is really important, compared to MsOffice.
The various exploits and crashers in MsOffice make it really unwanted. My only
problem with OO is its speed :(

[ Reply to This | # ]

Well I'll be...
Authored by: Anonymous on Friday, January 12 2007 @ 04:07 AM EST
So let me get this straight...
Free Software... With all it's choices, no forced upgrades, standards, openness,
sharing, etc...
Is cheaper than MS's costly proprietary solutions?

I've also heard patents are being shown to be bad for science. Also, that one
shouldn't patent algorithms, it's bad for the software industry too...

To add to it, I've even heard some people losing their appetite for DRM...

Hmm... :) I'm one happy camper...

/me continues to surf on his GNU/Linux lappy

[ Reply to This | # ]

Looks like a Good Report
Authored by: Anonymous on Friday, January 12 2007 @ 05:22 AM EST
PJ only reports the first part of the conclusions (not unfairly) so you should read the whole thing - giafly

I think the most interesting conclusions were:
* Employees may perceive that their work is under-valued using 'cheap' OSS products.
* There are no extra costs due to lack of productivity arising from the use of the OOo.

One additional issue that was not considered: Outlook 2007 uses MS Word to render HTML, so some users whose companies send HTML emails may in practice have to use MS Word to edit them. Outlook is widely used, but this was not the case with previous versions.
See Get your HTML newsletters and emails ready for Outlook 2007

[ Reply to This | # ]

Switch cost has always been a red herring..
Authored by: Peter Baker on Friday, January 12 2007 @ 05:40 AM EST
[no relation to the Red Dress, btw :-)]

There is a two simple arguments against the costs of switching being a deciding
factor:

(1) UI stability is higher in Linux. KDE has been more or less the same since
v3, same with Gnome (so that's the platform), ditto for OpenOffice. They get
subtly more usable, but the changes are small increments. The reason for that
is very simple, it's driven by user requirements. So switch costs are one-offs
- train once and forget.

(2) Microsoft is the worst offender. They have a (by now desperate) need to
make an almost-the-same product look radically different to sell the upgrade,
and the results create havoc for users. I've seen the change from Win 3.11 to
W95 which introduced the 'Start' button idea, I've seen the changes in the
Control Panel where all of a sudden things had to be in categories (and a again
a menu change) in W2K.

Anyone who has been at the receiving end of a productivity downgrade from Office
2000 to Office 2003 where items disappeared of the menu after a while, or where
the mail merge suddenly worked radically different knows what I'm talking
about.

So, to have MS allege that there is a cost of switching is rather rich, and
solely relies on the current ignorance of its customer base.

As a little aside, that also goes for the mechanics underneath. Old Unix hands
don't really get lost there, and if you code macros for OpenOffice you're
dealing with one single macro language, not with VBA for Excel and VBA for Word
separately.

---

= PB =

"Only a man can suffer ignorance and smile" - Sting
(Englishman in New York)

[ Reply to This | # ]

EU Commission Study Finds You'll Save Money Switching to FOSS
Authored by: cc0028 on Friday, January 12 2007 @ 05:48 AM EST
Thanks for that, PJ. I have written to my local representatives asking for their reactions. A rough and ready translation goes something like:
Subject: Use of free software Text: Might I direct your attention towards the following report:

(URL).

In light of this report's conclusions, would your party put pressure on the Welsh Assembly, the British Parliament and the European Parliament as well as their administrative departments to make the fullest possible use of free software? And would your party set an example by using free software itself?

I would be happy to discuss these matters in more detail with you if you so desire, especially the technical aspects where I have a not a little knowledge

Peter

[ Reply to This | # ]

Free costs less....
Authored by: Sunny Penguin on Friday, January 12 2007 @ 06:53 AM EST
Microsoft should really get an acting award, the FUD about training costs and
change over costs, hides the fact that their software requires constant, serious
cash outlays for any business.

Linux or FreeBSD are truly "free" software in every meaning of the
word.

---
This message sent from a laptop running Fedora core 6 with Intel wireless
networking.
Everything works....

[ Reply to This | # ]

No Cheap Software for Me!
Authored by: Anonymous on Friday, January 12 2007 @ 07:36 AM EST
From the report :

Employees may perceive that their work is under-valued using 'cheap' OSS products.

This is a very important consideration. Where I work we know our boss values us because he has given each of us a Cray supercomputer as our workstation (emulating Windows 3.0, which we are used to). Notwithstanding that we have hundreds of unsealed copies of Windows Vista Enterprise version in the cupboard to make sure we are full covered in licensing terms - it is for our peace of mind, and we really appreciate it.

We each have a desk carved from ivory inlaid with a mozaic of solid gold, ebony and nacre, even though we are hardly ever in the office. Don't think we do not value the gesture though.

Out on the road on company business I am allowed to hire a 1965 Vauxhall Cresta (I'm in the UK) from a classic car company (and sometimes as a treat a 1982 Jaguar XJ-S HE). I'ts a very expensive hire, but it the model I learned to drive on, so it saves me re-training for a modern car. It often breaks down but I am tailed by a recovery vehicle all the time - my boss pays for that one out of his own pocket. He values us that much.

At every weekly office meeting our boss sets fire to a big pile of company money in front of us as a demonstration that we are valued above mere cash. In fact he holds the flaming mass in his bare hands. He also hammers a nail into his head for each of us. We all applaud his dedication

Lastly, the company sends off vast sums of money in our names to Bill Gates charity fund. We know that Bill will be a better judge of how to spend it than ourselves, as in all matters

[ Reply to This | # ]

Funny thing about re-training
Authored by: Anonymous on Friday, January 12 2007 @ 07:59 AM EST
Office-2007 is supposed to have a readically different interface that previous
versions of office.

So if re-training to learn the OpenOffice is such a big deal, then why isn't it
a big deal to to re-train to learn office-2007?

[ Reply to This | # ]

EU Commission Study Finds You'll Save Money Switching to FOSS
Authored by: ray08 on Friday, January 12 2007 @ 08:02 AM EST
Hey M$, GET THE FACTS! And a clue.

---
Caldera is toast! And Groklaw is the toaster! (with toast level set to BURN)

[ Reply to This | # ]

My first convert
Authored by: lightsail on Friday, January 12 2007 @ 12:35 PM EST
One of the young ladies in the office recently bought a new Acer laptop. She
needed to work with a Powerpoint presentation, but did not have any office
software on the system. She asked about MS Office. I explained OO.o, and
downloaded the installation files to CD.

the next day, she reported a successful install. She was pleased and looked
forward to learning the new interface.

Yes, this was a financially driven decision. The lower cost of OO.0 vs. MSOffice
made this happen.

---
Open source is in the public interest!

[ Reply to This | # ]

Possibly better perspective == what value for same cost.
Authored by: Anonymous on Friday, January 12 2007 @ 02:56 PM EST
I've found that arguing "what results for the same cost" works better in some organizations.

We recently had a budget for a relatively compute-intensive cluster where SQL Server Enterprise, some proprietary GIS softare, and related components were speced out. The result was our cluster would have about 5 higher end 4-CPU computers; and a lot of concern of the people in the project that this may not be enough for the processing they intended. We're now running the analysis using F/OSS (Linux + PostGIS) and it's looking like we'll be about to get 72 dual-CPU computers; all the software; plus software consultants to fill the gaps that any gap analysis finds; plus software consultants to tweak it even to be even more well suited to our needs.

So one presentation could have said

"F/OSS will save X% cost to get a similar system that'll almost meet your needs in the same way that the Windows plan would";

but it's turning out a more compelling presentation is

"For the same cost F/OSS will provide
  • 7 times more processing power (72 dual vs 5 quad CPUs) which will give us headroom for the next 3 years of growth - rather than starting with a system that will barely meet the needs.
  • more reliability (failover of wholy redundant servers rather than just internal SCSI/memory/etc failover in the 5 high-end servers)
  • consultants customizing the software components for our application "

    [ Reply to This | # ]

A disappointment, I think
Authored by: Anonymous on Friday, January 12 2007 @ 04:31 PM EST

I'm disappointed that reports like this seem to be focused so much on "cost of ownership," rather than other things that seem to me to matter much more. Like freedom. And, like improving the probability that you will be able to read documents created today 20 or 40 or 80 years from now, because the document was created using well understood standards that people had a commitment to continue supporting.

I haven't read the report - just my impressions from the summaries I've heard.

WB

[ Reply to This | # ]

EU Commission Study Finds You'll Save Money Switching to FOSS
Authored by: Anonymous on Friday, January 12 2007 @ 05:47 PM EST
Too bad the EU study contains a blatently wrong mis-interpretation of statistics. It says
Linux ... is used on 53% of servers of large companies [in Brazil] ... (See Figure 7)

Well, if you look at Figure 7 it does indeed show 53% for Linux; it also shows 88% for Windows, 23% for Novel, 59% for Unix, etc. They add up to 251%. Obviously bogus. We might speculate that the data really meant that 53% of companies had at least one Linux server somewhere, but that's not what they said. They said 53% of servers run Linux.

It's embarrassing.

[ Reply to This | # ]

  • Misreading the grapph perhaps? - Authored by: Anonymous on Saturday, January 13 2007 @ 04:59 PM EST
  • XEN - Authored by: Anonymous on Wednesday, January 17 2007 @ 01:24 PM EST
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