Novell Assents To "Windows Is Cheaper Than Linux"

dyous87 points out a ZDNet article reporting that Novell has endorsed a customer's comment claiming that the total cost of ownership of Linux is higher then that of Windows. Novell and Microsoft jointly issued a press release quoting an IT guy for a UK-based bank, HSBC: "Some will be surprised to learn that our Windows environment has a lower total cost of ownership than our current Linux environment." The context of the comment makes it clear that HSBC's Linux environment has a mix of distros, and that a move to centralize around one distro — Novell's — will save money. Nevertheless, Novell's connection to this assertion is not likely to improve their reputation in the open source community.

its a bank

This is coming from a bank. They probably spent ridiculous amounts of money verifying linux is secure. They probably take microsofts word for it.

Re:its a bank

They probably got a ridiculous discount on Micro$oft licenses.

Anywho, I find most all TCO calculations to be dubious and akin to damned lies.

Re:its a bank

No,figures don't lie. But figures without a context are useless.

For example, I saw this commercial that said "Over 60% of Americans are now in debt". Which is a true statement. But when he used the word 'now' it makes sound like an urgent problem. like saying, "It's now Thursday."

But 60% of Americans in debt?? Oh wait, they were counting people who had a mortgage on a house, which most people don't think of as debt, but simply making payments on the loan.

Twisted out of context to hell and back? You betcha! Besides, everyone knows it's cheaper to run windows than linux. With windows, you sell your soul to microsoft as a down payment, thereby lowering the overall cost of enslavement...um...I mean ownership.

Re:its a bank

Sorry, have to post as AC as this violates the NDA I signed in good faith... lol...

Few outside HSBC are aware of the massive struggle that took place between HSBC and MS over the enterprise licensing agreement in 2005/2006. You need to realize that there is enterprise licensing and then there is Enterprise Licensing for a nearly 2 *trillion* dollar multinational. HSBC is that big.

When the previous agreement expired in 2005 (and in the months leading up to the expiry), Microsoft took a pretty hard line, issuing all sorts of memos about the "new licensing structure" which of course worked out to HUGE increases in enterprise agreements (and not just for HSBC, for the whole world - remember that?). HSBC also went in hard, even going so far is to make a global "announcement" that our new global standard for server architecture would be linux-based. I remember running complete bullsh*t "pilots" of applications which were obviously purely for the benefit of our local MS/VAR boys. Now there was never any real threat of a full-on conversion but just think about the impact of such a statement from one of the world's largest technology purchasers. Those of you involved in any sort of vendor renewal will be familiar with this sort of mexican standoff.

I wouldn't be surprised to find out that as the final hand$hake took place between MS and GroupHQ, the following exchanage took place:

  - MS guy: "Ohbytheway you really killed us with that whole switch-to-linux thing... Citigroup and GE renew in the next few years... would you mind issuing some sort of statement that downplays/refutes/minimizes your earlier linux announcements?"
  - HSBC guy: "Sure, how about 'Upon further review, TCO for linux >>> TCO for MS'?"
  - MS guy: "That'll do."

Oh and for those who think that HSBC is "just a bank" because it isn't quite so dominant in the US, you really have no idea.

And not just any bank

HSBC's long term TCO decision making strategies of late may be deemed... well... questionable [sfgate.com].

Mod AC up

HSBC is the very same bank that is most heavily exposed to the subprime market right now, which is under a lot of stress, needless to say. When I read the summary, I was thinking, "Yeah, HSBC sure knows how to save money..."

Re:And not just any bank

Not quite. http://www.hsbc.com/hsbc/about_hsbc/group-history [hsbc.com]
The history shows that the bank is anything but the basically the Chinese National Bank. It is currently listed in London IIRC

Re:And not just any bank

Just to clarify, since its published group history doesn't make it clear, the bank was founded in Hong Kong 140 years ago by Scottish white men. To this day, most of the Board members are white men of Scottish ancestry. For some interesting close to the truth fiction regarding the original creation of that bank, and the kind of Scottish men we're talking about -- read "The Noble House" by James Clavell (it's a very good novel -- that you won't want to put down once started).

Re:its a bank

This is coming from a bank. They probably spent ridiculous amounts of money verifying linux is secure. They probably take microsofts word for it.

Also, from TFA :

"Some will be surprised to learn that our Windows environment has a lower total cost of ownership than our current Linux environment."
HSBC claims it will achieve cost savings by reducing the number of Linux distributions it uses

So basically, they're saying it costs more to manage several different distributions of Linux than a single "distribution" of Windows... Well d'uhh. How about migrating all their Linux boxes to one distro, and then telling us it's harder to manage.

It's probably true.. who cares

If all you want is a machine to look at spreadsheets on, there's nothing wrong with windows. Hell, for a lot of people it's fine - if you're behind a firewall, who cares? The computer is just a tool to get the job done.

When you're looking at managing systems en masse, it's different, and it gets really different with servers - that's where microsoft's liscencing comes back to hurt them.

Re:It's probably true.. who cares

using debian i patched all of my servers in 15 minute, using a cute little script called apt-get

what's your point again?

Since Novell and Microsoft said this...

... it must be true!!

Three degrees of the severity of lies:

There are 3 degrees of the severity of lies:

Lies,
Damned Lies,
and TCO reports

-- Greywolf's Law of TCO

Novell is doing the logical thing

Ever look at a piece of modern art and think, "my kid could do that in five minutes?" Ever think why theater is too out in left field for you? Well there is a strong connection between modern art and Open Source.

Open source works and is great, but lets face the facts people in the open source community are not willing to pay money for software, or even software support. They expect it for free. Look at the bottom line of Redhat vs any closed source company. Their bottom lines are massively different.

So Novell, like the modern art community is saying and doing the things that PAYING CUSTOMERS or PAYING PATRONS expect. Modern art is not for the benefit of the general community because the general community does not buy art. Hence artists when they hear, "oh my kid can do this in five minutes" will laugh in your face because you critique as a non-paying person is completely irrelevant. Your opinion does not matter in the least. Likewise I think with Novell and Open Source growing apart, I think Novell is saying, "hey you folks are not paying the bills thus we are going to do what is best for our clients."

I can't blame them...

Forgot something

In the release, Matthew O'Neill, group head of distributed systems for HSBC Global IT operations, states that the bank's existing Linux environment is more expensive to maintain than its Windows environment. "Some will be surprised to learn that our Windows environment has a lower total cost of ownership than our current Linux environment." - they forgot to mention that the GNU/Linux environment consisted of 10,000 boxes and the Windows environment was only 3 boxes and 2 of them were down most of the time.

Ok, I just came up with this, but it's not different than what the 'article' is saying, there are no details at all, it's all just hand-waving and no facts.

depends on the SAs

I think this has to do with the SAs. Shops running mostly windows servers will have windows-saavy SAs. I say if you have a good linux SA, the TCO will be less for linux. If you have windows SAs doing linux, then of course TCO for windows will be less.

Where I work, we have had many more problems with our linux web servers than with our windows servers. I chalk it up to the fact that the team that manages our servers has WinTel in their group's name. Windows and Linux administration are two different skill sets. But somewhere along the line, someone decided that they'd rebadge a few windows SAs as linux SAs, which in my estimation, is a mistake.

Re:depends on the SAs

Exactly. Any decent linux SA will also have a higher pay as well, because it's not as common a skill as windows SA. Again, stereotyping here, but windows SAs hate the command line in general and keep their skills at "point and tick the right box, restart".
If you count the cost of your SA's pay, then yes, I would expect the TCO of linux to be a tad higher, if you omit the cost of windows licenses on the other side. Linux/*nix SAs in general know more of the underlying OS than their windows counterparts do, it's just a fact because of how the system works. Where windows provides GUIs for all aspects of configuration, *nix provides .conf files that you can edit by hand and get exactly the configuration you want in just the same amount of time, and with Linux, you don't need to reboot, just restart the service. More efficient and faster! Not user-friendly for a granny's desktop, but for a SA, whose very job it is to make sure everything's configured right, it is.
I haven't seen Vista, but XP and the little bit I've seen of Server 2003 all seemed very GUI based to me. There was an article about Windows finally receiving a decent command-line utility. Is Vista Pro going to get it so that SAs can actually do linux-style administration? Or is everything still going to be a mix of .ini files and registry keys to be activated using a GUI?

RTFA, again

In the article he is comparing the cost of a varied and diverse *nix mashup with a comparatively homogeneous Windows world. Sure, support a couple of versions of Windows versus 12 variants of Linux? Yep, cheaper. Fine. But the POINT is that standardizing on one Linux Will Save Money, compared to many versions, OR compared to Windows.

I'm torn

On the one hand, we OSS advocates can't afford to live in a dream world. If Windows is cheaper than Linux, we need to know about it, know why, and fix it. So from that angle I'm glad MicroNovell assented to it.

But we also know that statements like this are typically used out of context, especially by the professional liars who do advertisting for a living. Somehow, when MS runs ads talking about TCO, they'll forget to mention all of the qualifications that accompany this case study, such as the fact that it had a mixed Linux environment. So from this angle, I almost wish that MicroNovell hadn't assented at all, since it's likely to be used to mislead the general public rather than make them wiser.

Re:I'm torn

Your comments were well thoughtout, concise, and without hysteria or bias.

You must be new here!

So...

If HSBC thinks that Linux has a higher TCO than Windows, then why do they even have Linux machines?

The only reasons I can think of are that

• They have Linux-only apps that they can't run on Windows. (Is that likely? Perhaps someone here can shed some light on that matter.)
• Linux has a higher TCO, but is worth it.
• Linux had a higher TCO when using multiple distros, but after consolidating to Novell SUSE, they expect Linux's TCO to be below Windows'. TFA does focus on their moving to a single Linux distro to cut costs, but doesn't mention whether after that cut Linux will have a competitive TCO vs. Windows or not.

you forgot:

• They couldn't find enough data to make an educated decision so they tried to gather it themselves
• They found evidence that they though was convincing, so migrated, and then found out otherwise

Those are two more valid possibilities.

HSBC

... stands for Hongkong and Shanghai Banking Corporation

Hongkong and Shanghai are no longer part of the UK. You need to update your map (I hear Google has good maps).

zzz

in some environments, windows makes more sense than linux

in other environments, linux makes more sense than windows

the truth is bland and unexciting

linux zealots and microsoft ad execs may have more exciting things to say on the subject, but they're just deluded or lying

Applied Freudian Physchology

How the open source community views Novell is reminiscent of the madonna-whore complex.

1. We can only love a perfect(technically) and chaste(doesn't screw msft behind our backs) woman

2. However we want her to be sexy(successful) and do the nasty(make money).

In essence we can never be satisfied with a company's performance and also love them at the same time. We are doomed to hate Novell and yet we desperately want her.

Re:Applied Freudian Physchology

It has little to do with faithfulness or whatever other tortured metaphors may apply with respect to the open source community. To me, it has nothing to do with open source: I've lost faith in Novell because their "partner" has them talking down their own product. That's all I gotta say about that.

For SOME Windows is cheaper. For others not.

It's not hard to find specific cases where Windows is cheaper. The problem is when people use specific instances of cheaper TCO using linux or Windows to generalize which one is cheaper for other cases. It is easy to find specific cases where linux is the better option and others where Windows makes more sense. Finding examples however does not answer the question of which is more cost effective in general. I'm not sure there is a good way to answer that other than to assume that companies are rational enterprises and that they will gravitate over time towards to most cost effective solution. Installed base size might be the best available (albeit highly imperfect) measure if you accept the above premise. If linux is growing in market share, that might be rationally construed as evidence that companies are finding the TCO of linux to be lower. It's not the only factor of course but I think it is a reasonable inference.

For the desktop machines in my company which was cheaper depended entirely upon how we used the machines. We ran our servers on SuSE linux but for the desktop machines we needed specific applications where the linux alternatives were sufficiently inferior as to make them not cost effective. For our server needs there was no comparison, linux was vastly more cost effective. TCO is specific to the needs of the organization and/or individuals using the product. Its going to differ on a case by case basis and we would be foolish to generalize our needs to that of the IT community at large.

Old cost of 0wnership article

Not that long ago, there was an article about the cost of 0wnership (that first letter is a zero, not an o). It basically stated that it was cheaper to take control over a Windows computer than a Linux, and that by implication, it was more expensive to provide proper security for Windows than for Linux.

I wonder if Novel fairily included the higher cost to make a Windows system as secure as a Linux is.

Now, please note that much of that security is based on "security by unpopularity". However, if Linux were to become more popular, then the costs to find trained people and to pay them to support Linux would drop, probably just as much as the security costs went up.

Re:Old cost of 0wnership article

> Not that long ago, there was an article about the cost of 0wnership (that first letter is a zero, not an o).

The easiest way to disambiguate that spelling is spell it: "Total Cost of Pwnership"

(TCP might not be the best way to abbreviate it though)

I have a few questions on the grounds of such...

a statement.

TCO of Linux being higher than Windows wouldn't completely surprise me given my own personal experience with the OS, though hearing other people's experiences, I would not bet on either outcome. It, in several of it's incarnations, has given me more grief than almost any other OS I've used/administrated (there's only one worse I can think of, sorry /.ers, it's not Windows).

That being said, I'd still like to know -
is this weighted per machine on comparison, or per desktop in one set, per server in another, or is it just overall -
- If it's the latter, than TCO will be best on whatever system is used least.
- If it's the per server/per desktop, then it's a good measure
- If it's per machine, whichever has the highest desktop:server would probably win, so it's again unfair/biased.

Also, as it's stated, there are multiple distros; with how differently things are done, I wouldn't except a low TCO for multiple distros. My experience stems from 4 major distributions, totalling maybe 10-12 versions, the administration of different distros seems to be quite high, making multi-distro administration also a challange. That right there tells me this is biased against Linux.

Finally, learning cost: Learning is a sunk cost, and not an over-time cost. Was this TCO over the first year, or was it over a longer time? Did it involve a time-related cost projection? This is relevant because most of the users would have come in knowing how things were done in Windows, but not Linux, some of the admins may have even come in that way. The initial training cost would have been comparatively high compared to the new employee training cost - another VERY important factor that most likely biased this report against Linux. Anyone know if they actually put up facts about this?

A lot of words said and conclusions made in TFA, but at the end of the day, I don't feel any more educated than before - they just gave no useful or novel (/new/ not book or corporation) data.

Partly true

As with many things, when you save money it doesn't necessarily mean you've got more "money in the bank" it just means you have more to spend on other things. Where I work we're a mixed windows/linux shop, and moving more towards the linux/FOSS route all the time.

Does that mean money saved overall, no. What it does mean is that money that would have been spent on X (software licenses, etc), is now spend on other stuff (aging infrastructure, upgraded network, etc and lots of other things that would have otherwise stay or been delayed in upgrading). There will always be places to dump cash, and what most of these studies don't seem to incorporate into the "studies" is that dollar for dollar, the spending might be the same or more for FOSS, but the results might not be the same nor what the money was spend on.

TCO of Williams FW29 is more then a Vespa!

The point being?

No credibility, since msft paid novl over $100M

It's hard to take anything novl claims about msft seriously. This seems like more bought-and-paid-for msft brown-nosing. Very similar to the all the bogus "think tanks" that msft bought, or all of silly msft sponsored astro-turfing, or all the phoney-baloney msft sponsored TCO studies, or all the msft paid analysts that gush over msft. And doesn't msft pay bloggers, and message board posters?

Frankly, I don't see how any reasonably well informed person can believe anything positive published about msft. Msft pays for good PR in every way imaginable.

TCO calculations

Great, now we know that the TCO for a mixed Linux environment is higher than for Windows. And what does it mean?

Did they calculated the costs by taking the productivity of their personal into account, the increased security risks and possible costs for disaster recovery ( like an employee responsible for account creation, who had a keylogger installed, yesterday news http://it.slashdot.org/article.pl?sid=07/03/14/133 0215 [slashdot.org])?

What does it really mean, if you don't get the details of the entire installation and their calculation? Training people on new software is certainly the biggest costs, training people on a closed source system just means that security is controlled somewhere else and that users will not understand, can not understand and will make errors, which put your business at risk.

Sure, Linux can be attacked as well, but once there is a critical bug known, you can react by getting a patch, disable that part or write your patch yourself (not that I could do it, but a programmer employed by a bank...)

Much better than a "patch/nopatch tuesday".

Banks, mucho money, mucho incompetence.

I wouldn't put much faith in the ability of HSBC to manage anything IT related. I work for a company selling trading software to top tier banks, many of them based in the UK. Overall, their IT staff are useless. Their seems to be two type of bank IT staffer - the permanent staff hired straight out of college, with no real world experience and no chance of acquiring any because the second kind of staffer, the contractors, do as little as possible but ensure their own job security by keeping the permies as ill-informed as possible.

This may sound cynical, but it is all too true. As an example, we had an IT person from one bank try to apply an update to their system by first untarring it on Windows and FTP'ing each file in turn to the Unix box. In the process they managed to change the case of all the files. This was despite the release notes (complete with cut 'n' paste, step by step instructions) telling them to apply the patch by untarring it on the Unix box.

Another example is a client who has switched from HP-UX to Solaris and now to Linux within the space of a year. With that kind of regular platform jumping it's no wonder this clients Windows TCO is lower than the one for Unix.

how to reduce TCO the HSBC way ..

'In 2004, financial group HSBC launched an initiative to reduce the cost of supporting 300,000 desktop computers by 20 percent through rigorous standardization. To help achieve this goal, the company deployed Microsoft ® System Center solutions as an integral part of its new environment. Microsoft Systems Management Server 2003 facilitates centralized software deployment, roaming user desktops, and the ability to track software usage to the individual user'

'To date, HSBC has realized an estimated U.S.$50 million to $75 million reduction in annual costs--expected to increase to $100 million [microsoft.com] by the time deployment of the new desktop standard is finished at the end of 2007

How can you save money by spending it on another system to help you manage a system that is supposed to be easily managed in the first place - Active Directory.

How does the Windows environment have a lower TCO than Linux. Do they have keep the Linux admins in a separate part of the building. Aren't they allowed to admin the Windows boxes. Do they cost more. Do the Linux updates take longer.

Look at the TCO

I have to disagree. After you purchase Windows then start adding on all of the other necessary software to run a enterprise Windows environment such as Ghost, Backup Exec, Disk keeper etc. and then tell me if it is cheaper than Linux.

How likely is it they are correct?

Let me quote two Gartner studies:

IT services for open-source software represent 1.2% or $2.3 billion of the addressable 2006 North American IT services market.

- Report Highlight for Dataquest Insight: Open-Source Software IT Services, North America, 2005-2010

Across all organizations, one-fifth say they use OSS. As few as 17 percent of midsize and large respondent organizations say they use OSS, and 28 percent of organizations of 500 to 2,499 employees claim they use OSS.

- User Survey Report: Open-Source and Linux Software Support Services, North America, 2006

OSS services account for 1.2% of the IT budget, yet 20% of larger companies use OSS? So worst case, if less than 6% of the average company's software is OSS, then MS/NV are correct. If greater than 6% is OSS, then they are obviously wrong - due to OSS's relatively small market share.

TCO is Meaningless

TCO is Meaningless. There is no accepted measure of TCO. It is not a normal accounting procedure and it appears to have been developed in the computing industry probably by Microsoft.

There is a real accounting procedure used by corporate accounts that could provide a comparison and that is Return on Investment (ROI).

Cost of Linux or cost of applications

I have foun