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Linux Business

Linux To Ring Up $35B By 2008 212

Posted by michael from the money-in-the-bank dept.
al@opensourcebrowser.com pastes "For a theoretically free operating system, Linux is -- and will continue to be -- a cash cow, a research firm said Wednesday as it predicted the OS will bring in more than $35 billion in revenues by 2008. Framingham, Mass.-based IDC said that overall revenue for servers, desktops, and packaged software running on Linux will reach $35.7 billion in the next four years."
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Linux To Ring Up $35B By 2008 More

Linux To Ring Up $35B By 2008

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  • I write OSS for Linux (Score:5, Funny)

    by Limburgher ( 523006 ) on Sunday December 19, 2004 @07:21PM (#11133571) Homepage Journal
    So, where's my check? :)

    • So, where's my check? :)

      You need to go get your product into wide use now. On one project [citadel.org] I'm involved with, we're working with a certain .com on a project I can't say much about yet, but we're going to give a certain Microsoft product a run for their money, using open source software. I don't expect any of us to see money from the project for at least two years, though you can bet you'll see the product -- when it's ready -- on the front page of slashdot. :)

      In the meantime, keep maintaining your soft

    • Ah ha! It IS a conspiriacy.

      I've got it: Linus and Stallman are in cahoots, and they're cashing my checks!!

      ;-)

  • BUT WINDOWS IS CHEAPER!!! (Score:5, Funny)

    by Anonymous Coward on Sunday December 19, 2004 @07:22PM (#11133575)
    GET THE FACTS! [microsoft.com]

  • Errrr, Dupe (Score:4, Informative)

    by MrWim ( 760798 ) on Sunday December 19, 2004 @07:23PM (#11133586)
    See here [slashdot.org]
  • ..anyone who can figure out where that figure came from, and who's getting it...

    • Re:Karma points to.. (Score:4, Funny)

      by Anti Frozt ( 655515 ) <{chris.buffett} {at} {gmail.com}> on Sunday December 19, 2004 @07:27PM (#11133605)

      Hopefully not the RIAA; otherwise, I would peg the revenue estimate at around $20.

    • Pulled out of someone's ass of course -- along with TCO figures saying that Windows beats Red Hat Linux.

    • Re:Karma points to.. (Score:5, Informative)

      by goon america ( 536413 ) on Sunday December 19, 2004 @07:29PM (#11133618) Homepage Journal
      From the article:
      The numbers are higher than earlier estimates by most analysts, in part, said IDC, because it changed it methodology to account for not just Linux on new hardware, but also Linux that's redeployed on existing hardware, and even cases when the open-source OS is used as a guest operating system, such as in a server partitioned with virtualization software to run multiple OSes.

      So, not only are they counting the hardware that linux is running on as being "spent on linux," they're also counting existing hardware on which linux will be installed as being "spent" on linux as well.
      • as i understand it, they are counting hardware that was not *purchased* with linux installed:
        In many cases, a linux server will be purchased without an OS, as each administrator will simply install his favorite distro from a cd or the net.
        It is however, correct to count this hardware as linux hardware.

      • So, not only are they counting the hardware that linux is running on as being "spent on linux," they're also counting existing hardware on which linux will be installed as being "spent" on linux as well.

        Spend once, expense twice? Linux really has grown up in the corporate world!

      • So in other word, the article is a deceptive propaganda piece. I think I got that from the capsule summary, but I still wanted to read the comments to see what /.ers think.

        -a
      • "So, not only are they counting the hardware that linux is running on as being "spent on linux," they're also counting existing hardware on which linux will be installed as being "spent" on linux as well"

        I don't know what's sadder. That you misread the quote and posted such a misinformed statement, or that 4 people decided to moderate you up and nobody that replied seems to be able to read the statement any better.

        Lets look at the quote from the article:

        The numbers are higher than earlier estimates

  • $358 (Score:5, Funny)

    by Anonymous Coward on Sunday December 19, 2004 @07:24PM (#11133593)
    I saw $358 and was not surprised.
  • i presume most of this is from donations because the ISO's can be downloaded free. so if linux is turning into a cash cow just by being a free software, then think how much it would have made by being a commercial one... ha! ha! got ya... it would have made quite less as its appreciation comes from its FOSS tag, right?! now that's what i call paying for what you like and not what your vendor insists... more power to FOSS.

  • $35.7bn? (Score:5, Funny)

    by Nine Tenths of The W ( 829559 ) on Sunday December 19, 2004 @07:28PM (#11133616)
    Wow. That's a lot of SCO licenses.
    • Yeah, but if you look at title that says "Ring Up". That's even more ringing:)

      p.s. Does anyone know how much can one hour of ringing bring???

  • And yet... (Score:4, Informative)

    by elid ( 672471 ) <eli.ipod@g m a il.com> on Sunday December 19, 2004 @07:29PM (#11133624)
    ...Microsoft generates $10.6 billion in annual revenue from Office alone.

    (source [reuters.com])

    • Re:And yet... (Score:2, Interesting)

      by SoSueMe ( 263478 )
      Yes, and Openoffice.org rings up significantly less because... it's free.
      It does most of what the higher priced software for "Office Productivity" users need.
      Comparisons between closed, propreitary, for profit, software and sales of prepackaged support releases are not a benchmark of quality or popularity.
      • Unless you're on Mac OS X, in which case the only option. (Unless you like long start times, lack of HIG compliance, and an ugly, unmatching interface.)

  • And Its Net Economic Benefit Is Even Greater (Score:4, Insightful)

    by geoffrobinson ( 109879 ) on Sunday December 19, 2004 @07:33PM (#11133652) Homepage
    Linux allows companies and individuals to use their money in other areas as well. This helps the economy overall. Cell phones on Linux will be cheaper, etc.

    Also, companies can use that money in other areas, which I would assume would make them more productive.

    A lot of this revenue is probably for services I would assume.
    • More simply put, economic strength is measured by the amount and quality of goods and services produced and provided. It is denominated in goods and services, not dollars.

      Computer maintain their contribution to economic strength, if not increase it [since Linux does things better]. At the same time, more resources are available to make other goods and services, since resources previously diverted to Microsoft are in the control of consumers and the state (state for tax money, consumers for what is left ove

  • RMS just called (Score:2, Funny)

    by Anonymous Coward
    He says the correct figure is GNU/$35B

  • Is it much? (Score:5, Interesting)

    by asac ( 643533 ) on Sunday December 19, 2004 @07:35PM (#11133669)

    Microsoft will earn $38 bn [computerweekly.com] in 2005.

    IBM received $23.2 bn [com.com] in 2004.

    How will those figures look in 2008?
    • Revenues vs. profits. Your numbers are probably profits (revenue minus cost).

    • Re:Is it much? (Score:2, Interesting)

      by nagora ( 177841 )
      Those figures are not comparable: Microsoft's is for the year, IBM's is for the quarter. IBM's consulting devision takes in more than then whole of Microsoft. IBM can't match Microsoft's profit margin, though, so MS is still the richer company. But I'd bet on IBM still being around in 50 years when MS is long gone.

      TWW

  • Warning (Score:5, Insightful)

    by Ars-Fartsica ( 166957 ) on Sunday December 19, 2004 @07:36PM (#11133675)
    These are the same people who claimed B2B sites would be transacting $10 billion a year by 2006 whilst praising ATM networking, 3G networks and AOL.

    Yet the same people completely missed portable MP3 players, VOIP, etc etc

  • Don't count your money before it's made. (Score:4, Funny)

    by SetupWeasel ( 54062 ) on Sunday December 19, 2004 @07:38PM (#11133687) Homepage
    Didn't we learn anything from 4 years of George W. Bush?
  • FreeBSD is responsible for over $1B in revenues, today. If it could be accurately counted, it might be over $2B. Yup, it's dying, all the way to the bank. ;->
    • Considering a fair portion of OS X is based on FreeBSD, I think you could argue for a much higher number than that.
      • Good point, but, how much of Apple's revenue stream could you honestly attribute to FreeBSD? An interesting question. How much revenue can be attributed to the GNU stream? //hint: an aspiring economics student could really make a name for themselves exploring this.
        • I don't know the answer to the question of revenue derived from any particular piece of open source Apple uses (like Apache or CUPS or FreeBSD or all the rest), but an interesting observation is this:

          While Microsoft struggles to get Longhorn out in 2006, Apple is beating them (with far less manpower or monetary resources) on almost every point with an OS out in (early) 2005! Apple, more than any commercial company I have seen, is leveraging Open Source as much as possible to expend all of its energies on
  • Only 2 million copies of Redhat Enterprise Linux for zSeries, and we're there...

    http://www.redhat.com/software/rhel/purchase/index .html [redhat.com]

  • TCO! (Score:5, Funny)

    by Dark Paladin ( 116525 ) * <jhummel&johnhummel,net> on Sunday December 19, 2004 @07:41PM (#11133707) Homepage
    [sarcasm]
    See! Windows is a lot cheaper than Linux - I mean, look how much money you have to spend on it!

    Hm? How much would it cost to do the same thing with Windows? That's not the point - look! Shiny object!
    [/sarcasm]

  • don't need me anymore (Score:5, Insightful)

    by ToasterTester ( 95180 ) on Sunday December 19, 2004 @07:41PM (#11133709)
    Well with that much money guess they don't need us writing free code anymore. They can afford to pay and spread the wealth.
    • Hey now, dont start falling for it. If you really think about it, this could be a big wedge set up between the lone developer and the big community. The big guys waving fat wallets and the little guys waving bug fixes. The self-healing nature of the OSS community probably wont let that happen, but it woulndt hurt to be wary because it seems like a weak link in the chain that holds it all together.

      Sure we dont get paid, but we do love what we do. The whole satisfaction bit comes from the sense of accomplish
      • "Sure we dont get paid, but we do love what we do. The whole satisfaction bit comes from the sense of accomplishement and contribution to a greater good."

        The greater good seems to buying mansions for resellers or at least shiney new cars. So you work for free o something that other people make money off of. I need to find some people interested i the greater good of my lawn care.

  • This is what happens... (Score:3, Funny)

    by donnz ( 135658 ) on Sunday December 19, 2004 @07:50PM (#11133764) Homepage Journal
    ...when communists go bad

  • Actual revenue for 2004 is $15 billion (Score:5, Interesting)

    by Animats ( 122034 ) on Sunday December 19, 2004 @07:50PM (#11133768) Homepage
    More interesting is the actual value for 2004 - $15 billion.

    That's a nice number, Note that in comparison, Microsoft's 2004 revenue is about $36 billion. Apple is around $10 billion.

    • Re:Actual revenue for 2004 is $15 billion (Score:2, Informative)

      by Anonymous Coward
      fyi the 34b figure for 2008 and 15 for 2004 includes everything - like the price of the actual hardware, transactions run thru the system etc.

      if you'd do this math for MS it would be a lot higher, ibm would most likely win with all the transactions in banks going over them

      • Re:Actual revenue for 2004 is $15 billion (Score:4, Interesting)

        by Animats ( 122034 ) on Sunday December 19, 2004 @10:41PM (#11134625) Homepage
        True. Red Hat makes about $150 million per year. That's revenue. Profit is about $5 million per year. Which is not much, considering that Red Hat didn't have to pay for the development of Linux.
        • ...everyone can compete on equal tersm with Red Hat. Think you can offer better or cheaper support? Just do it. OSS software differs quite a lot from closed source software. In closed source software, you typically *spend* a lot of money on R&D, then *make* a lot money off the product.

          In OSS, you don't need to spend a lot of money on R&D as such, but you don't get to sit there and milk it later either. You have to offer something continously in order to sell service and support. Red Hat can never s
        • Not quite - Red Hat have always poured huge amounts of money into Linux development. I suspect their profits have not kept pace with their revenues because their desktop team has grown enormously in 2004. It must have quadrupled in size, at least. At least that's my estimate taken by looking at the rate they were hiring community figures and knowledge of the size of their desktop team a few years ago.

          So I wouldn't read too much into the RH figures.

    • Re:Actual revenue for 2004 is $15 billion (Score:4, Informative)

      by gregorio ( 520049 ) on Monday December 20, 2004 @05:54AM (#11135865)
      More interesting is the actual value for 2004 - $15 billion. That's a nice number, Note that in comparison, Microsoft's 2004 revenue is about $36 billion. Apple is around $10 billion.
      The 15 billion figure is the *total* direct and indirect profits *related* to Linux. Including Hardware.

  • Kinda misleading (Score:5, Insightful)

    by Anonymous Coward on Sunday December 19, 2004 @07:56PM (#11133798)
    They're counting money for hardware that would have been spent anyway, regardless of what OS is running on it. It's like a car company taking credit for $35 billion spent on gas. In the end, if I don't buy a Honda, I'll buy a Ford and spend money on the gas regardless.

    The only credible argument is that less will be spent on hardware supporting Linux than would be spent supporting other operating systems. Perhaps, that's an arguable point. But even then, the cost difference would not be $35 billion.

    • Re:Kinda misleading (Score:3, Insightful)

      by 808140 ( 808140 )
      In a way, I want to agree with you. But I'd like to point out where your Ford/Honda/gas analogy breaks down: interfaces.

      You see, good hardware is very important in a purchase decision. However, hardware on its own is not particularly useful, nor does it sell particularly well -- you'll note that it's rather hard to purchase systems independant of an operating system.

      While a Windows server and a GNU/Linux server may run on the same hardware, people are buying the servers running GNU/Linux, rather than t

  • I see they discovered the secret formula!! (Score:5, Funny)

    by Dano Watt ( 841769 ) on Sunday December 19, 2004 @07:58PM (#11133813) Homepage
    You know, the three step program.

    1) Distribute OS for free
    2) ???
    3) Profit!


    All successful companies follow it, and so far, it hasn't failed yet.

    In other news, beating dead horses has reached an all time high.

  • Cash cow? (Score:4, Funny)

    by daishin ( 753851 ) on Sunday December 19, 2004 @08:34PM (#11133963) Homepage
    Its a cash penguin damnit!
    • OK, if the cow-dog of the Macintosh says "Moof!", what does the cow-penguin of Linux say?

      Quackoo? Mooack?

      It's these kind of issues that confuse pointy-headed bosses untill they decided against implementing Linux! We must find the answer if Linux is to continue to gain popularity!

      Maybe "Mackoo"???

  • Software Sells Hardware (Score:4, Insightful)

    by stankulp ( 69949 ) on Sunday December 19, 2004 @08:49PM (#11134021) Homepage

    IBM said it first, but it's still true today.

    You don't buy computer hardware because of its architecture. You buy it for the software it will run.

    Linux runs just about any sort of application you could desire, it's free (as in speech, not as in beer), but businesses have to buy hardware and hire IT people to run it.

    IBM used to give the software away for free to get people to buy the iron.

    The more things change...

  • Wow, back on the 15th is was only 28 billion (Score:2, Interesting)

    by Anonymous Coward
    timothy post [slashdot.org]

    How about some DISCUSSION on Linux related stocks? It seems the only serious player is IBM who markets both SUSE and RedHat. SUSE DB2 IBM power 720, whipped the pants off SUN recently in TP benchmarks. There has been speculation that Sun will make a play for either RedHat or Novell. Even though market caps of Novell and Redhat are similar, I doubt Sun's 6billion cash will be enough to buy Novell and S.M. won't give up more than cash. If Redhat folks don't have some decent takeover protection
    • Dell seem to make good money off of Linux as well, supporting both RHEL and SLES on their server lines and their N models of desktops.

      Sun are in a bad place at the moment, and Solaris 10 x86 HAS to succeed for them to make it through the next 3 years. But they still sell a lot of Red Hat, despite their rants about it.

      Red Hat have some problems. Their pricing is high for the service they deliver, their products are buggy or incomplete in many cases (config tools, etc.) and they're not great with release da
  • I guess now would be the wrong time to tell them it's free, right?

  • I wonder.... (Score:3, Funny)

    by blair1q ( 305137 ) on Monday December 20, 2004 @01:10AM (#11135220) Journal

    Do you think Linus Torvalds looks at that $35 billion valuation for Linux and thinks, "I wish I'd invented that..."
    • My guess is Linus would answer "No" to your question.

      Linus had a very nice life - hacking on what he wants how he wants, when he wants and where he wants. He's healthy, warm, clothed and fed, as are his wife and children.

      Some people just don't need any more than that.

      Soko

  • In real terms (Score:3, Funny)

    by SuperBigGulp ( 177180 ) on Monday December 20, 2004 @02:51AM (#11135464)
    $35B as in Beer?

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