Bargain hunters love Linux

There’s a good reason that institutions are moving to Linux, users say: it’s cheap.

Software management and acquisition costs can be slashed by switching to open source software, according to IBM executives and Linux customers who attended an IBM-sponsored event held on Tuesday at the LinuxWorld Conference and Expo in San Francisco. Obviously, a Linux convention is not the sort of place where one would expect companies to enumerate the virtues of, say, Windows, but they admit that they are seeing tangible benefits.

Nyfix, a New York company that manages brokerage trades, expects that Linux will help it reduce software-associated operating costs by 80 per cent in two years, said Jim Strasenburgh, vice president of systems at Nyfix. Until recently, the company relied primarily on Unix servers.

"We are going to save substantial amounts of money," he said. "There are no internal discussions on where we need to go."

Similarly, the government of Taiwan plans to expand its use of Linux. Right now, Linux accounts for about four or five per cent of the software that the Taiwanese government deploys, Dr Ching-Chi Hsu of the Open Systems Association of Taiwan said. That figure will increase to 30 per cent in the next three years, he said.

While Linux adoption initially took off with academic and government institutions, the customer base is broadening to include small businesses and large corporations. But the operating system is still primarily used on servers and workstations.

Interest in versions of the Linux operating system that are tailored to desktop PCs will increase as familiar brands and applications get rewritten for Linux, but the process will take time, said Irving Wladawsky-Berger, general manager of IBM’s e-business on demand. Deals like Novell’s bid to buy Ximian will also help.

"There is a strong build-up of interest, but I don’t think this has quite achieved escape velocity," Wladawsky-Berger said.

Michael Kanellos writes for CNET News.com