Study: Open-source software can boost EU economy

European companies are saving a lot of money on software investment and development, due to the existence and emergence of open-source software, a Commission-funded study finds.

DG Enterprise commissioned a study on the economic impact of so-called Free/Libre and Open Source Software (FLOSS) from a research consortium led by the United Nations University’s Maastricht Economic and Social Research and Training Centre on Innovation and Technology (UNU-MERIT). The study is a follow-up to the 2002 FLOSS survey and study, partly prepared by the same source. 

The report finds that, in Europe: 

  • FLOSS market share in Europe is the highest worldwide, with FLOSS applications ranking among the first three in the markets for web servers, server operating systems, desktop operating systems, web browsers, databases, e-mail and other ICT infrastructure systems.
  • FLOSS penetration is also among the highest worldwide. The bigger a company is, the more likely it is to use FLOSS.
  • Europe is the number one place worldwide for open-source software developers, ahead of North America and Asia. Most FLOSS businesses are still based in the US, but EUrope is quickly catching up, in particular with many small- and medium-sized firms.
  • The value of quality-controlled Open-Source code available is estimated at €12 billion, with a doubling expected every 18 months to two years.
  • The open-source-related economy (firms that contribute to open-source development) represents 565,000 jobs and €263 billion in annual revenues. 
  • FLOSS-related services could reach a 32% share of all IT services by 2010, and the FLOSS-related share of the economy could reach 4% of European GDP by 2010.
  • FLOSS directly supports the 29% share of software that is developed in-house in the EU (43% in the US), and provides the natural model for software development for the secondary software sector.
  • FLOSS potentially saves industry more than 36% in software R&D investment that can result in increased profits or be more usefully spent in further innovation. 

The study can be seen in the context of an ongoing trench war between Microsoft and open-source companies on the economic impact and ‘Total Cost of Ownership’ (TCO) of open-source applications such as the popular Apache web sever, as compared to rival products such as Microsoft’s Windows Server.

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