The open-source buzz has been heard in corporate IT departments for a while now. But lately, Main Street mom-and-pops are listening, too. A recent Jupiter Research survey shows a growing number of small and midsize businesses (SMBs) using open-source alternatives to Microsoft (MSFT) products. About 9% of SMBs are using Red Hat (RHAT) Linux on the desktop, and 7% are using the OpenOffice productivity suite, which contains word processing and spreadsheet programs.
The numbers may not be huge, but David Lee, CEO of Cambridge (Mass.)-based Advent Consulting, sees potential. An entrepreneur himself, he started his consultancy in 2003 to help SMBs make the transition to open-source technology. He has already seen revenue grow substantially in the past year. BusinessWeek Online reporter Erin Chambers recently spoke with Lee about why more small outfits are cutting costs by jumping on the open-source bandwagon -- gradually. Edited excerpts of their conversation follow.
Q: Why do you think open-source technology is a valuable option for small-business owners?
A: It's quite simple. In terms of acceptance by the SMBs, the price [and no licensing cost associated with these applications] makes it very easy for smaller companies to adopt. They find low risk in the deployment of open-source solutions, and since it's already being validated by large corporations like IBM (IBM) and Oracle (ORCL), it's very attractive to them right now.
Actually, there are a number of ways you can charter a very successful open-source business strategy. Our business primarily focuses on trying to deliver a custom solution using an integration of hardware, software, and support and maintenance, especially for SMBs. These companies, they don't really have enough resources to try and tackle these areas. So we find a niche facilitating the open-source adoption -- and at the same time try to help them.
Q: Let's say I'm a small-business owner and want to switch my IT operations over to open source. What are the steps I need to take?
A: Because there are many different open-source technologies out there, it's difficult for anybody to understand which is the best one available for their needs. We have been doing this type of integration, consulting, and migration services for SMBs. We will come in and try to understand their requirements. Then we offer them some kind of guided process and help them gradually migrate over to the open-source technology.
In most of the cases we've been through with smaller clients, they want to find the quickest way to adopt open source at the lowest cost and also at the lowest risk. In certain instances, like in the Microsoft Office application, we say: "Let's try to take half of your Microsoft Office users and migrate over to OpenOffice." Once they feel comfortable, they gradually move [the rest] over. Smaller companies don't want an interruption to their regular business process.
Q: What are the biggest challenges in selling small-business owners on the open-source concept?
A: Open-source technology is pretty well-validated by its large enterprise customers. But smaller outfits are still not aware it's available to them affordably, and it can be easily customized to their internal business-process needs. So we have been trying to give them an understanding about available open-source technology and gradually help them to look [at] cost -- that they can save a lot of money by not using the proprietary or closed-source software with licensing issues.
The other challenge we have faced is they don't feel comfortable that they can find the necessary support after they adopt it. That's where we come in, because we offer the complete end-to-end solution. Once we implement it, we have the resources to provide the continuous maintenance and support on their behalf. And that's what the smaller companies are looking for. That's where we find our niche.
Q: Do you believe open source in the small-business market is poised for continued growth?
A: We see more small companies adapting to open-source technologies in the future. There's only more demand for our services. Especially with the support and maintenance aspect we offer, we have a lot of potential. The major vendors already have the infrastructure and process in place to facilitate that, but that's from the vendor perspective. From the customer perspective, we can handle those resources for them if they don't have the internal structure set up.
Q: Will the transition to open source be attractive for all types of companies in the future?
A: Yes, it may. But I would say for the most part, it's for technology-related businesses. We also provide customization and integration with the customer's internal proprietary and closed-source applications, so we do see that there's going to be some kind of hybrid organization in the future, since Microsoft and other closed-source software is not going away.
But in terms of open source, it will take a more visible role in the internal IT environment, so we anticipate in the next three to five years, there's going to be some type of hybrid environment with both open and closed source. That's why we're here.