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LinuxWorld Summit: Linux Lowers TCO

"The Only Really Valid TCO Data Is Your TCO Data"

  • May 31, 2005
  • By Jacqueline Emigh

Organizations are finding that Linux lowers TCO (total cost of ownership) on both the desktop and server sides, but specific results vary according to the situation, said John Dobbs, principal strategist for Novell, speaking at LinuxWorld Summit in New York City.

IT administrators can use data from published studies to help gain internal backing for their own Linux deployments, suggested Dobbs, who pointed to studies by major analyst groups, as well as white papers by Linux users.

Yet it's also important to realize the limitations of some of this information, and to conduct your own TCO analyses in readying a Linux roadmap, the Novell strategist told attendees at the Linux show last week.

"Linux and open source are now in the mainstream. Have you defined your organization's strategy, business case and roadmap for open source adoption?" he asked. "The only really valid TCO data is your (own) TCO data."

Generally speaking, Linux offers a number of advantages over other operating environments, including flexibility, reliability, security, and "control and agility," according to Dobbs.

But cost savings are almost always the chief driver for implementation. Software solutions are more affordable, the same OS image can be run on a variety of hardware, and there are "fewer distinct OS to support" in a Linux environment, he maintained.

In one of the analyst studies described by Dobbs, Forrester Research asked companies, �What benefits do you get or expect to get from Linux and open source software?"

A total of 86 percent of respondents answered "low acquisition cost," while 77 percent replied, "low total cost of ownership." Other responses included "hardware choices" (49 per cent); "software choices" (41 percent); "better security" (31 percent);" "familiar to our developers" (24 percent); "higher quality" (24 percent); and "other benefit, not mentioned here" (16 percent).

In the desktop arena, one major medical practice has arrived at substantial TCO for desktop Linux in categories that include yearly operating costs along with "costs first year, including conversion," Dobbs said.

In the report, the medical practice weighed the costs of Microsoft upgrades and expansion vs. use of "thick" and "thin" Linux clients.

First-year costs amounted to $736,825 for Windows desktops, $644,000 for Linux thick clients, and $501,500 for Linux thin clients.

Yearly operating costs, on the other hand, came to $523,500 for Windows, $479,500 for Linux thick clients, and $359,500 for Linux thin clients.

In another study, Novell worked with the State of Indiana to determine the TCO of deploying 1:1 desktop Linux to 300,000 students and teachers statewide.

In the conclusions drawn, Linux would reduce computer acquisition costs by 40 to 60 percent, and support and maintenance costs by 66 percent.

Indiana has now decided to make Linux desktops available to all high schools throughout the state, although deployment won't be on a mandatory basis, Dobbs noted, in a follow-up interview with LinuxPlanet. [In that state, individual school corporations are free to choose their own IT systems, those Indiana officials are beginning to strongly advocate Linux for cost savings. -ed.]

Meanwhile, an analyst study from Gartner has shown greater cost advantages for "locked" desktop Linux than for its unlocked counterpart. For a 2,500-user environment with a mixed user base, TCO was $4,556 for locked Linux--and $5,481 for unlocked Linux--in comparison to $5,319 for Windows XP, $5,335 for Windows 2000, and $6,136 for Windows 95, for instance.

Gartner based its numbers on "unmanaged, fat-client desktops," with the following user base: 1 percent high performance users; 20 percent knowledge workers; 74 percent structured task workers; and five percent data entry workers. Migration costs for the OS and Office weren't included in the result.

TCO numbers can differ dramatically, though, from one study to the next, Dobbs said during his LinuxWorld Summit presentation, referring to a slide quoting IDC analyst Al Gillen.

"A wide variety of factors affect any TCO calculation: what function you're using Linux for, what kind of hardware (and how much of it) you're using, etc.," according to the IDC analyst.

"Variables - such as what distribution is in play and the version of Windows or Unix it's being compared with - make it impossible to plug numbers into a preset formula."

As part of its own study, IDC figured out TCO between Linux and RISC/Unix, in terms of US dollars per year, per user, for 1,000 supported users.

For RISC/Unix, TCO turned out to be $1,407 for collaborative applications and $684 for Internet/intranet/extranet. In contrast, TCO for Linux amounted to just $255 for collaborative applications and $377 for Internet/intranet/extranet.

In another study, Soreon Research came up with an overall TCO advantage of 29 percent for open source Linux vs. Microsoft Windows. According to this report, however, the savings came mainly in the areas of license/procurement and administration.

Conversely, Windows actually evidenced some cost advantages over Linux, in terms of support, training, and installation.

But in yet another report cited by Dobbs, the Robert Francis Group discovered that although initial costs of Linux can be higher at certain points, the ability to "massively scale Linux horizontally, without paying additional licensing fees," can yield significant cost savings over time.

In figuring TCO for a Web server implementation, RFG arrived at first-year figures of $49,931 for Debian Linux, $91,724 for Windows Enterprise Server, and $421,718 for Sun Solaris.

By year three, the numbers jumped to $74,475 for Linux, but they soared to $190,662 for Windows and to $561,520 for Solaris.

Costs considered included downtime; software licenses, maintenance and support; training; systems administrators, and discounts, if purchases were made in high volume. The study also accounted for 12 percent cost of capital and hardware depreciation over three years.

But many organizations haven't even embarked yet on Linux TCO studies. "Most companies today are using Linux somewhere. But lots of them don't really know what they're spending," Dobbs said, during the interview with LinuxPlanet.

In the Forrester Research study, for instance, fewer than half of the participating companies had a formal process in place to measure the financial impact of their open source choices, and merely five of the 14 had kept detailed metrics.

Dobbs also told LinuxPlanet that, even when organizations do implement Linux TCO studies, they sometimes inadvertently leave out areas of savings that could yield substantially lower TCO results.

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