Why open source
software matters toyour enterprise
The business pros and cons of open source software

The TODO Group (European Chapter) | September 2020

www.linuxfoundation.org

Executive summary
Open source software has proven to be so vital tobusiness success that it is commonly used and publishedby companies focused primarily on shipping proprietaryproducts. Today, IBM owns open source software giant
Red Hat, at a purchase price of $34 billion, and Microsoft
bought GitHub, the largest host of source code in the world,
for $7.5 billion. These hefty investments and forklift-sizedtechnology changes are based on solid business cases
rather than mere whims or trends. It’s an indication ofsignificant changes in business strategies and businessmodels. Two examples are highlighted in the sidebars.
There are many business reasons to use open source
software. Many of today’s most significant businessbreakthroughs, including big data, machine learning, cloudcomputing, Internet of Things, and streaming analytics,
sprang from open source software innovations.

Why open source software matters to your enterpriseOpen source software often comes into an organization
as the backbone of many essential devices, programs,platforms, and tools such as robotics, sensors, theInternet of Things (IoT), automotive telematics, andautonomous driving, edge computing, and big datacomputing. Open source software code is working on
many smartphones, laptops, servers, databases, andcloud infrastructures and services. Developers build
most applications by leveraging frameworks like Node.
js or pulling in libraries that have been tested andproven in many production use cases. To use almost
any of these things is to use open source software in
one form or another, and often in combination.
It also hastens innovation. Often, internal developers
contribute and maintain code in open source software
projects on behalf of their employers and sometimes

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as a hobby project. In terms of career development
and earned social reputation, developers’ attraction
to work on open source projects is so compelling thatyou may be losing developers to competitors who moreaggressively leverage open source software. Further,companies that allow and encourage developers toparticipate in the open source software community
during business hours tend to recruit and retain thebrightest talent, even in a tight labor market. In atestament to the popularity of open source software
among developers, there were over 40 million
developers on GitHub in 2019, 10 million were newusers, according to GitHub’s annual Octoverse Report.
By using open source software, companies also avoid
building everything from the ground up, saving time,money, and effort while also rendering more innovationfrom the investment. Open source software is generally
more secure than using the commercial proprietary
counterparts too. That is due in large part to thecollaborative nature of open source software projects.
A common phrase used by Open Source developers
and advocates is that “given enough eyeballs, all bugs
are shallow.” That holds so long as there are “enougheyeballs,” which, given open source software’s adoption
rate, may be challenging to have across all projects.
Drawbacks do exist, as no software is perfect, not evenopen source software. However, for most organizations,the good far outweighs the bad. The codebase’s open
nature also means it’s easier to report and fix software
versus alternative models.
While open source software offers many reliable andprovable business advantages, sometimes those advantages
remain obscure to those who have not looked deeply into
the topic, including many high-level decision-makers. This
paper aims to provide a balanced and quick overview ofthe business pros and cons of using open source software.

[Barcelona] underscores its commitment tospeeding smart city innovations by its “useand promotion of Free Software and open
technologies as a social good, to enable
collaboration between administrations and to
escape vendor lock-ins...”- Free Software Foundation Europe (FSFE) ReportWhy open source software matters to your enterprise

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What is open source software?
Open source software means computer source codethat is made publicly accessible and can be modified,and shared. “Open source software” began as a
descriptive term of this specific approach to software
licensing and development. Under the Open Source
Definition created by Open Source Initiative (OSI),
the term no longer implies simply access to code, butalso adherence to distribution, licensing criteria, andcommunity spirit and collaboration.
Initially, open source software was created bydevelopers as an alternative to closed softwaredevelopment and distribution models they foundto be lacking in one aspect or another. Today, open
source software has matured to include an array ofbusiness models with a solid and highly competitivemarket presence. As is typical of a thriving and evolving
industry, open source software programs, platforms,
and open source software-based companies are being
acquired as industry players begin to converge.
Today, open source software is mainstream acrossall business verticals. The open source software
collaborative model has matured beyond individual
developer collaborations to large and competitivecompanies collaborating to resolve common issues
and develop shared solutions. Today’s challenges
are often too large for any company or even several
companies working together to solve. The best practice
is building large and open source software ecosystems
to collectively address multiple parts of the puzzle.
This open but highly organized sharing of resources
and knowledge eliminates many common industry
obstacles and clears the way for competitive, innovativedevelopment.
In recent years, the trend of competitor collaborations
within a single industry has led to the development ofindustry-specific open source software projects andfoundations to produce commodity software. Twoexamples are the Academy Software Foundation andthe Linux Foundation Energy.
The “fail faster” business concept also works fasterand more efficiently in open source software.
When collaboration is successful, it is moved into afoundation or standard. But if it is not successful, it canbe dissolved as fast as it was formed.

Flexera estimates that “between 50 and 70 percent of theautomotive software stack originates from open source today...”- Automotive WorldWhy open source software matters to your enterprise

The Linux Foundation 4Opportunities and benefits of open
source software
Open source software offers several distinct businessadvantages. Among them are cost reduction, speed tomarket, collaborative market advantages, differentiating
functionality, increased security through “many eyes”
community scrutiny and code improvements, increased
efficiencies, and innovation jumpstarts.
Companies that use open source software andcontribute to open source software projects also see
a marked improvement in developer recruitment
and retention. These organizations also benefit fromsignificant external contributions to in-house open
source software projects, which reduces cost and risk
and speeds development.
This is accomplished via contributors and maintainers
who are developers in open source softwarecommunities who add and improve source code sothat all benefit from the work of many. Others in open
source software communities work on related activities
such as documentation and marketing.
By contrast, corporate internal developer groups
cannot keep pace with a virtual army of dedicated andmotivated developers and community members working
together. This is especially when internal developers are
handicapped with proprietary code, company silos, andmulti-layered decisioning bureaucracies that are costly
and restrictive. For example, it is difficult to modify,customize, share, integrate, and collaborate withoutside parties. Such restrictions often limit innovationand invention, hobble additional security efforts, create

Why open source software matters to your enterprisevendor lock-in, increase licensing costs, and create
obstacles to getting new products and services to market.
Open source software communities also play significant
roles in driving standardization, commoditization,
and adoption rates – all of which add to the long listof business advantages by increased code and project
stabilization, increased ease of integration, and project
maturity. In turn, opportunities for new, open source
software-based business models are created.

...New business prospects arebooming for companies likeHERE, for “connected vehicles,
IoT devices, and othertouchpoints where mobility iscore (e.g., tracking, monitoring,and autonomous driving).”- Analyst firm Omdia

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Risks and mitigations
Open source software does not mean code that is freefor anyone to grab and run without any responsibilities.
There are responsibilities involved with the use of open
source software code or projects. Licensing complianceis chief among them. Licenses have terms, and users
and distributors of open source software need torespect and follow the license terms.
Actively contributing, maintaining, and sharing codeand related work such as documentation is expected.
Failing to do so can result in backlash and friction in thecommunity. Project funding to support resources thecommunity needs is also appreciated and sometimes
expected from heavy users of the project.
Intellectual Property (IP) issues sometimes arise, sincecode modification and contributions are core activities
in open source software communities. Companies
need to be well-versed on the rules and conditions
associated with each open source software projectto discern the difference between contributing to thecommunity and using open source software to build
their IP. If companies work to understand this from theoutset and plan accordingly, IP issues can be avoided.
Security is generally much more robust in open source
software as many developers work to improve andmaintain the source code. However, open sourcesoftware codebases change all the time, including to
fix security bugs. open source software components

Why open source software matters to your enterprisemust be updated regularly. Updates require diligenceand effort that extends to repairing potential andsubsequent software and services breaks. Further,
given open source software’s popularity and its rise in
adoption rates, it is becoming a much larger and more
attractive target for attackers. Therefore, it is prudent
to both help in securing open source software code andadd layers of security atop any internal open source
software project to thwart attackers better.
Make contributing back to the open source software
project and community a dedicated part of your overall
open source software plan. Allow internal developers towork on external open source software projects duringbusiness hours. Contribute time, effort, mentorships,and even funding to make open source software
projects bigger, healthier, and more viable. This effort
makes excellent business sense as your business,and product innovations will rely on the projects you
selected to use. Therefore, it is in your interest toensure those projects thrive and excel.
Open source software projects often compete with
one another, and it is the better performing, better
marketed, and better-funded projects that tend to winout. You don’t want to see an open source software
project that your company products are built upon
disappear for lack of support, so make sure to lend
those projects your support.

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Where to get free expert help:
To learn more or to get free expert help on starting an open source software project, begin with one or more ofthese groups:

OpenChain (https://www.openchainproject.org/) Open
Source compliance chain management.

Open Source
Tooling Group

Open Source Software Tooling Group (https://osscompliance-tooling.org/) Part of the OpenChain project,
this workgroup is focused on reducing resource costs
and improving the quality of results around open
source compliance activities.

TODO Group (https://todogroup.org/) is an open groupof companies who want to collaborate on practices,tools, and other ways to run successful and effective
open source projects and programs.

Why open source software matters to your enterprise

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Case study: Open source softwarein the European automotive industry
While open source software has not yet taken over
the whole car from front to rear, it does have astrong footing in several subsystems from which it isspreading throughout the vehicle. Its growing presence
within vehicles and the factories where vehicles are
made is remarkable given the highly conservative andprotective nature of the European automotive industry.
Like many other industries, the automotive manufacturingindustry has shifted gears to become software companies
as the entire world moves to digitalization. Notable
among the many automotive industry changes is theconnected car, wherein electrification and self-driving
functions morph the car into a computer on wheels.
Software has become both the main driver of theindustry and the main differentiator between competitors.
Becoming a de facto software company via the urgency
spurred by these market developments means there islittle time to come up to speed. Open source software
quickly became the acceleration ramp since a considerable

Automotive Grade Linux [is] a collaboration ofautomakers, suppliers, and technology companies
to accelerate the development and adoption of afully open software stack for the connected car.
Why open source software matters to your enterpriseamount of the needed computer code already exists
and is easily reused.
Further, open source software teams’ collaborative
nature, sometimes comprised of rivals andcompetitors, enables quicker common problem solving
and faster time to market. In many industries, including
automotive, the past decades saw OEMs focused onbuilding specifications and a supply chain ready to
implement those specifications into components. Thatmodel is rapidly changing, as it has in other industries
such as telecommunications with the evolution to 5G.
One example is Automotive Grade Linux, a collaborationof automakers, suppliers, and technology companies toaccelerate the development and adoption of a fully open
software stack for the connected car. A production-ready
AGL automotive platform is freely available for anyone
to download, modify, redistribute, and build solutions
for commercial sale — it speeds up product and featuredevelopment immensely. Another example is Eclipse
Kuksa, a collaborative open source software project
designed to create an open source software ecosystem
across the vehicle, IoT, cloud, and security domains.
Thus, open source software substantially lowers entry
barriers and provides the legal and organizationalframework necessary to make collaboration among highly
competitive industry players both possible and profitable.
The resulting solutions are also free of expensive
encumbrances such as single vendor dependencies,
often referred to as “vendor lock-in.” Flexera estimates

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that “between 50 and 70 percent of the automotive
software stack originates from open source today,” asstated in a recent article in Automotive World.
One example is Volvo’s electric car company Polestar.
It recently announced a new fully electric Polestar 2
with an Android entertainment system. The company,
like most of the industry, chose open source software
Android to reduce development time and costs and tomeet customer expectations in several areas, including
large and stable app ecosystems and over-the-air (OTA)
software updating. The company found using existing
open source software technology gave it a jumpstarton its vision for a competitive product.
Another example is HERE Technologies, a location dataand technology platform. While the company’s roots are
in-car navigation systems, it has expanded its automotive
portfolio to include connected and automated driving
services. HERE is also addressing customers in otherindustries with location-based offerings, such as transport& logistics, telecommunications, and retail.
According to a recent report by analyst firm Omdia,
new business prospects are booming for companies
like HERE, for “connected vehicles, IoT devices, andother touchpoints where mobility is core (e.g., tracking,monitoring, and autonomous driving).” This also has
implications for smart cities (e.g., planning, transport
flows, smart meters, and grids).

Volvo’s electric car company Polestar...recently
announced a new fully electric Polestar 2 withan Android entertainment system.

Why open source software matters to your enterprise

To take advantage of this new growth potential, HERE
is leveraging open source software in its productdevelopment and is actively contributing back to thecommunity to deliver better value to its customers andboost the developer friendliness of its platform.

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Case study: European smart city
initiatives driven by open source
softwareEurope is currently a world leader in smart city
developments. For example, Stockholm earned the Smart
City 2019 award for its GrowSmarter project at theSmart City Expo World Congress in Barcelona, according
to a Cities Today report.

Barcelona is establishing and sharing best practices it
has developed along the way. It and other European
cities are also collaborating to extend the smart
city network beyond individual cities and countries’
boundaries.

But Stockholm is only one example as several European
cities are recognized globally as smart city development
leaders. Barcelona is one such city. The second mostpopulated city in Spain underscores its commitment
to speeding smart city innovations by its “use andpromotion of Free Software and open technologies
as a social good, to enable collaboration between
administrations and to escape vendor lock-ins,”
according to a Free Software Foundation Europe (FSFE)
report. That same report pegs Barcelona’s investmentcommitment of “70% of the new development budget
into free software development.”“We are collaborating with Amsterdam, Torino, NYC,and others. There is a lot of collaboration going on;
without Free Software this would not be possible,” said
Francesca Bria, Chief Technology and Digital Innovation
Officer at the Barcelona City Council, in the FSFE report.
Open source software is also relevant to cities beyond
smart city initiatives. The city of Paris developed an
open source software platform called Lutèce forproviding government services, which has now also
been leveraged in other regions, including Baltimore inthe United States.1
1. https://technical.ly/baltimore/2019/04/19/paris-lutece-open-sourceplatform-city-services-west-baltimore-community-center-st-francis/

Stockholm earned the Smart City 2019 award
for its GrowSmarter project at the Smart City Expo
World Congress in Barcelona...
- Cities Today Report

Why open source software matters to your enterprise

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Acknowledgements
Dawn Foster
Leslie Hawthorne
Carl-Eric Mols
Thomas SteenbergenMichael Picht

Why open source software matters to your enterprise

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The Linux Foundation promotes, protects andstandardizes Linux by providing unified resources
and services needed for open source to successfullycompete with closed platforms.
To learn more about The Linux Foundation or our otherinitiatives please visit us at www.linuxfoundation.org