b‎ > ‎c‎ > ‎

7

Supported by

International Business

Asian states see open source as window of opportunity

By JENNIFER L. SCHENKEROCT. 27, 2004

Continue reading the main story Share This Page Continue reading the main story

In West Bengal, a tropical region in the northeast of India best known for tea and tigers, students at 2,500 rural schools are getting their first introduction to computers.

But the software that gives them a window on the world will not be Microsoft's.

After testing Microsoft products in 300 of the schools, the regional Education Ministry said it decided to instead install open-source software on 10,000 new computers, the first phase of an even bigger project.

Desktop software from Red Hat, a U.S. company that repackages and sells the Linux system, offered savings of 25 percent to 30 percent over Windows, G.D. Gauta, a principal secretary in the information technology department in the West Bengal Ministry of Education, said in a recent telephone interview.

But even if Microsoft had dropped its prices, it would not have made any difference, Gauta said, because "the Linux system is a better system."

Government agencies in such countries as India, China, Japan, South Korea, Malaysia and Australia are increasingly adopting the same stance. Their decisions are not entirely based on commercial factors like price and maintenance but on larger, geopolitical issues.

A growing number of governments believe that the digital divide cannot be bridged with proprietary software and that open-source software, which is developed collaboratively and exchanged freely over the Internet, is the best path to aid the transfer of wealth from the industrialized world to developing countries.

It is difficult for software companies in developing countries to break into the commercial software market. Providing services on top of an infrastructure of software that has been collaboratively developed worldwide is far less costly, smoothing the path for companies around the world to start competing locally and on the world stage, according to Kevin McIsaac, research director at the Sydney office of the technology consultancy Meta Group.

Microsoft argues that the "ecosystem" around its products creates jobs and wealth in countries where it does business. But the perception among local citizens is that the big winner is still a single company in the United States that rakes in billions of dollars a year in licensing fees.

In contrast, open-source software can be compared to a communal farm. Everyone helps dig the ditches and does the other work needed to make the infrastructure run for free, McIsaac said, "but my plot is my plot and I get to keep the proceeds from my grain."

"It is a potentially new economic model that goes beyond capitalism, based on give and receive and then take something on top," he said. "This is the biggest challenge that Microsoft has ever seen for one reason: It has always defeated competitors by commodizing markets but it cannot commodize open software, and it is a major problem for them."

Making matters more difficult for Microsoft is another development: Some governments have started actively working to spur the development of open source in order to aid national technology champions.

The Chinese, Japanese and South Korean governments have jointly agreed to work together to develop an Asian flavor of Linux. At the heart of the effort is an attempt to bolster local players like China's Red Flag and Japan's Miracle, which is partly owned by Oracle.

Companies like Oracle, IBM, Hewlett-Packard and Sun Microsystems are trying to make money in Asia by selling databases or hardware, middleware and services around Linux.

And these companies are scoring points by working closely with governments to help them create stronger local software markets. For example, in August, the Chinese Ministry of Information Industry announced the opening of a joint Linux software lab with Hewlett-Packard.

"China has an ambitious long-term vision for gaining credibility and ultimately dominance in the global software market," said Michael Barnes, an analyst in Sydney with Meta Group, adding that Linux is at the heart of that strategy.

Red Flag, a Chinese Linux company, and Turbolinux, which is co-owned by the Chinese government and Turbolinux of Tokyo, are fast gaining ground on western companies like Red Hat and Novell, according to Meta Group.

  • 1
  • 2
Next Page »

Continue reading the main story

We’re interested in your feedback on this page. Tell us what you think.

#auto

Subpages (1): g
Comments