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Can We Really Run Our Businesses On Open Source Software

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Danny Windham, CEO of Digium describes how non-profits, enterprises and countries are using open source software

Danny Windham, CEO of Digium describes how non-profits, enterprises and countries are using open source software

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  • Thank you Rich…It’s a real pleasure for me to be here in Miami – especially while the rest of the country is in the deep freezeAnd an honor to get to kick off this year’s IT Expo conferenceFor those of you that don’t know Digium, we are the sponsor and maintainer of the world’s most popular OS communications project Asterisk.And as such – we’ll clearly in the thick of the open source movement – and I suspect many of you here are open source users as well.Over the past few years open source has transitioned from a heritage where the image was possibly a little scary for a corporate IT manager. However, today open source has become very main stream – and I’d like to spend some time talking about running your company on open source. And I’m not talking about as a niche application here and there – I want to address the question – can we really Run our business on open source software. So, let’s take a look at answering that question.
  • Maybe before we dig into the answer ,.. We should ask why one would want to do this …Gartner says - survey results suggest that Saving Money is the #1 reason IT managers embrace open source- The Standish group suggests that open source software has resulted in savings of about $60B per year You know $20B here, $20B there – and sooner or alter your talking big money!Garter says the #2 reason IT managers embrace open source is to protect against a vendor ‘owning’ the infrastructure- And the #3 reason is Ease of Customization- I had the pleasure of meeting and speaking with Mark Penn last week – who is the author of Microtrends Many of the trends he identifies in the book are really about our country’s move to personalization … The internet has enabled suppliers to reach small groups (1M) of specific demand … and open source is the ultimate enabler of personalization …
  • Over the past few years Open Source has been the victim of fear uncertainty and doubt - often at the hands of proprietary software vendors, so maybe it’s worth doing a level set on what Open Source is, and taking a look at current open source adoption trends. So, Open Source is ….Computer software that is ….Normally delivered under a license …Is often developed in a collaborative manner- and often meets the requirements of the Open Source Definition - created and maintained by the Open Source Initiative
  • To meet the open source definition … a software license must …Requires the source code to be made available Demands license terms must apply to all Permits Derived Works Requires free redistribution (as in speech) Does not restrict other software Does Not discriminate based upon technology, users, field of endeavor, or product application
  • There are multiples types of open source softwareThe most common is Free and Open SourceHowever, over the past couple of years, there’s been an explosion in the COSS marketMany open source projects are available under a so called dual license …
  • Some people think of companies having an Open Source Business Model … however, Open Source is NOT a business model….Open Source describes a development model – which is often described as Peer developmentCompanies that sponsor an open source project often give away open source code in hopes of generating demand for their commercial offerings – which means open source software can be used as a marketing model …But, open source is not a business model.
  • Today you can find OSS alternatives to almost any software need…Operating SystemsServer Side solutionsClient Side Solutions-
  • From Front End Systems to Back end systemsFrom Web servers to ERP systems,From database engines to Voice Over IP solutions,From games to security solutions,From networking to storage solutionsAddressing almost any software need you can image … and everything in betweenAnd these projects listed are just a fraction of the hundreds of apps available on SourceForge.net – the most popular repository for open source downloads
  • Some open source applications have achieved market leading share in their respective category – and others, while not market leading, are still very impressiveEstimates suggest that …Linux controls over 20% of the server OS marketFirefox controls over 20% of the web browser marketApache controls over 60% of the web server marketAnd Asterisk reportedly claimed over 18% of new VoIP endpoints installedSo, we’re not just talking niche adoption, we’re talking adoption on a mass scale …
  • So, if OSS is really penetrating end users of all types – who’s using Open Source? Gartner says open source spans the gamut and is being adopted by businesses of all size .
  • In fact Gartner says that 85% of organizations surveyed use OSS is some way. But not only are organizations of all sizes utilizing OSS – but it’s adoption spans industries of all types and applications of all types – including both mission critical and non-mission critical implementations
  • In fact, some of the worlds biggest organizations are users of OSSDrupalAlfrescoSugarCRMMagentoCommerceZen
  • Not only does OSS power the worlds biggest companies – but – maybe even more importantly, it also powers the products from a company called Zynga.  Zynga is the the game company behind Farmville, Mafia Wars, Fishville, etc.   John Doerr of Kleiner, Perkins fame saidZynga is the most-profitable, fastest-growing company that Kleiner Perkins has ever invested in. Just three years old, Zynga has an estimated market value above $5 billion, more than 320 million registered users, 1,300 employees and estimated revenues this year above $500 million. Zynga products – are built using open source. 
  • However, you probably didn’t come here to learn about game technology – so let’s look at some real world case studies of how organizations of all sizes are benefitting from open source software
  • Because most open source software is free (as in beer) – Open Source actually penetrates one segment of the market rarely addressed by proprietary implementations – which is reflected in our first caser study – which is a Humanitarian Relief effort. Because there are very talented and capable volunteers out there willing to help in the time of crisis, OSS fits perfectly into humanitarian relief efforts because it allows the volunteers to use their cash donations in ways other than purchasing software, then they use their own skill in constructing a solution to address the crisis at hand …Case in point, following the earthquake in Haiti in Jan of 2010 ,,,,
  • And project called called ReleAnmwe (loosely translated Haitian meaning ‘Cried Out’ – where the project organizers used OSS software to quickly and inexpensively create a system that enabled individuals to reach emergency services (hospital, pharmacies, food, shelter and distribution centers)OSS communications and speech recognition software, including Asterisk and Cepstral, Verbio and others allowed the developed of a communications system that allowed callers to receive info in their native language – and the speech rec permitted those with injuries to use the system
  • In a similar vein, not-for-profit organizations are adopting OSS for similar reason. One such organization is Inveneo …Inveneo is addressing the challenge that over 1B people are without access to clean water, electricity – or communicartions
  • Inveneo is using OSS software and solar powered PCs, to build a basic computing and communications capability for remote villages. The project has been successful in improving the quality of life for the inhabitants of these villages, by improving their access to medial care and education – and in one example, helping the villages to protect themselves by simply being able to receive warnings of advancing rebel forces.
  • Now, while those case studies are both very meaningful in terms of their impact on helping to make the world a better place – most of you are here to understand how you can make you company a better place.So, I’d like to review some case studies where OSS is being adopted by business of all sort.And I couldn’t come up with a better smb case study than Digium. So, Can you lower the cost of running the IT infrastructure of a small to mid sized, growing company, by using predominately Open Source Software?Well, it turns out that Yes You Can
  • In Digium’s case, we’re a mid sized company by most definitions – and while we are an OSS company – we don’t have an OSS edict in our IT philosophy – even though we do have a OSS preference.
  • While we’ve not done an extensive study on what the total savings have been as a result of our use of OSS software, our educated guess yields numbers in the several hundreds of thousands of dollars. The savings apply not just on the backend systems, but also to our desktop strategy, and our engineering development efforts, Today the most popular desktop operating system within Digium is Linux, the most popular productivity suite is Open Office. Our entire company runs on the Zimbra collaboration suite. The most popular web brower is Firefox – and we’re in a migration where Android either is or is becoming the most popular Mobile OS.
  • You might envision that we run the entire company on an Asterisk-based PBX, and we make extensive use of OSS in all areas of our corporate IT infrastructure. Our web site, both front end and back end runs on OSS, our chat server, business intelligence, knowledgebase, and elements of our ERP system are powered by OS software. Many of our systems run on an open source virtualization engine – and we even utilize open source tools to monitor the health and document the topography of our internal networks.
  • Open source is used extensively in our R&D department, where we use open source tools and systems to help develop, track, manage, and maintain the development of Digium products – and we make sure of open source scripting languages to help improve the efficiency in writing open source software.So, do we have any proprietary software in use at Digium – in fact we do – but it’s the exception rather than the rule.
  • So, if you can run a mid sized business on OSS – can you run an Enterprise size business on OSS? Well, turns out the answer is yes you can
  • The operators of the London Stock Exchange migrated from a commercial product, TradElect,a system that is Microsoft .Net based. However, what’s interesting about this case study is the way LSE went about the project. Given the $65M price tag for TradElect, the LSE bought MilliniumIT – a Sri Lanka based consulting company, and commissioned them to build and maintain the new system using OSS – and now estimate they are saving roughly 10 million pounds per year. Not only are they saving money – but now making changes to the system is in their own hands – and Trading speeds went from 2.7 milliseconds to 0.4 milliseconds per trade.
  • So, if you can run a large company on Open Source Software, can you run a large city on OSS. Well, Turns out Yes you Can, the city of Amsterdam is doing it today!
  • Amsterdam might be viewed as a very progressive city – but usually for reasons other than those that are IT related. However, in the world of IT they are very progressive there too. They set out to move as many proprietary applications as practical to OSS based alternatives. Today they are in the process of converting nearly 30,000 city desktops to OSS – including the Operating System – the typical desktop productivity packages, and the phone system. They are estimating millions of euros in yearly savings.
  • So, if you can run a city on OSS – could you run an entire island on OSS? Well, turns out that ‘ Yes You Can!’The island of Nuie is a very small island in the south pacific – and it is a LONG way for anywhere. There is no GSM service provider there – and the inhabitants of the island wanted a mobile communication system.
  • So, a small group of consultants developed, installed, and made operational a wireless infrastructure were each inhabitant received a mobile phone, and using OSS software like OpenBTS and Asterisk – built a system that provided connectivity for everyone on the island. Since the system is built on off the shelf hardware, open source software, the the inhabitants have copies of the source code – the system can easily be recreated in case of disaster – like a Hurricane. They are in the south Pacific afterall.
  • So, if you can run a island on OSS – could you run an entire country on OSS? Well, turns out that ‘ Yes You Can!’
  • Malaysian government today has targets of 80% adoption for backend and 30% for desktop adoption – but by 2010 had remarkably hit 97% adoption
  • And others are following suit. Russian Prime Minister, Vladimir Putin, issued an order in 2010 that all Russian federal bodies and agencies switch to free and/or open source software by 2015And, there are those that believe the US Government should do the same thing. Open Source for America is an industry group advocating open source adoption in the US federal government
  • So, if the software if free, does that mean it doesn’t cost anything?
  • Well of course not. What’s free is the software acquisition cost – but that’s only a portion of the total cost of any software project.
  • TCO normally includes acquisition cost, hardware cost, training costs, system adminstration/development/configuration/customiation costs and ongoing maintenance/support
  • The OSS model normally eliminates Software acquisition cost – potentially reduces hardware cost given that off-the-shelf hardware is typically used, and can significantly reduce on-going maintenance costs – or at least change the maintenance model.OSS does typically transfer some of the responsibility that normally falls on a vendor – to the user of the software. Therefore, internal administration costs typically go up.
  • So, if that’s the case, what type of organizations benefit most from OSS. It’s those with in-house skill and expertise, like technology companies, larger organizations that have the benefit of lots of employees – like Enterprise and Government agencies , and those organizations that have access to talent at low costs – like UniversitiesOSS is often a very attractive alternative in cases where the application that’s being replaced comes with per-user licensing fees
  • So, does that mean that other organizations that don’t fit this profile can’t benefit from OSS? Well, NO it doesn’t. This is where the COSS model makes sense. If you are a smaller organization – or don’t have the in-house skill – or the desire to apply your in-house skill to creating or maintaining an OSS solution – you can still gain benefit from the OSS model by purchasing the service or in some case a product under a COSS arrangement. There are a number of COSS products and services on the market. In Digium’s case, we package a IP PBX based upon Asterisk as a turn-key solution – a product that’s sold under the brand name of Switchvox. And many other OSS organizations do the same.
  • So, it’s virtually impossible to make a cost comparison analysis with specific numbers that can apply in broad-based situations – each company, each project will require it’s on dedicated TCO analysis to make an informed decision. However, you can generically relate the relative costs of Free and Open Source, Commercial open Source, and Proprietary alternatives. In our experience, from a TCO perspective, proprietary solutions are typically the most expensive – and the characteristics of you own company’s structure and internal capabilities dictates whether or not traditional open source or commercial open source alternatives will produce the lowest cost for you.
  • Ok – hopefully by now I have convinced you that the open source train is rolling. But if your company is not yet on the train – how do you get started? Gartner interviewed a host of companies that had recently adopted open source and asked what they wish they had done differently.The two most common answers were one …- that they wish they had spent more time up front understanding the different open source licenses- And two – that they wish they created a policy ahead of time – and used in making their decisions along the way
  • Some of the most popular OSS licenses include the GPL (GNU Public License) (GNU = GNU not Unix) version 2 and 3 – the Lesser GPL (often applied to libraries) the Apache license, the Mozilla Public License, and many others. Understanding the license requirements is important – but most licenses are much more permissive if your not planning to redistribute the software.
  • So, how do you learn from their mistakes?With regard to license issues, there are a number of on-line resources that will help you understand the obligations and restrictions of the popular OSS licenses. Opensource.org – gnu.org – are both good resources – and there’s even a consulting company that will help you sort this out – who has some helpful on-line tools – called Protecode. There are also a number of lawyers that now specialize in OSS licenses.
  • To address the policy issues – Gartner suggest that you develop a use policy – and once again there are on-line resources to help with this, and then adhere to the policy, train your in-house resources on the policy, and use tools to track your source code portfolio – which by the way there are open source tools to do this with – and then periodically review completed projects for compliance with the policy.
  • So, in summary – if you’re just getting started – thendive in and determine the best method for your organization to benefit from open source- spend some time to understand OSS licensing- develop a use policy- carefully consider the success and adoption of any open source application you considerIn areas where you need supplement talent – consider COSS to augment you internal capabilities
  • WelcomeThanksGreat time to be in MiamiHere to discuss the question ….

Transcript

  • 1. Can we really runour businesses on
    Open Source Software?
    Danny Windham, CEO, Digium, Inc.
  • 2. 2
  • 3. OK, but why would you?
    #1:
    To save money
    Estimates suggest that adoption of
    open-source software has resulted in savings
    of about $60 billion per year to consumers
    #2:
    Protection
    against a vendor ‘owning’ the IT infrastructure
    #3:
    Ease
    of customization
    Source: Gartner & Standish Group
  • 4. What is Open Source Software?
    Open-source software (OSS) is...
    Computer software that is available in source code form
    Normally delivered under a software license that permits
    users to study, change, and improve the software
    Open source software is very often developed
    in a public, collaborative manner
    Some open source software is licensed in a fashion
    that meets the requirements of the Open Source Definition
  • 5. What is the Open Source Definition?
    Software meets the Open Source
    Definition if the license...
    • Requires the source code to be made available
    • 6. Demands license terms must apply to all
    • 7. Permits Derived Works
    • 8. Requires free redistribution (as in speech)
    • 9. Does not restrict other software
    • 10. Is technology-neutral
    • 11. Does not discriminate against persons or groups
    • 12. Does not discriminate against fields of endeavor
    • 13. Is not specific to a product
  • Types of Open Source Software
    Free and Open Source Software (FOSS)
    • Source code is freely available
    • 14. License meets Open Source Definition
    Commercial Open Source Software (COSS)
    • Contains some element of FOSS, but constrained in some way by commercial terms
    • 15. Mixed source applications
    • 16. Some free and some closed source
    • 17. Freemium business model
    Dual license model
    • FOSS that is also available under a proprietary license
  • What is Open Source?
    Open Source is NOT a business model
    Open Source IS a development model
    Open Source CAN be a marketing model
  • 18. Open Sourcede facto Standards
    Function/ApplicationOpen Source
    Solution
    Operating System Linux
    Web Server Apache
    Browser Firefox
    Telephony/Communications Asterisk
    Database MySQL
    Customer Relationship SugarCRM
    Management
    Backup Zmanda
    Productivity Suite Open Office
    Collaboration Suite Zimbra
  • 19. Asterisk Telephony/Communications
    eZ Publish Web Content Management
    Apache Web Server
    Talend Open Studio Data integration, migration, synchronization
    Knowledge Tree Document Management
    Wordpress MU BLOG platform
    Pentaho Business Intelligence
    SugarCRM Customer Relationship Management
    Zencart E-Commerce tools
    Eucalyptus Web Services
    Zenoss Systems Management
    Open Office Productivity Suite
    SelectedOSSBusinessApps
  • 20. SelectedOSSBusinessApps
    Vicidial Predictive Dialer (Asterisk companion)
    Firefox Web Browser
    Openproj Project Management
    Openmeetings Meeting collaboration
    Mediawiki Wiki creation/management
    LimeSurvey Online surveys
    OpenBravo Enterprise Requirements Planning
    Ekiga “Skype-like” functionality
    Dolphin Smart Community building
    Community Builder
    Compiere ERP
    Community Edition
    OTRS Help Desk/Support
    Zimbra Collaboration
  • 21. OSS Adoption
  • 22. Who Uses Open Source Software?
    Open Source adoption spans the
    gamut of business applications
    from non-profit to small business to enterprise to governments
  • 23. Who uses OSS?
    Gartner says …
    85% of organizations surveyed use OSS
    Organizations surveyed included:
    small, medium and large organizations
    Cross sections of industries:
    Manufacturing, education, financial services, service organizations, etc.
    Cross section of applications:
    Mission critical and non-mission critical
  • 24. OpenSourceAdoptionTrends
    Source: Forrester Research 2/2009
  • 25. OpenSourceUsers
    15
  • 26. OpenSourceUsers
    16
  • 27. Let’s Look at
    Real World Examples
  • 28. Case StudyHumanitarian Relief
    Challenge:
    The devastating January 12th,
    2010 earthquake in Haiti left the people and organizations unable to reach emergency services.
  • 29. Case Study
    Humanitarian Relief
    Solution:
    Rele Anmwe (Humanitarian Project), using OSS software, quickly and inexpensively created a communications system which enabled individuals to reach emergency services (hospital, pharmacies, food, shelter and distribution centers)
    OSS voice recognition technology allowed
    the callers to receive information in their
    native language – and allowed those
    individuals who due to injuries were unable
    to use a telephone keypad.
    Result:
    The Haitian people were able to contact emergency services in their area
  • 30. Case Study
    Not-for-Profit Adoption
    Challenge:
    Over one billion people in under served countries around the world do not have basic access to clean water, sanitation, electricity or telecommunications
  • 31. Case Study
    Not-for-Profit Adoption
    Solution:
    INVENEO (Not-for-Profit Entity in CA) uses OSS software along with solar-powered PCs to provide basic computing and communications capabilities to villages in need
    Result:
    • The difference between life and death (medical applications)
    • 32. An increase of 50% - 100%+ profit on crops(commerce applications)
    • 33. A better future for the children (education applications)
    • 34. The ability to communicate ideas with the rest of the world
  • Case Study
    SMB Adoption
    Challenge:
    Can you lower the cost of running the
    IT infrastructure of a small to mid-sized
    company by using predominately
    Open Source Software?
    Yes you can!
    Digium is doing it today.
  • 35. Case Study
    SBM Adoption
    Solution:
    Use OSS alternatives in any application where it does not represent a compromise decision.
    • No OSS edict
    • 36. OSS preference
    Result:
    Significant cost savings versus proprietary solutions
  • 37. OSS Software in use at Digium
    Product/Project Application
    Linux Desktop and Server OS
    (Ubuntu, CentOS, Debian, Fedora)
    Firefox Web browser
    OpenOffice Productivity suite
    OpenVPN Virtual Private Network client
    Zimbra Email/ contacts/ calendaring
    Pidgin Chat client
    Android Mobile OS
    24
  • 38. OSS Software in use at Digium
    Product/Project Application
    Asterisk PBX
    Jabber (ejabberd) Chat server
    OS Commerce ERP
    Apache HTTPD Web Server
    MySQL, PostgreSQL Database
    Drupal Content Management System
    Knowledge Tree Document Management
    Pentaho Business Intelligence Tool
    Xen Virtualization engine
    Nagios Network management
    Cacti Network graphing Tool
    25
  • 39. OSS Software in use at Digium
    Product/Project Application
    Subversion Revision control system
    Git Version control system
    GCC (Gnu Compiler Collection) Complier
    Mantis Bug tracker
    ReviewBoard Code review system
    Python, PHP, Bash Programming languages
    26
  • 40. Case Study
    Enterprise Adoption
    Challenge:
    Can you run the systems that power one of the world’s largest stock trading floors on open source software?
    Yes you can!
    London Stock Exchange is doing it today.
  • 41. Case Study
    Enterprise Adoption
    Solution:
    Use OSS for better performance and greater cost savings. Move from a .NET-based platform to Linux/OSS-based alternative to lower the total cost of supporting a high performance, demanding trading platform.
    Result:
    London Stock Exchange predicts annual cost savings of at least £10 million ($14.7 million) from 2011-2012.
  • 42. Case Study
    Government
    Challenge:
    Can you lower the cost of running the IT infrastructure of a large city by utilizing open source software?
    Yes you can!
    The city of Amsterdam is
    doing it today.
  • 43. Case Study
    Government
    Solution:
    City of Amsterdam set out to move as
    many proprietary applications to Open Source
    as practical.
    Windows > Linux
    Microsoft Outlook > Zimbra
    Microsoft Office > OpenOffice
    Siemens PBX > OSS Asterisk-based PBX
    Result:
    Millions of Euros of cost savings versus the incumbent proprietary solutions
  • 44. Case Study
    Government
    Challenge:
    Can you develop and install a communications infrastructure for an entire island using only OSS?
    Yes you can!
    The island of Niue is doing it today.
  • 45. Case Study
    Government
    Solution:
    The people of Niue – an island nation in the South Pacific – where there is no GSM operator, outfitted all inhabitants with mobile phones and created a switching infrastructure using OSS Software and off-the-shelf hardware.
    OpenBTS + Asterisk + My SQL
    Result:
    Anyone on the island can talk to anyone else for free. System is easily replaced in case of a disaster (Hurricane!)
  • 46. Case Study
    Government
    Challenge:
    Can you lower the cost of running a country using Open Source software?
    Yes you can!
    The government of Malaysia is doing it today.
  • 47. Case Study
    Government
    Solution:
    Malaysian government set out to convert 30% of the agencies using desktop apps and 80% of the agencies using back-end apps to Open Source.
    Result:
    By 2010, 97% of the agencies had converted some portion of their infrastructures to Open Source
  • 48. Case Study
    Government
    Solution:
    Russian Prime Minister, Vladimir Putin, issued an order in 2010 that all Russian federal bodies and agencies switch to free and/or Open Source software by 2015
    Result:
    TBD
  • 49. If the software is free…
    does that mean it doesn’t cost anything?
    Yes
    the software is free
  • 50. If the software is free…
    does that mean it doesn’t cost anything?
    Yes
    the software is free
    No
    the total cost of ownership is not $0
  • 51. Total Cost of Ownership includes:
    Acquisition costs
    Hardware costs (or lease expenses)
    Training costs
    System admin costs (personnel related)
    Maintenance costs (internal or third party)
  • 52. OSS Cost Comparison
    OSS typically lowers:
    • Software Acquisition Costs
    • 53. Hardware costs
    • 54. Ongoing traditional maintenance and support costs
    OSS typically increases:
    • Internal administration/development costs
    • 55. Can increase training costs
  • OSSAdopters
    FOSS then ideally suited for:
    Organizations with in-house IT/software expertise
    Replacing applications with per-user license fees
  • 60. What about everyone else?
    Other organizations can benefit from OSS
    through commercial derivativesof OSS projects
    Selected
    COSS Applications:
    SugarCRM
    Alfresco
    Pentaho
    Drupal
    Red Hat Enterprise Linux
    Knowledge Tree
    Bacula
    etc.
    Digium example:
    Switchvox is a packaged
    IP PBX based upon Asterisk
  • 61. TCO Analysis
    42
  • 62. Challenges to OSS adoption?
    Gartner says ...
    • Lack of license knowledge
    • 63. Lack of policy or governance
  • What are popular OSS licenses?
  • 64. Overcoming license issues
    Lack of license knowledge
    Utilize available resources
    • opensource.org (Open Source Initiative)
    • 65. GNU.org
    • 66. Protecode License comparison
    • 67. Wikipedia OSS License Comparison Charts
    • 68. License experts
    • 69. Restrictions are often significantly less for internal use versus external distribution
  • Overcoming policy issues
    Lack of Policy
    • Create an IP/legal compliance policy
    • 70. Analyze license requirements of candidate software
    • 71. Provide in-house training on license compliance
    • 72. Utilize tools for source code portfolio management
    • 73. Review completed projects for compliance
  • OSS Adoption Recommendations
    • Determine the best method for your organization to benefit from OSS
    • 74. Develop an understanding of Open Source license options
    • 75. Develop polices around adoption of Open Source software
    • 76. Assess OSS projects based upon maturity and profile of existing adopters
    • 77. Consider commercial Open Source support to augment internal skills and expertise
    Source: Gartner
  • 78. So, can you really runyour businesses on
    Open Source Software?
  • 79. 49
  • 80. Thank you!
    www.digium.com