This post originated from an RSS feed registered with Agile Buzz
by James Robertson.
Original Post: Overrated, Underrated of 2004
Feed Title: Cincom Smalltalk Blog - Smalltalk with Rants
Feed URL: http://www.cincomsmalltalk.com/rssBlog/rssBlogView.xml
Feed Description: James Robertson comments on Cincom Smalltalk, the Smalltalk development community, and IT trends and issues in general.
But the smoke generated by the offshoring debate obscured the big picture, which has to do with an increasingly global economy and the changing nature of technology work. And short-sighted executives, bent on offshore outsourcing for bottom-line reasons only, may risk trading innovation and competitive advantage for short-term gains. Wal-Mart Stores Inc., the world's biggest retailer--and arguably the most tech-savvy company in any industry--does all software development in-house. "We'd be nuts to outsource," says CIO Linda Dillman (see "Wal-Mart's Way," Sept. 27, 2004). Outsourcing in general, including offshoring, is a valuable business-technology strategy. But it needs to be employed for the right reasons.
Compare Red Hat Inc.'s midtier standard price for Linux with tech support ($799) to a roughly comparable Windows Server 2003 license from Microsoft ($999), and you begin to see how the numbers really crunch. And those are just list prices. Among the revelations to surface in the Justice Department's failed attempt to block Oracle's proposed takeover of PeopleSoft Inc. was eye-opening evidence of deep discounting. Penny-pinching CIOs can play Red Hat against Microsoft, Microsoft against Oracle, and Oracle against SAP.
In addition, there are costs associated with open-source software that aren't always obvious. Yankee Group analyst Laura DiDio reports that in-demand Linux system admins can command salaries 20% to 30% higher than Windows staffers. In addition, third-party tools and intellectual-property insurance can jack up the overall cost of open-source environments even more. So, here's how to do the math. Add up all the costs to run an open-source stack. Subtract thousands of dollars in concessions from proprietary-software vendors anxious to negotiate. The difference might be less than you think.
There's also a slap at bloggers in there, and a few other things of interest. Have a look.