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At the end of each calendar year, it is journalistic tradition to both look back and look ahead in sports, politics, entertainment and so forth. The Open Source Software (OSS) movement deserves equal treatment. This is the "looking back at 2007" part of a two-part series.

If you don't think 2007 is the "year of the open source software (OSS) market," or that at least 2008 will be, you are dancing out of step at the Software-Market-Research Ball. Information technology (IT) product and market analysis firms cannot release research fast enough declaring that the "OSS market" is growing rapidly. These analyst-firm PR efforts—and others from the supplier community—say users will be (if they are not already) clamoring for OSS. "Wall Street" chimes in that OSS should be considered a major investment opportunity. The OSS blogosphere adds weight by amplifying the research firms', suppliers'and stock brokers' upbeat messages.

And yet basic market research says no OSS market even exists. That is the case because, with a few exceptions, people are not "meeting" to "buy and sell" OSS because it is OSS. So users are not clamoring for OSS and there is no discrete market growing rapidly. In addition, the jury is still out on OSS’s investment potential. In fact, if the OSS philosophy fully plays out, there are storm warnings for Wall Street.

To understand this apparent conflict, look back at OSS in 2007 from three perspectives. In the context of the $250-$300 million software market as measured by worldwide supply-side revenue, OSS-related license software represents a small percentage. Examples include the imputed value of the Apache HTTP server embedded within WebSphere Application Server and Oracle's Oracle Container for J2EE (OC4J) middleware component. Of course, this is just OSS-related license revenue; by definition, there is no actual OSS license revenue. Second, from a user-census perspective, there is a hint of increased activity in the free-as-in-air software movement. But that Free Software Foundation (FSF)-based activity lacks a major ingredient required in something if it is to be analyzed as a market: "free as in air" software is not bought or sold. Third, there is a growing subscription maintenance services business for both OSS-related and actual OSS-licensed (no revenue) software. But the dynamics of that services market are no different than the existing subscription software maintenance market. From this perspective, there is nothing new for analysts, suppliers and investment firms to research.


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