Monday, December 4, 2006

What is the Economic Impact of Open Source?

We defined the major economic impact of Microsoft as:

The fact that they have enabled a great many businesses - their customers - to do business more efficiently, and to have businesses that they could not operate at all without the software that enables them.

The same definition applies to Open Source.

It is a fact that Open Source enables a majority of web servers today, a majority of email deliveries, and many other businesses, organizations, and personal pursuits. Thus, its economic impact must already be numbered in many tens of Billions of dollars.

Any improvement in technology that permits business to function more efficiently means the economy runs more efficiently. In this case, Open Source enables business to spend less on software and to have better quality and more control over its software. The money that is saved on software doesn't disappear, the people who save it spend it on things that are more important to them.