Considering TCO

I'm amazed. For the first time in recent memory, I find myself in total agreement with Microsoft CEO Steve Ballmer. According to published accounts of the Microsoft Fusion 2002 conference, Ballmer said, "We haven't figured out how to be lower-priced than Linux."

There it is. Finally, the acknowledgment from Microsoft that Linux is a lower-cost solution. But does that make Linux a better deal?

Well, I'm sure Ballmer will insist that Microsoft has a better value proposition. But what are some of the cost elements that IT management needs to examine to find out?

As I have previously argued, the cost of acquisition is clearly a win for Linux and open source. But traditionally, cost of acquisition has been only a small part of the equation for calculating the TCO (total cost of ownership) of a PC solution.

But now that Microsoft seems bent on selling "software as service," the annual licensing fees that Redmond wants are a more serious consideration than the old one-time fees used to be. In fact, you now have to compare the price of "renting" Microsoft software to "buying" open source. Paying the rental fee for one year might be acceptable, but be sure to calculate the amount of money you will spend during the next five years or so. That drop in the bucket might be measured in gallons before you're done.

Then there's the cost of talent. This is one item that some folks harp on a lot. Yes, you might have a staff trained in Windows who would need to be retrained in Linux. But you inevitably face that dilemma every few years anyway, even if you stick with Microsoft solutions.

The truth is that nothing stands still in the IT world, and if it does stand still, you probably want to run from it. But before you figure that you have a staff with no Linux experience, take a poll. Heck, you might have a few people who already run Linux at work but never bothered to tell anyone about it. It certainly wouldn't be the first time that's happened.

Next is the cost of support -- not the cost of external support, mind you, but the cost of supporting your own organization. I have heard time after time that this is one of the big, unexpected wins when an organization deploys a Linux solution.

The increased stability, the elimination of rampaging viruses, and the absence of the need to reboot or reload the operating system all add up to a significant reduction of support costs. When your systems run the way they are supposed to run, you can greatly reduce the number of people you assign to handle problems.

There are, of course, more factors to consider than I have room to include here. But my point is this: The factors that play into calculating TCO are changing. Open source is more cost-effective than ever. But don't take my word for it; do the math for yourself. You might be surprised.

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