Linux adoption has occurred in three stages, according to Dushant Shahrawat, senior analyst with TowerGroup, in a presentation at last month's SIA Technology Management Conference. The first, he says, occurred pre-1998 when "people just heard of it and immediately brushed it off." The second stage lasted from 1998 to 2000, which saw about one percent penetration in financial services. Today, says Shahrawat, Linux has about seven to eight percent market share in the server world. "People like Merrill Lynch and Morgan Stanley and Bear Stearns are now talking about their experience with Linux," he said.
Among the factors driving Linux adoption, the pricing issue has been overstated, according to the analyst. "People focus too much on the cost and licensing issue," Shahrawat says. "That is almost missing the point. Once you have your choice of hardware providers, it changes the hardware business into a commodity. In the past, if you ran Solaris, you could only buy from Sun Microsystems. Not if you're on Linux."
Thus, vendors of both operating systems and hardware are attempting to fight the Linux onslaught, but that may not work for long. "Who do you fight?" asks Shahrawat. "You are fighting a community, a movement."
Editor's Note: This article originally appeared on Wall Street & Technology Week, a sister property of Bank Systems & Technology.