Posted by : bpburnwal on Mar 20, 2004 - 02:44 PM General

OPEN source is a reality - we know that much, but legal and policy issues and the viability of the open source business framework are some major areas that yield more questions than answers.
Countries like South Korea, Japan and China are already considering open source as an alternative to proprietary software, but to date Malaysia has yet to decide whether to come out with an official policy on open source.

Nonetheless, many quarters believe investing time, effort and money in open source is all well worth it. COMMERCIAL VALUE Malaysia Venture Capital Management (Mavcap) has allocated RM140 million for the Open Source Software-Platform Investment Programme (OSS-PIP) initiative. The amount is an estimate of what it would take to build a full-fledged open source ecosystem.

Naguib Abdullah, senior vice president of Mavcap, says the actual amount to be invested in the OSS-PIP is solely determined by its competitive merit - with no quota or specific budget set aside - with a small budget allocated to run the programme to attract participants, which will commence in the next one month.

The objective of the OSS-PIP is to get quality local professionals to form a cluster of software companies covering a comprehensive spectrum of software categories capable of offering end-to-end systems and solutions to enterprises, consumers and the Government.

The programme aims to create 40 companies active in OSS, Naguib says, adding that Mavcap has completed its strategic blueprint for moving ahead with the OSS-PIP initiative.

Despite the legal and policy issues, Mavcap sees OSS' potential commercial value.

"The value and benefits of OSS are growing exponentially both here and abroad, with apparent commercial successes of companies choosing the open source route," Naguib says. "Technically, OSS is equal to proprietary systems currently, but we believe the shared global model of OSS will eventually dominate the mainstream requirements for enterprise systems and applications."

Mavcap's market research reveals that within the next two years, adoption of open source in corporations should exceed 60 per cent of the domestic market. NON-COST FACTORS Kenneth Wong, International Open Source Network Programme consultant, United Nations Development Programme-Asia Pacific Development Information Programme, believes reduction in cost is not the only motivation to adopt open source.

"Price does play a factor, but some of the more commonly reported, non- price reasons to switch to open source are national security, security and stability of software in general, to reduce piracy rate, to reduce imports and conserve foreign reserves, freedom from a monopoly vendor, and to develop a thriving local software industry."

Ironically, cost is often given as a strong motivator in developed countries such as Denmark and Finland, but Wong says that is rarely the only reason.





"The city of Munich in Germany chose an all open source solution rather than a proprietary one, even though the open source solution was more expensive. Their primary motivation was long-term cost savings and vendor independence," he explains.

Wong says before implementing any open source project, almost all implementing agencies conducted pilot projects initially. For example, both Thailand and Mongolia had efforts to distribute computers installed with open source systems, and their results had been positive to date. Vietnam also had formally adopted a Free and Open Source Software master plan.

Wong says OSS such as Linux is expected to become more pervasive, seeing the number of national efforts in progress. LEGAL PROBE The technological and social views have so far been good for OSS, but the lack of clear-cut answers on the legal front is a source of concern.

At the recent Third MSC International Cyberlaws Conference, Deepak C. Pillai of Rajes Hisham Pillai & Gopal highlighted some current legal issues on open source. In a paper entitled Open Source, Legal and Policy Issues, written with Andy Woo of the Association of the Computer and Multimedia Industry Malaysia (Pikom), he says the status of open source licences, the General Public Licence (GPL) in particular, is not tested. GPL is the most popular and widely used open source licence, with 85 per cent of licences.

In the context of the Malaysian law, Deepak says some points to ponder include whether the stipulated procedure for acceptance of the GPL is sufficient, whether the concept of "Derivative Works" fit within the Copyright Act 1987, whether the disclaimer of warranties would breach Malaysian consumer protection laws, whether local courts would uphold the exclusion of liability, and how would the damages be quantified.

He suggests that awareness of these issues be highlighted to the local developer community and legal counsel. BUSINESS MODEL How does the open source business model work in the commercial world? Detractors say selling services alone is not viable because it is not scalable, but Naguib argues that companies adopting an open source model are not restricted to selling services alone.

Open source-based products, he says, can be marketed commercially through a licensing or maintenance approach, much like any other proprietary software, with the single difference being pricing or entry costs.

Computer Associates, for instance, has about 60 products ported to Linux. Piti Pramotedham, its managing director for Asia South, says CA ensures that its solutions support the open source model and that since Linux is added to a corporation's information technology infrastructure, it should be able to be managed in the same way.

CA's on-demand computing initiative will leverage the Linux platform, he informs, because the company sees it as a key enabler that will make the on-demand concept work.

Meanwhile, Butt Wai Choon, managing director of Microsoft Malaysia, says there is always a place for OSS, and it's within the academia. He agrees knowledge should be free, but points out that the product of knowledge and talent is not. He adds that the Government should remain neutral with regard to platform, as the choice should be left to the people.

Competition with OSS is really in terms of developers, according to Butt.

Microsoft has been accused of monopolising the market, but he says the company has nothing to apologise for because it has neither abused its position nor gained it by illegal means. "There are people who like what we do and like our products."