Linux Adoption Stalls, Study SaysLinux Adoption Stalls, Study Says

Linux adoption may be "hitting a wall," as use of the open-source operating system fell over a nine-month period, a quarterly survey of companies shows.

Linux use in computer servers running business applications was reported in 53 percent of the 500 North American companies surveyed by SG Cowen & Co. for its Core Technology Survey, released this week. In addition, 7 percent of the respondents planned to adopt Linux, which was the "most modest" level the New York investment banker had seen in its survey.

The combined use or planned adoption of Linux at 60 percent was the lowest level Cowen had seen since September 2003, when the number was 56 percent, including 44 percent having adopted Linux and 12 percent planning to use the open-source operating system.

In addition, the latest survey showed a 10 percent drop from September 2004, when Cowen reported 56 percent of companies having adopted Linux and 14 percent planning to deploy the operating system.

Nevertheless, Linux usage reported in the latest survey was higher than the same study conducted a year ago, Cowen said.

"While Linux usage appears to be growing, this is the first indication we've seen that its adoption may be hitting a wall," the report said.

Linux penetration and prospects were above average mostly among companies that primarily used Unix, a cousin of the open-source operating system, Cowen said. Penetration was highest in organizations favoring Sun Microsystems Inc.'s Solaris platform.

In comparing Linux with Microsoft Windows, Cowen looked at workload trends, which favored the latter platform. Fully 52 percent of companies planned to increase workloads on Windows servers, versus 7 percent planning a reduction. For Linux, those numbers were 50 percent and 10 percent, respectively.

"These data should ease concerns among Microsoft investors about the impact of Linux on Windows in the server market -- success by both is not mutually exclusive and Microsoft seems to be more than holding its own," the report said.

Linux's strongest workload gains were in the smallest and largest organizations, while Windows gained workload fastest in the midsize companies, Cowen said. Windows, however, gained workload faster than Linux in all but the smallest companies.

In other findings, the survey showed that average spending on information technology was expected to increase by 6 percent this year and 6.5 percent in 2006. Spending priorities were highest for security, disaster recovery, internal development and application integration. Companies also were backing off on PC upgrades in favor of systems hardware infrastructure, including servers, storage consolidation and storage area networks.

Major vendors expected to benefit most from the trends were Microsoft, Cisco Systems, Dell and Oracle. Among niche vendors, beneficiaries included BEA Systems, Mercury Interactive, Infosys, Tata Consulting and Research in Motion, Cowen said.