Calculating the ROI of Open Source: How to Build Your Own Model
by Robert M. Lefkowitz, VP, Research and Executive Education
Presented August 03, 2005 at the Open Source Convention
ROI models are a dime a dozen. Most tell you will tell you, surprise, that the vendor who sponsored them is the low cost choice. But just because they are abused does not mean they are useless. When making a big investment any prudent business wants a thorough analysis and ROI is here to stay.
Calculating the ROI for open source is tricky because so many of the costs are measured in time and on-going responsibilities, not in hard dollars. Comparing costs on a level playing field with commercial alternatives can be difficult.
This presentation seeks to present a theory of Open Source ROI and general approach to constructing models that can be the basis for sound comparisons. The presentation walks through examples of the most common cases and points.