Japanese Government to Embrace Linux

A Reuters article covering a story originally published in the Nikkei Shimbun says a consortium of major IT firms including IBM (IBM), NEC (NIPNY) and Oracle (ORCL) plan to sell servers and systems running Linux in Japan, following a measure by the government to promote use of the open-source OS within agencies from July.

The Japanese government has earmarked ¥1.25 trillion ($10.4b) for spending on information systems in its fiscal '07 budget. The amount could reach a reported ¥2 trillion ($16.7b) when local governments are included.

Microsoft currently runs 78% of servers in Japan, versus only 14% using Linux, according to the Nikkei.

The Japanese government regards the high penetration of Microsoft OS as excessive and is concerned about having less freedom in system's development.

Other companies expected to join the consortium include: Hitachi (HIT), Hewlett-Packard (HPQ), Dell (DELL) and NTT Data (JP: 9613).

Oracle Japan (JP: 4716) is said to be leading the effort, which could launch as early as next month.

Disclosure: The author does not own shares of any companies mentioned.

Comments

[Malkiel]

We forget that some of the more savvy governments in the world know the consequences of becoming reliant on the grace of foreigners for essential technology. As more governments use open-source products the base of programmers for Linux and Unix development (and availability of commercial softwares written for them) will broaden and become more sophisticated. Linux may not make a noticeable assault on Microsoft's market during its current Vista problem but it will be a significant player in the coming generation...

2007 May 03 05:19 PM

[Sr. Pessimist]

Consider the mobile world. In order to do mobile, you need to know web programming and Java programming. Microsoft just doesn't fit anywhere in there. Japan is not as stupid->corrupt... as America.

2007 May 04 09:37 AM

[Tom B]

Vista should accelerate MSFT's slow decline over here in corrupt America. 5 years, billions of dollars spent-- and it still ain't UNIX. Astounding.

2007 May 07 08:49 AM

[William L. Florida, CFA]

Good story - can you follow the developments on this?

2007 May 04 09:46 AM

[Gen Kanai]

I am extremely skeptical about this news because the Japanese government has said essentially the same thing about once a year for a number of years without any material change. It's not to say that I don't want this to happen, I do, but getting people to change their habits is one of the most challenging things to do, and having users (just imagine your average Japanese government employee) learning a new operating system (even something as friendly as Ubuntu) or new software (Open Office for instance) is a significant hurdle.

The IPA has funded a number of interesting tests in various locales but there has to be a serious desire to change in order to get people to adopt new software, especially at the client level.

I recommend that people keep healthy skepticism on this topic. We've heard the same empty promises before many times and frankly, I'll believe it when I see it with my own two eyes.

2007 May 05 07:02 AM

[Gen Kanai]

Sorry for the double comment but the Chosaq weblog puts it better than I did.

chosaq ｻ Japanese government eyeing Linux? Quick deconstruction of a non-story.

2007 May 05 07:15 AM

[Tom B]

"by dropping the words “Linux” and “open source” every few months, the media will pick it up and fabricate a “Japanese government eyes Linux” type of story - and that, of course, results in cheaper deals with Redmond. Just my 2¢."

Sadly, you probably have a point. But, the upside is that I see increasing margin pressure on Redmond.
I'd hate to be a business where my only two profitable products-- Windows and Office-- where easily replaceable by superior FREE alternatives.

2007 May 07 08:53 AM