July 18, 2005, 9:24 AM — Linux usage is rising quickly in Asia, thanks in part to widespread support for the open-source operating system among governments in the region. But the real driving force behind the growing adoption of Linux in Asia is the business community's need for lower IT costs.
The key to lowering technology costs is to choose open-source software and commodity hardware, says Linda Brigance, CIO at FedEx Corp.'s Asia-Pacific operations, speaking to Chinese IT managers at a recent conference in Shanghai.
"We need to make sure we are driving our systems cost down with Linux," Brigance says.
Despite the growth, these are still early days for the operating system in Asia. Microsoft Corp.'s Windows accounts for the bulk of software licenses sold in the region for both server and client operating systems.
But while Linux holds a small percentage of the overall operating system market in Asia, it's spreading quickly. Shipments of Linux server licenses there rose by 36 percent in 2004, and shipments of client licenses rose 49 percent, according to IDC. Windows shipments are also growing, but at a slower pace: 24 percent for server licenses and 14 percent for clients.
One of the companies that has benefited from increased Linux usage is Dell Inc., which is seeing demand for Linux-based servers rise at double-digit rates. Linux is one of the most important operating systems in Asia, particularly in the server market, says Bill Amelio, Dell's senior vice president for Asia-Pacific and Japan.
"A lot of customers are looking for open standards," Amelio says, noting that demand for Linux in Asia has outpaced demand in other regions.
Big Growth in China
Much of this demand is coming from China, where the government has backed Linux as an alternative to Microsoft's continued dominance of the operating system market. But government support isn't the only reason a growing number of Chinese companies are using Linux. Practical business demands are playing a role too, particularly in the country's financial industry.
In April, the Industrial and Commercial Bank of China (ICBC), the country's largest bank, announced plans to deploy Turbolinux Inc.'s Turbolinux 7 DataServer operating system for all of its front-end banking operations over a three-year period. While financial terms of the deal weren't disclosed, the project represents one of the largest Linux deployments yet undertaken in China.
ICBC is switching to Linux to replace applications that currently run on The SCO Group Inc.'s version of Unix. The bank wanted to upgrade these systems and chose Linux largely because it wanted better performance and vendor support, according to Nielse Jiang, an analyst at IDC in Beijing.
ICBC isn't alone. Several of China's largest banks are also expected to move their front-end applications from SCO Unix to Linux, Jiang says.
In coming years, more Chinese companies will turn to Linux as a server operating system to help cut their IT costs, says Wise Huang, IT solutions manager at APL (China) Co., a shipping and logistics company in Shanghai. APL has standardized its PCs and servers on Windows, but Huang says the open-source operating system deserves consideration by Chinese IT managers. "I always suggest that my customers use Linux," he says.
Government Influence
Like in other parts of the world, governments in Taiwan and Hong Kong are long-winded about open-source initiatives. But much of their support for Linux appears to be on paper only; implementation of the operating system has been slow. Businesses in both places have picked up the slack, turning to Linux as a lower-cost way to run servers and other systems.
In Taiwan, for example, officials have long worked on plans to deploy Linux on computers in government offices and public schools. Although there have been some success stories, progress has been slow, critics say. But a major government initiative that began nearly five years ago has produced results such as the promotion of Linux in embedded software, with the help of the island's hardware makers.
Championing open-source software in Taiwan has been particularly important because of the huge role Taiwanese companies play in the global IT market. Taiwanese companies operating on the island and in China account for a large share of the world's IT products and parts -- and nearly the entire world supply of motherboards.
