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An economic analysis of enterprise adoption of open source software

Author

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  • Evangelos Katsamakas

    (Graduate School of Business, Fordham University)

  • Mingdi Xin

    (Stern School of Business, New York University)

Abstract

The emergence of open source and Linux has burdened IT managers with the challenge of whether, when, and in what applications to adopt open source software in their firms. We characterize the conditions under which enterprises adopt open source software. We show that adoption depends crucially on network effects, the fit of software with the range of applications used by each firm, and the IT capabilities of a firm. Our model predicts that most firms will adopt a heterogeneous IT architecture that consists of open source and proprietary software. The equilibrium adoption is often socially inefficient. This is the first paper in the open source literature to model the enterprise adoption of open source.

Suggested Citation

  • Evangelos Katsamakas & Mingdi Xin, 2005. "An economic analysis of enterprise adoption of open source software," Working Papers 05-29, NET Institute, revised Oct 2005.
    • Handle: RePEc:net:wpaper:0529
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    References listed on IDEAS

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    More about this item

    Keywords

    Open source software; Linux; IT management; IT architecture; IT capabilities; technology adoption.;
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