Quality. Price. Service. Pick any two,” said a very succinct placard at Damodar’s tailoring shop. Damodar was among the best in the tailoring business and he definitely knew what he was talking about.

However, in the software industry, the emergence of open source software (OSS) no longer allows a vendor to dictate terms. The new catch phrase is ‘pick all three’ and not ‘pick any two.’

Take quality for a start. Studies by Coverity have found that the number of defects per thousand lines of code is lower with OSS than with proprietary software.

One of the most famous sayings in the OSS community is that ‘many eyes make bugs shallow.’ The open, transparent, community driven development model of open source has lead to the creation of some of the most robust software systems ever built.

Those who have migrated from proprietary server operating systems to open source systems will happily testify to this fact. Is it any surprise that 466 out of the top 500 supercomputers in the world run on Linux? Or that mission critical applications like telecom billing solutions, stock exchanges and others are increasingly moving to Linux and other OSS systems?

On the price front, the industry has had to deal with the forced upgrade cycles, vendor lock-ins and hugely bloated software licenses imposed by proprietary software vendors. While the development model of OSS is community driven, many commercial vendors have built business models around service and support for OSS deployments.

Many top-notch system integrators around the world routinely incorporate OSS in the solutions they offer to their clients. Unlike their proprietary competitors, OSS vendors do not have to incur huge development costs and this enables them to offer high quality software implementations at prices lower than proprietary software vendors.

The good news for IT managers is that OSS is no longer restricted to infrastructure software categories like operating systems and middleware, but has expanded to encompass application areas like CRM, ERP, business intelligence, enterprise portals, content management systems and many others.

On the service front, everything boils down to how well the software is implemented and supported. In OSS, commercial vendors usually sell their services in the form of annual subscriptions that have to be renewed. And the quality of services rendered to the client determines whether subscriptions are renewed or not.

This gives OSS vendors an inherent incentive to offer good quality services. This gives IT mangers the confidence to actively consider OSS while procuring software, especially where the OSS option is mature and meets their functional requirements.

At a macro level, OSS is also becoming a key component in IT solutions. A Gartner study estimates that by 2012, 80% of all commercial software will have some OSS components embedded. Market research group IDC said that open source software is gaining ‘enormous momentum’ and constitutes the ‘most significant all-encompassing and long-term trend that the software industry has seen since the early 1980’s.’

A study done by Prof Rahul De of IIM Bangalore, on the economic impact of OSS in India says that OSS can help India save Rs 10,000 crore. These factors necessitate a shift from opportunistic, piecemeal, tactical adoption of OSS to making OSS an integral component of the overall IT strategy.

Given the recent downturn in the economy, cost has been one of the drivers for organisations turning to OSS. However, to be moneywise, they should focus on all three aspects—quality, price and service.

In this context, I cannot resist quoting from another placard in Damodar’s tailor shop. “I have no quarrel with competitors who charge less. They know the value of their goods and services.”

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The author is a journalist turned open source evangelist who works on policy issues like open standards and collaborative innovation. He is Corporate Affairs Director at Red Hat