VDC Sees Market Pressures Squeezing Linux Software Stack

A number of market forces are limiting the ability of Linux software suppliers to extract revenue growth from the freely available open source software markets. Recently published research by Venture Development Corporation (VDC) indicates that embedded systems manufacturers and their suppliers are driving the development of open source and industry-specific standards around Linux as a means to increase availability of more robust underlying solution platforms and development environments. These new standards hold the opportunity for OEMs to reduce their development costs and time-to-market while at the same time keeping pace with the advancing and unique requirements of their customers in their core markets.

These industry- and market-specific initiatives have served to create more robust open source platforms that are cannibalizing some of the differentiation found in commercial releases. Now those companies, as well as virtually all others, must find new means of adding value, differentiating and driving revenue.

Embedded Linux software solutions - VDC

“The recent efforts to standardize around more robust, market-specific, feature-rich Linux platforms have the potential to accelerate adoption of Linux for a wide range of applications within the markets where these efforts are underway. Success in those markets has the potential to accelerate Linux adoption across the broader embedded device market,” says Chris Rommel, Research Associate with VDC’s Embedded Software Practice. “However, market pressures are coming from a number of directions that will require commercial suppliers of Linux solutions to manage an increasingly complex set of peers, partners and competitors. Suppliers of commercial Linux solutions will need to focus higher up the software stack in providing an ecosystem of value-added technology, and in so doing, as their OEM customers encroach on their traditional domain, commercial Linux suppliers must be wary of competing with some in the higher level domains.”

VDC explores these and other critical issues within the market for embedded Linux software solutions in the recently released report, Linux, Volume 1 from Track 1 of VDC’s 2008 Embedded Software Market Intelligence Service.

About VDC
Venture Development Corporation (VDC) is a technology market research and strategy consulting firm that advises clients in a number of industrial, embedded, component, retail automation, RFID, AIDC, datacom/telecom, and defense markets. Using rigorous primary research and analysis techniques, the firm helps its clients identify, plan for, and capitalize on current and emerging market opportunities. We strive to deliver exceptional value to our clients by leveraging the considerable technical, operational, educational and professional experience of our research and consulting staff. During our nearly four decades of ongoing operation, we have had the pleasure of serving most of the world’s leading technology companies, many high-profile start-ups, and numerous blue-chip early and later stage investors. Our products and services consist of research reports, annual research programs, and custom research and consulting services. Founded in 1971, the firm is located in the Boston area.