Canadian business got yet another smack from analysts for
lagging the US in productivity and investment in new technology at
the LinuxWorld and NetworkWorld Canada conference underway in
Toronto this week.
James Sharp, vice-president of customer segments research at IDC
Canada, made his case with a blitz of statistics. The Canadian
economy may look healthy today, he said, but underlying weaknesses
are obscured by recent hikes in the Canadian b U.S. dollar exchange
rate. There is a systemic lack of innovation in Canada, he
declared.
Investment by Canadian business in R&D is 64 per cent of the
comparable U.S. figure. Labour productivity is just 75 per cent
that of the U.S., and has been declining dramatically since 2000.
If this continues, it will eventually lead to a lower standard of
living, said Sharp. Reversing this slide will require greater
investment in technology to make Canadian business grow faster,
bigger, better.
The size of the Canadian IT market b comprised of hardware,
software and services, is $39 billion b with the Big Five banks
comprising about 50 per cent of the pie. In 2005, the financial
services and telecommunications sectors were the only two to
achieve a growth rate higher than the average of 4 per cent for
last year, said Sharp, demonstrating the correlation between
investment in IT and growth.
Based on IDC research, only 20 per cent of Canadian businesses
have adopted Linux or other open source technology, and a small
number of the senior executives surveyed saw it as strategically
important to their business. It is still largely perceived as
suitable only for niche back-room applications, said Sharp.
Interestingly, although the majority of respondents cited cost
avoidance as the number one reason to adopt open source, the
perception that it is cheaper than proprietary software has
decreased in recent years. In another session, Jim Elliott,
advocate for infrastructure solutions at IBM Canada Ltd. in
Markham, Ont., said there are many misperceptions about open source
in Canada. IDC's 20 per cent open source uptake figure is probably
accurate for "official" open source implementations b but this
technology is in use far more than IDC's respondents realize, he
said.
Linux is everywhere, the IBM exec noted. Like many
organizations, saud Elliott, the province of Ontario's official
position is not to use open source for mission-critical
applications b but Linux is nevertheless used in its security.
"Many don't realize that Nokia's firewall, for example, is
Linux-based." He noted that even Microsoft Corp. offers open-source
(the source code for .Net, for example, is published and is more
open than Java).
Many are under the misapprehension that an open-source
application built on proprietary software must be published but
this is not true b it only needs to be published if an organization
sells that application. Indications of the lack of uptake of open
source in Canada, particularly in the public sector, emerged in
another session presented by Reuven Cohen, CTO of Enomaly Inc., an
open source consultancy based in Toronto. Enomaly has been involved
in about 100 open source implementations, but most of these
projects were in the U.S. Although the company has made proposals
for recent Canadian public sector content management solutions
(CMS) put out for bid, proprietary CMS technology tends to win out,
said Cohen.
Lack of expertise may be an issue, based on a case study
presented by Cohen. Enomaly recently assisted in the implementation
of an open-source content management system (CMS) at the
Dana-Farber/Harvard Cancer Center in Boston. Dana-Farber is not a
physical organization, but a virtual amalgamation of five Boston
hospitals and two Harvard schools involved in cancer research. The
organization had outgrown its old CMS, and needed a new one that
would allow 800 researchers and 20,000 support staff scattered
across different locations to access and update vast quantities of
information on the latest cancer research in an organic way.
According to Cohen, senior management at Dana-Farber
deliberately sought an open-source CMS, largely to save on
licensing costs for proprietary software, but also because the
organization already had deep, in-house open source expertise,
thanks to its ties to Linux-friendly Harvard University. Much of
the development work on the CMS was done by Dana-Farber's team.
Enomaly's role was in developing the technology strategy to
facilitate that, selecting the right system (eZPublish), and
documenting the system requirements in consultations with
users.
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