Linux and Small Business: The Ongoing Disconnect
The VAR Guy pulled up a chair and participated in the Channel Happy Hour podcast last evening. The discussion — featuring channel veterans Brett Martin, Gerard Kane and Chuck Lennon — included a Linux reality check for VARs. Lennon, president of TeamLogic IT, said he still isn’t seeing or hearing much about Linux in small business. Here’s why.
When it comes to Linux, The VAR Guy can’t keep his mouth shut. Our resident blogger has some strong opinions to share. While Red Hat, Novell, Canonical and other Linux distribution providers continue to gain momentum, most of the Linux chatter has very little to do with small business success. Consider the facts:
1. Red Hat has pushed beyond its Linux server heritage to promote JBoss middleware and Red Hat Enterprise Virtualization (RHEV). Mention middleware to a small business, and they’re bound to respond with a look of confusion. Plus, RHEV certainly doesn’t scream small business.
2. Novell continues to gain some momentum with SUSE Linux Enterprise appliances. But much of the recent Novell BrainShare conference focused on Intelligent Workload Management (IWM), an enterprise-centric strategy aimed to help large and midsize businesses with their virtualization and cloud strategies. VARs won’t be pitching IWM to small businesses anytime soon.
3. Two years ago, Canonical had a decent start in the U.S. consumer market — promoting Ubuntu Linux on a range of netbooks in U.S. retail stores. Fast forward to the present, and Microsoft has largely won back the U.S. consumer netbook market with Windows 7. Partners like Dell continue to offer Ubuntu netbooks, but Dell’s most recent fancy involves Ubuntu Enterprise Cloud (UEC) — which most small businesses have never heard of.
Of course, Red Hat, Novell and Canonical each are making calculated small business moves. But there’s nothing in the Linux world — yet — that has successfully countered Microsoft Small Business Server and Microsoft’s ongoing investment in small business channel partners.
In stark contrast, most of Red Hat’s channel partners seem to focus on mid-market and large business opportunities; Novell has been busy rebuilding its channel after years of neglect; and Canonical is just getting started with its partner program. The VAR Guy will provide deeper details when he unveils the second annual Open Source 50 survey results in May 2010. But in the meantime, Microsoft’s grip on small business appears firm.
During the Channel Happy Hour podcast, TeamLogic IT President Chuck Lennon essentially confirmed that point. TeamLogic IT is a VAR franchising business, so Lennon has his ear close to the ground in the small business market.
SMB: Silent Linux Successes
Still, Linux has found multiple back doors into the small business market — without necessarily attracting much attention from small business owners.
Small business network appliances — everything from routers to switches to security hardware — often have Linux at the core. Plus, a range of managed services and SaaS applications run atop Linux. (One prime example: N-able‘s N-central software for MSPs was written on Linux.) And Google Android will surely give Linux a lift in the mobile small business market.
Will small businesses ever ask for Linux by name? For some boutique VARs — such as The Linux Box — the answer is yes. But for the vast majority of solutions providers, small business customers still demand Microsoft.
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I’m trying to run my business completely off linux and convince others to do the same!
Brandon: Why? From your point of view, what are the business advantages of standardizing on Linux? Sure, The VAR Guy sees some key biz advantages involving Linux — but why are you motivated to leverage open source?
-TVG
VG: No CALs.
With that said, a lot of SMBs do not run “correctly” with regards to required Microsoft licensing. But one of the largest costs for SMBs is client licensing… if they choose to not be illegal.
However, you are correct that for the most part SMBs will NOT choose Linux. The main reason, no part-time Linux sys admin on staff.
A Linux distribution is a highly flexible platform that can be used to create just about anything. In the hands of a “master”, it can be a transforming tool like no other. But many SMBs have bought into the concept that IT has little or no cost associated with it. Thus you have ignorant people administering Microsoft AD, Exchange, etc. and… they feel pretty good about it… until things go wrong. But, we live in a world with punishment or responsibility anymore… so it’s not a big deal. You just rebuild, apologize to the world and move on.
IMHO, what is needed are more volunteer Linux sys admins… but people like to eat…. so, that’s unlikely.
If SMBs would bring in some people with some Linux skills, I imagine that a site of 50 – 100 people could save 50-80% of their annual cost vs. an all Microsoft solution. However, there WOULD be a dependence on Linux knowledge (arguably they NEEDED Microsoft knowledge previously, but the world has deemed that to be optional).
I’ll be presenting at the regional APCUG conference, Sat May 1st. Speaking on Linux and Windows integration… ya’ll come!
VG:
As a consultant, I have a client business (~15 employees) that has being using 98% linux since late 2004. The two percent Windows is machinery controlled by Windows and single desktop running QB. One of their most important machines is actually running linux.
Hardware – thin clients, notebooks, PC’s.
OSes – CentOS4/CentOS5/Fedora
Database – postgresql
Custom apps – python, reportlab, perl
ERP – OpenERP (replaced inhouse written system )
PCB layout – Eagle Professional, GEDA
Mechanical CAD – VariCAD
Wordprocessing, spreadsheets etc. – Openoffice, Scribus, glabels
Other engineering software – Scilab/Scicos,gnuplot,G95 Fortran,octave
Internet/Web – Firefox,Chromium,Opera,kopete, lighttpd, Joomla
Document Management – ERP, DocMGR
I think the main reason there hasn’t been much interest in getting Linux to the SMB market is because the support infrastructure is making way way too much money fixing infected machines and broken systems because of bad updates, poor software install programs etc. There is little incentive to help these SMB’s because of the big fat revenue stream coming from running the life support for Windows.
If SMB’s switched to linux and opensource and even commercial licensed linux software where needed, what would fill the lost revenue from fixing Windows PC’s?
I have no affiliation with these guys; I did run a Clark Connect (previous version of this) a few years ago. For SMB today, it’s a pretty good Linux solution.
— From their site:
ClearOS is a powerful network and gateway server designed for small organizations and distributed environments. Though ClearOS comes with an extensive list of features and integrated services, the solution is easy to configure thanks to the intuitive web-based interface.
Link: http://www.clearfoundation.com/Software/overview.html
What about Novell’s Open Workgroup Suite Small Business Edition? Has that product made any inroads to the SMB market? It looks promising to me, but I work a Large scale operation (aka we run one of everything).
Bingo. Plus, there simply aren’t enough consultants who know about Linux, and many of them have so much work that they can’t dedicate the time to learn. One sole proprietor put it to me this way: “If I concentrate on Windows, I can go on vacation or get sick and know that there are 4 or 5 other support companies in the county who can help take care of my clients during my downtime. If I do Linux, I’m the only guy available…”
Excellent article.
IME, small biz users want Windows on the desktop and are afraid to have anything but Windows on their internal server(s) due to unfounded compatibility concerns. They simply don’t know any better. I wouldn’t recommend adding Linux to an already happy client install unless they really need to save money or ask for it.
MS-SBS is a hard solution to match on capabilities and price with Linux solutions. It hurts me to say that. The Outlook/Exchange calendar integration alone beats all the Linux solutions on price.
My company uses Linux for almost all our internal servers. I chose most of them. We run IMAP, Zimbra, Alfresco, Apache, MediaWiki, vTiger, Adito VPN and a few other apps. Any small businesses looking for email, IM, DMS, web, wiki, CRM, and VPN could be setup fairly easily. We run most of these in VMs on 2 physical machines, although they will run on a single one if needed.
I’ve been unable to pry Outlook or MS-Office away from the users. Both the CEO and I use OO, but when we work with clients or others inside the company, the format issues simply aren’t worth it and we fight with the new xface in MS-Office 2007. Change is hard for some people, me included.
Some thoughts for multiple comments:
Chris@3: CAL (Client Access Licenses) is an excellent point. Thanks for raising it.
Gary@4: The VAR Guy thinks you’re right. If VARs and MSPs largely dumped Windows for Linux or Mac OS X, some customers would potentially see lower support costs (In The VAR Guy’s opinion).
Ken@5: Novell barely (if at all) markets/promotes that product. Haven’t heard about it in the channel recently…
Josh@6: Yup, Linux needs more VARs for support…
JohnP@7: The VAR Guy is watching Zimbra, Alfresco and a bunch of others on your list closely. Thank you.
-TVG
Finally! Someone talking about small business and Linux.
I have a small business. 3 employees. There are millions of us out here. Most “Small businesses” have few employees.
I have tried to set my business up using Linux (Hate Windows)all to no avail.
The 3 areas that have failed are:
1) Simple accounting software that can be setup without the hassles of setting it up. Like Quickbooks. Most small companies use Quickbooks or Peachtree.
Most all accountants use it as well. I simply email my accountant a copy of my Quickbooks and she takes care of the rest. I got it running on Vmware until ’06, however ’09 will not work.
I even tried setting up SQL Ledger, but failed miserably as I have to set it and other software up.
Here’s why:
REQUIREMENTS:
————-
1 – Perl, 5+
2 – http server (Apache, NCSA, httpi, thttpd, …)
3 – SQL Server (PostgreSQL 7.1+)
4 – DBD (DBD-Pg)
5 – DBI
6 – LaTeX (optional)
All the above: 1 thru 6 mean %^$amp;$amp; to me. Quickbooks requires a couple of clicks and your done. Besides, you have to get all those setup before you can setup SQL-Ledger.
I have tried and tried and can’t even setup Apache or the database software. Let alone SQL-Ledger. Quite frankly, as a business owner, I do not have the time or energy to to go through this.
2) Fax/voice software suite. I have tried all of available software with Linux, however I can’t get any of it to do the things that Windows programs like Symantecs Talkworks, or Faxtalk. Most of my suppliers still do everything with faxing, so I have to address this problem with my business.
The linux software that suppossedly will do all this , I can’t figure out how to setup. I am not a rocket scientist nor do I want to deal anymore with “make amp; build”.
3) Printer port/dongle support. I have windows specific software that requires dongle recognition on the printer port. None of the virtual software that I have tried recognizes or knows how to deal with this issue.
Until someone in the community recognizes my number 1 concern,(a way to adopt the top 2 Windows Accounting programs to work in Linux),the harsh reality is that Linux will never take root in the “Small Business” community. The other 2 are more specific to my concerns.
The SMB I work for has been evaluating switching to an open source solution too. Because of this, I’ve been very active in looking for effective replacements for our current infrastructure.
One solution we’ve been keeping a close eye on is the eBox Platform. This solution has ~85% of what we need. But here’s some current holes in the solution we need to be covered: Outlook integration (staff rely on this), shared calendars and ActiveSync Push technology. Notice how most of this is to do with Microsoft Exchange? Microsoft have positioned themselves well here to make it exceedingly difficult for companies to find comparable functionality elsewhere for competitive prices.
The best solution we have been able to find that supplies the needed Exchange functionality is Zarafa. Zimbra comes close, but is too bloated with unnecessary functionality for SMBs at a price that is too high. Open-xchange is just as expensive as Microsoft Exchange, offers comparative, if fewer features and locks you in to similar money-treadmill contracts. Please note that I have absolutely no affiliation or personal preference for any of these companies – it is merely my observation.
I guess my point is, at this point in the Linux SMB market, if you break away from the MS SBS Server+Exchange combination then you also inflate your support cost. “Support Cost” in terms of time administering multiple systems delivering separate functionality that are not necessarily integrated.
For SMBs, having to take that kind of a gamble/plunge can be very frightening and unsettling.
As stated previously, eBox-platform is looking the best at the moment to deliver a system that integrates all this for the SMB market. They have a few things they need to do first though. Even if they can’t directly build the necessary functionality themselves, being able to offer an integrated solution with suppliers help would be a huge win for the Linux SMB market.
BriGuy@9: Your point about small business accounting applications is well taken. Some readers may point to SaaS accounting software or virtualizing Windows/Accounting on top of Linux. But lots of small business don’t want to jump thru those hoops.
Sam@10: Thanks for mentioning the eBox solution. The VAR Guy will study it more closely.
Linux Accounting for small business
Good for retail, not hard to setup at all.
Quasar – http://www.linuxcanada.com
Mybooks – cross-platform (windows,mac,linux)
It’ll do pretty much everything QB does. Not difficult to setup. Also have higher end offerings too.
http://www.appgen.com
I’m not affiliated with either company
Another vote for eBox – it’s a big step toward the SBS replacement. Using it at a college at the moment and it makes it easy to tie together a domain with Windows clients and central user database. It’s a little clunky around the edges but not bad. They would do well to build it as a real SBS replacement – install with XFCE4, VNC/NoMachine NX to make it comfortable for the Windows converts. Create some walk-through guides and call it “eBox Small Office Server”.
To those looking for an accounting system on Linux: try PostBooks edition of xTuple. Dirt simple one-click install on Linux, Mac, or Windows. Clients and Server can mix or match platforms
http://www.xtuple.org
BriGuy:
Licensing dongles are a real pain. One of my real hopes for the dawning era of cloud computing will to see a move a way from licensing dongles as software customers want more flexibility to run proprietary apps instanced inside rented cloud infrastructure frameworks accessed via virtual desktop protocols. The physical dongle model for licensing control is terribly terribly inflexible.
Folks: Sorry The VAR Guy fell behind on this conversation. Planes, trains and automobiles this week. A few catch-up thoughts…
Gary@13: The VAR Guy never heard of Quasar but will check it out.
HippieShaker@14: “Clunky” ain’t gonna cut it with small business customers. A product alternative has to be monumentally better than an entrenched standard (Small Business Server) in order to prompt migrations…
Josh@15: Your mention of xTuple is interesting because The VAR Guy expects that company to participate in this year’s Open Source 50 survey. Stay tuned for results in May 2010.
Jeff@16: Yup, SaaS and cloud potentially change the rules. The VAR Guy’s business leverages QuickBooks. But our resident blogger has a hunch the business will transition to SaaS accounting later this year. Just a hunch…
-TVG
@VarGuy, re your response to HippieShaker@14: ClearOS comes *really* close to being all that is SBS, plus some. If I had spare time – which I don’t – I’d take ClearOS and add Plone (to replace SharePoint in SBS) and iCal Server (to replace the calendaring part of Exchange). Then I’d install xTuple and integrate it with LDAP (I’m currently researching to see if that’s possible). Finally, I’d take it and create proper SELinux security policy for it.
*Everything* else is there. Plus it’s easy to administer. The best feature, however, is that it’s based off of CentOS, which in turn is based off of RHEL. This means that with proper configuration it can be far more secure than even Windows 2008 SBS.
Josh: The VAR Guy thanks you for jumping back into the conversation. Here’s the central challenge:
1. Thousands of VARs continue to promote and support Small Business Server.
2. A few dozen VARs promote xTuple.
Thousands vs. a few dozen. The simple math says most SMBs will never, ever hear about xTuple until the open source industry does a far better job building channel programs. Efforts like the Open Source Channel Alliance and Tech Data’s Open Tech (can’t find URL…) are decent starts. But far more is needed.
-TVG
Great discussion everybody.
Novell Small Business Suite is a nice product. It cost more than some of the mentioned options but less than MS-SBS. I am going to do an upgrade for a client and the features and options look good. Now I will have to see how the upgrade goes which will be the real test. Novell does allow more virtual machines than MS-SBS Premium. Groupwise mail is solid and can compete with Exchange. And, now Novell has Novell Teaming to compete with Sharepoint. Novell appears to be putting resources into Small Business Suite, but as was mentioned, their channel program and marketing for the product are lacking.
That being said I do like MS-SBS. I wish they would upgrade faster but overall I think it is a good product.
Back to the main discussion, I have OpenBSD running in clients offices as Samba file servers and they have no idea. (I use OpendBSD as much as possible. OpenBSD is a stable and well documented operating system.) The point made Josh made about people to support the systems is I think a big issue. Without going off on a support rant, it is hard to find good support. And these systems are getting more complex. Along, those lines, why not use the Novell Appliance Toolkit to package the accounting program and run on VM?
Take care,
Victor
As I was going through the past week of TVG posts I saw the one about IBM and Novell. This reminded me of IBM who also is bad to market to SMB. They have Lotus Foundations which is for SMBs and very nicely priced. If I understand correctly, $100 per client access and server is included. So, 5 user cal is $500. But I think this is a yearly license. Talk about bad confusing marketing. Any way, Domino/Notes for mail and Lotus Symphony for Office apps. Just another option for you to evaluate in your spare time.
Thanks,
Victor
Victor: Indeed, Lotus Foundations is worth watching. But after some initial buzz a few months ago, The VAR Guy hasn’t heard much from IBM and the Lotus teams regarding Foundations…
-TVG
I have customers setup on Novell OES, Groupwise, and Zenworks. 99% of all these back end services are running on Linux. The firewall is a Linux appliance that integrates with Active Directory and eDirectory. If the customer needs quickbooks I just setup a windows server running on Xen visualization that comes supported with OES. I have a small investment advisory company that I support that has redundant servers for 9 people. They have never been down in the last 7 years. I patch server during the day and they don’t even know that it is happening.
I worked with another company that saved $450,000 dollars on Microsoft license fees just my moving the call center portion of the bushiness to Linux Desktops.
WCSDFW: Hmmm… Are you in the Dallas/Fort Worth Area? (DFW?)
Either way, The VAR Guy thanks you for your business insights. Please keep our readers posted as you pursue additional customer engagements. Our resident blogger welcomes detailed financial info describing how one solution my deliver better returns than an alternative solution…
-TVG