There are far too many small to mid-sized businesses still relying exclusively on proprietary software and costly hardware solutions to drive antiquated technology. 

In my experience, deploying Linux servers in mid-to-large business and government contexts offers numerous ways to reduce costs and improve performance.   Moreover, by evaluating the four key areas noted below, some organizations can also discontinue laying-off employees, cutting corners and paying substantial on-going IT costs by moving some of their IT to Open Source and Linux.

Keep in mind that the software you use can and will dictate your hardware and infrastructure requirements and thereby your long term costs. 

I recently visited a non-profit that had so little funding they could not pay their employees, but the "people management" software they used required Microsoft SQL and thereby a local SBS server.  It costs thousands of dollars just to support and maintain their SBS, the MSSQL instance and the hardware to drive it, all necessary to run their proprietary software. 

When I asked the leader if she knew there were several alternatives for their "people management" software, she didn't realize they existed.  A relatively cost effective migration to an open source Linux based solution immediately relieved them of the requirement to run on the SBS and hardware, their Exchange/mail services and the costs associated with running SBS and upgrading licenses.

Of course there are costs associated with any migration.  But small to mid-sized organizations rarely have massive relational databases, and nearly never have mailboxes in Exchange that can't be migrated relatively easily to open source alternatives… or in some small business cases, simply returned to their ISP mail hosting.  Yes, offloading mail services when you have a handful of employees makes relatively good business sense.  A business of five people with a local SBS and Exchange is not necessary or required.

In the case of the non-profit, by switching as they did helped save over $6,000 per year.  Bottom line, your old proprietary software probably has a replacement, and if that replacement solution is driven on open source using Linux server it is probably going to save you thousands.

#2 Your IT complexity results in hidden costs
There is an incorrect assumption that supporting and maintaining a Microsoft server environment is just as complex/expensive as a comparable Linux environment. 

Having spent time in both a Microsoft and Linux support role, I can state the obvious. 

The complexity you find with Microsoft (with licensing schemes and requirements, hardware limitations and requirements, maintenance and dealing with anomalies) is not at all the same as those found in Linux based environments. 

However, what I have found from personal experience over the past decade is that a very good Linux engineer can often address scaling or maintenance in a lot less billable time than a Microsoft engineer (certified and experienced). 

The reason is not a reflection on the engineer or their expertise. 

It is inherent in the complexity introduced when trying to create product and licensing that is as much marketing as it is functional. 

I can offer numerous examples, but this past month I found this exact issue when helping a colleague deal with a licensing "issue."

What was supposed to be a very quick and simple SBS Essentials installation was being held up as the key provided by the Microsoft VLA website did not work.  The result was a two day telephone and email exchange that finally resulted in a new license key being generated and the install continuing.

Sadly, had this been a more thorough SBS installation, having the wrong or non-working key would have still allowed the installation to progress.  Limitations like this are inherent with Microsoft environments because the focus is on the profits associated with licensing schemes.   The time spent by engineers to deal with them is often more substantial than most organizations realize.

Many other examples come to mind, especially when installing half-dozen rack servers.  In such instances I can install six 1U racks running Linux with a colleague in about half the time it takes to perform the same process of server software installation, rack mounting and testing with comparable Microsoft servers.

#3 Webserver performance can be an important business factor
One of the other oddities I've noted is that where almost every small and mid-sized business operates both Internet and Intranet websites, the ones that rely on Microsoft and IIS tend to require more hardware and more tuning to get the same performance.

Installing a new IIS running Sharepoint intranet rarely is comparable with the performance on the same hardware running Lamp stack intranet solutions.  I appreciate and acknowledge that in the hands of a Sharepoint expert engineer the tweaks to IIS and MSSQL can make a huge difference. 

I've seen it with my own eyes, a "shrink wrapped" install is suddenly super charged in the hands of a certified Microsoft expert.  But that expertise also comes with a hefty price tag, especially if the installation is being performed by a service or consultation company and not internal staff. 

The end result is that you either have to pay more to get IIS humming or you have the alternative of installing your intranet website using Linux and Apache running any one of a number of good Open Source CMS solutions.

When I was still managing enterprise projects at Aol, and we were moving everything we could over to RedHat Enterprise Linux servers, and the reasons were overt.  For us to scale the old IIS solutions would have cost far more than simply migrating to a Linux OSS alternative.  And we were scaling for relatively large user base, several million hits per day.

And when the need for scaling and performance become large, Linux clustering is far more economical than trying to wedge the Microsoft environment to support the type of volumes we are talking about.  In several project instances, the government departments that we were installing intranet solutions for were more easily supported and scaled with IBM solutions (Websphere and WCM) running on Linux.

By considering a Lamp stack solution for your intranet, your business might gain the advantages both in performance and support improvements as well as a reduction in the overall operating costs, especially around scaling.

#4 Take into account the weight of your licensing costs
The cost of implementation and licensing are public, not secret.  Microsoft posts its licensing costs, you can calculate the hardware needs, and installation time.  

Doing so will show that licensing costing remains an important factor when considering long term IT costing.  The comparable cost of a Linux server licensed installation is substantively less, especially if you consider the various licensing required around RDS vs Server install, the costs of CALS that are not cross compatible, etc. 

With licensing from companies like RedHat, when in need of Terminal Services, adding a LTSP doesn't suddenly alter your fundamental costs. 

The main mitigating factor is related to software compatibility, and I've found that some companies greatly benefit from moving to OSS, and others do not. 

Therefore, the costs associated with moving to Open Source should factor both the costs associated with using new software and the licensing cost savings. 

In some cases, the price paid for OSS application migration and integration and long term use will be less than that paid for current proprietary software with similar functionality – the key being that functionality and features may be distinct but not necessarily lost.

The question any leader perhaps would be prudent to ask: "does that price differential address the overall ROI of using different software."  That's something I cannot answer on your behalf and anyone who tries to "sell" you one way or other is ignorant of the fact that every business is unique.

What I do urge is that any organization includes OSS in their licensing cost evaluation.

In general, integration of Linux based solutions is a reasonable method of reducing costs and brining performance improvements to certain key business IT areas.  Does it work for every situation in every business context – absolutely not.  However, in general I have found that every business has areas where Open Source solutions and integration of Linux based servers offers improvements.

My recommendation is to evaluate the options, rather than simply replicate based on historic precedence when looking for cost savings or scaling solutions.

Mark Rais has been a technology leader for Aol, Netscape, Advanced Computing, and served as an analyst and technology advocate for numerous government and open source organizations. He currently provides technology consulting services for numerous international organizations and authors articles for Linux+ Magazine, ReallyLinux etc.