Background
Adopting free and open source software can be as simple as downloading one software package, installing it, and using it on a single workstation, or as complex as implementing a Linux server cluster to do complex computing, or anything in between. This section will focus on smaller-scale implementations of FOSS, which are more relevant to most nonprofit organizations.

All organizations should consider implementing FOSS. But in any organization, it is necessary to make a case for what can be a significant internal change. This section lays out some of the factors you might need to address in weighing the costs and benefits of FOSS against comparable proprietary solutions. (Later sections of the primer offer more concrete examples.)

Concepts
There are three concepts to consider when evaluating software: Total Cost of Ownership (TCO), strategic value, and mission-based philosophy.

Total Cost of Ownership:
TCO is a familiar term to many people - it represents a calculation of how much technology costs to implement, use and maintain over time.

Strategic Value:
Strategic Value takes additional factors into account beyond the costs connected to the technology itself. In the nonprofit context this means accounting for the mission-based value that a technology might bring to an organization. Measuring the impact on staff productivity or on the quality of services delivered to clients is part of evaluating strategic value.

Mission-based Philosophy:
In large part, free and open source software is community-driven and owned, and implementations of FOSS will be able to feed back so that all users of FOSS can benefit (from experience, enhancements, changes, documentation, and the like that arises from that implementation.) In addition, FOSS operating systems can be used on older equipment, extending its useful life, and thus making organizational computing more ecologically (and economically) sustainable. If these characteristics of FOSS are in line with the mission of an organization, then use of FOSS is thus mission-based.

The simple act of using software builds community around that software, and you, as the user are now part of that community of users. Every time you ask a question or report a problem, you are contributing to the development of the software you're using. If the software you use is affordable to smaller groups or groups with less resources, or if your clients or members can use tools on their own computers to produce media, then you're making accessible software better by using it and building community around it.

FOSS can influence the TCO of technology, as well as the strategic value that it brings to an organization. Further, it can be aligned with mission.

TCO Considerations

TCO is a calculation of the entire cost of implementing a technology solution. This includes the initial cost of acquiring the software (purchase price, setup fees, subscription fees, or license fees), hardware costs, installation costs (staff time or consultant costs), end-user training costs, and the cost of maintaining the software (annual maintenance fees, support costs, and upgrade costs). This entire spectrum of costs should be considered when comparing any solutions, no matter how they are licensed.

The most obvious advantage of FOSS over proprietary solutions in terms of costs are in the software acquisition costs, maintenance costs, and upgrade costs. FOSS is almost always freely available, has no license fees or annual maintenance fees (there are some exceptions, most often in the form of managed support contracts) and upgrades are also free. Of course, the acquisition costs of most software packages are far outweighed by the other kinds of expenses you'll incur (consultant time, staff training, administration, etc.), so software that is free of charge is not necessarily less expensive in TCO terms than software that you have to pay for.

Newer hosted tools (such as Google Apps for your domain, Kintera, Zoho Office, Salesforce.com among many others) sometimes have an advantage over proprietary solutions in terms of acquisition cost. They also have advantages over both FOSS and proprietary self-hosted applications because there are no hardware costs involved in implementation. However, some of these hosted applications (especially CRM applications) do charge for access to your data, and you generally don't have the same control of your data as you do when that application is self-hosted.

Another model, hosted open source applications (such as Civicspace on Demand or Democracy in Action) gives you some of the advantages of both worlds – although unlike its self-hosted counterparts you'll have to pay a setup fee to get up and running.

Compatibility with mission-critical applications
Key questions to ask when evaluating FOSS technology:
What are the software applications critical to your organization?
What operating systems will they run on?

Another important factor to take into account is compatibility between the open source solution you are considering and any mission-critical applications that you already run. In particular, when considering using Linux as an operating system, be aware that many software vendors still do not support versions of their software that can run on Linux. This is especially true of "vertical" software products for the nonprofit sector, such as case tracking programs for legal-services organizations, or mortgage-tracking programs used by affordable-housing groups. Unfortunately, the increased use of Linux over the past few years has been primarily on the server side, so increasing numbers of server-side applications that run on Linux (such as Intuit's Quickbooks Enterprise product) have not been reflected on the desktop.

Organizations that depend heavily on a program not available for Linux find that, if they want to use Linux, they must also maintain a Windows machine dedicated to running that mission-critical program. If that is likely to be the situation, the costs of maintaining that additional machine need to be included in the TCO. In addition, any inconvenience to users could be considered a drain on strategic value. However, virtualization technology has improved dramatically, so that keeping a windows virtual machine on a desktop that is relatively modern is often a more viable alternative than maintaining a separate machine.

TCO analyses that compare FOSS, proprietary and web-hosted solutions will depend on the complexity of the software, the end user impact, the administration costs, as well as the acquisition cost of the proprietary or web-hosted solution.

Software Acquisition Cost
Key questions to ask about software acquisition costs:
With a proprietary solution, how large will software acquisition costs be relative to other costs?
With a proprietary solution, how easy will it be to get discounted software?

Some proprietary products, like simple tools or small applications, have very low software acquisition costs. Other products, like office suites, groupware, complex databases, financial or fundraising packages, or server operating systems can have high acquisition costs. In some cases, nonprofit organizations can get many software packages or web-hosted applications donated or at reduced costs, which may reduce or eliminate the acquisition cost for the software.

Sometimes, however, organizations are limited in how many copies of a product will be reduced-price or donated (for example, an organization can only get 50 user licenses of Microsoft Office XP from DiscounTech, so a medium to large organization would not be able to take full advantage of this donation. Salesforce.com provides 10 free licenses for their CRM tool, but subsequent licenses are $300/year.) Virtually all open source software is available for no acquisition cost whatsoever, and no multiple licenses are needed.

Case Study: AIDG
(interview with Cat Laine, Communications Director)

Appropriate Infrastructure Development Group (AIDG.org) has a small shop in Guatemala, and needed to find a way to set up that shop with as low cost and easy maintenance as possible. They didn't have money for Microsoft licenses, and wanted to stay legal. They chose to install Ubuntu on their four desktop workstations, and use Open Office for productivity software. Intern volunteers were able to set it all up, and that went very smoothly. Overall, they are very happy with the setup, and the learning curve for Open Office in this situation was very low -“ most of the users were young engineering students. In general, the changeover to Linux was smooth, and the users acclimated quickly.

The shop produces their own brochures and marketing materials in-house, and use the free and open source applications GIMP (an editor) and Scribus (a desktop publishing application) to create those documents. Both have worked well for them, and they are thinking of adding GNUCash (a free and open source accounting application) to the mix.

Cat Laine says of using free and open source software, "it's allowed us to keep costs down, and avoid piracy. We have the productivity benefits of Microsoft Office, etc., and do not have copyright problems. We have found open source alternatives for all of our needs."

Implementation costs
Key questions to ask about implementation costs:
What is the ease of implementation in terms of resources needed (time and money)?
What kind of expertise might be needed for this software, whether it is proprietary or open source?
What kind of expertise do you have available?
How much time, money and other resources will you have to invest?

For some software, implementation is quite easy, and will take a staff person 10-30 minutes to install. More complex applications (financial, client management packages, etc.) take days of staff and/or consultant time to implement, and convert information from an old system.

When evaluating the options for a particular solution, be aware that in some cases open source projects can be more difficult to install than their proprietary counterparts, especially if the folks doing the installing are new to FOSS. It is worth looking carefully at the installation documentation for any solution you are planning to implement.

If your organization will needs consultant support, you may find it difficult to find consultants who are familiar with free and open source technologies, although that is changing as tools are used more widely and organizations that provide technical assistance to non-profits have recognized the value and importance of training their consultants in free and open source server technology. If you now depend on a consultant who is unfamiliar with them, you may need to consider sending them to a training or seeking out a different consultant in order to smooth your move to free and open source technologies.

Hardware costs
Key questions to ask about hardware:
Will you be using multiple servers?
Does the proprietary software being evaluated have any special hardware requirements?
Does it require vendor-certified hardware?

In many situations, you will be implementing software on existing hardware, so you will not incur additional hardware costs. However, if you are implementing a new kind of server, or replacing an old server, hardware costs will likely be an issue. In general, the larger your network needs (in terms of capacity) the more hardware savings you are likely to realize with the a FOSS operating system (such as Linux) and other FOSS on your server. Recent research has found that servers based on Linux (as opposed to Microsoft Windows) can handle more traffic, hold more accounts and do more processing given the same hardware. Thus in a situation where you might need multiple Windows servers, fewer Linux servers will meet your needs.

Training costs
Key questions to ask about training costs:
Will implementing this software require end-user training?
Will you rely on in-house staff to support this solution? What is their current knowledge of the software?

For end-user solutions (like office applications, financial packages, etc.), training is by far the most costly part of implementing new technology. Staff who are going to use this software on a day-to-day basis must be trained to use it, and learn to use it. Most non-technology staff will be unfamiliar with non-Windows operating systems and applications, so implementing an open-source solution that replaces a well known and used application on a widespread basis must be considered carefully. The benefits of using a solution like Open Office, for example, may or may not outweigh the wide variety of training costs that will be incurred. However, the long-term training implications (once the staff are trained, you only require some on-going training, and training of new employees) should also be factored in.

For software that has little or no end-user impact (file servers, database servers, etc.), the only training costs to think about are training your technology staff (or "accidental techies") to handle the new systems. These costs become a larger factor when a) you rely on in-house staff, rather than outside consultants, to support the solution, and b) your in-house staff does not have experience using FOSS.

Maintenance Fees
Key question to ask about maintenance fees:
Does the proprietary alternative require annual maintenance fees?
Will you have to pay for upgrades and security patches?

Some software products have annual fees of some sort. For all practical purposes they can be thought of as annual license fees, since they are typically calculated as a percentage of the original software license acquisition fee. These fees should be included in your TCO analysis.

Most FOSS has no annual maintenance fees, since it had no license acquisition cost to begin with. Some enterprise-level Linux distributions (like RedHat) do have annual maintenance fees, which entitle you to prompt on-demand support. However, very few nonprofits fit into the categories of organizations that would make use of these enterprise-level packages, and they are not mandatory – it is possible to use the equivalent of RedHat for example (it is called Fedora,) at no cost.

Annual fees for web-based software may be quite low, especially when only a small number of users access it, but they also can increase without warning, and new users can push you into a new fee bracket

Upgrade Fees
Key questions to ask about upgrade fees:
How often might you need to upgrade this software?
Are upgrades available at a nonprofit discount, and if so does your organization qualify?

Keeping software relatively up to date is important. It increases stability, security and features. It is not necessary to upgrade at every version change, but it is critical to install security patches, and when features that you want are improved, or there are dramatic stability improvements, upgrading is important.

Obviously, the cost of upgrading a single copy of a software product is much less expensive than having to do a site-wide upgrade. You can often get upgrades of proprietary software at discounted fees or donated. The vast majority of open source software has no upgrade fees at all. You can simply download the upgraded version, and install. (Or, in the case of many Linux distributions, it is a one-command operation - 'apt-get dist-upgrade' or 'yum upgrade' - that upgrades the entire operating system and all software on it.)

Administration & Support
Key questions to ask about administration and support:
What sources of support are available for the open source option? How would they fit into your overall IT support strategy?
How important a factor is reliability in your choice of solution?
Are viruses and other security problems common with the proprietary option?

All software - whether applications, databases, or operating systems -- requires administration and support of some type. In some cases, you will have your staff provide the support; in other cases, you will hire consultants to do it. Characteristics of the software that determine the level of support needed include how reliable the software is, how vulnerable it is to security problems, and how complex it is to use both for end-users and the administrator. Factoring these into your consideration of FOSS is important.

Nonprofits interviewed for this primer that use Linux placed a similar importance on its reliability, as well as security. Without exception, every one said that after they moved to Linux, their network was more stable and stayed up longer. Participants also agreed that it is easier to secure their network using Linux. In part this is because Linux and related operating systems were used for the Internet several years before Windows adopted Internet technology, and the open nature of the code enabled developers to snuff out many potential security problems even before the Internet became popular. In part because of these design advantages, computer viruses and spyware have not affected Linux, while they are prevalent on Windows.

For an organization that relies on consultants for support, this time saved translates directly into costs saved. For an organization that uses in-house support staff, the savings may be more complex to calculate. However, if you are in a situation where you have multiple servers, one administrator can handle more Linux servers than Windows servers.

It is also reasonable to assume that the greater reliability and security of Linux systems improves the productivity of end users. Staff can get more work done if their systems are out of commission less often. Morale is likely to improve with fewer network outages. As most of us have learned the hard way, having your computer crash and destroy the document you were writing, or being unable to use e-mail for several crucial hours during the day is incredibly frustrating.

While it is often the case, one cannot generalize Linux's reliability to all FOSS. There are many FOSS projects that are neither more stable nor more secure than their proprietary alternatives, so doing research will be important for comparison.

In addition to the reliability and security of a solution, you also need to account for its complexity. Complexity can increase support costs in one of two ways: either by increasing the time needed to perform certain tasks, or by requiring a more highly skilled (and thus more expensive) person to do the job. With regard to the first point, our experience and that of the organizations we interviewed is that FOSS is not necessarily more difficult (or easier) to administer than proprietary software. An important caveat, however, is that this assumes that the administrator is familiar with a FOSS solution. If not, additional training costs will be incurred (see Training section above).

With regard to the second point - whether FOSS support staff and consultants are more expensive - our experience is that this is less of a concern than many nonprofits expect. The larger issue faced by the organizations we interviewed tended to be finding staff and consultants who work with nonprofits and have FOSS skills. In the case of networks, there are many more Windows administrators than Linux administrators available in most areas. Again, this does not necessarily hold for all FOSS – there are many sources of support for FOSS CMS systems. And, in addition, the open source community affords its users many more informal sources of support than are available with proprietary software (see Support section).

Strategic Value

Besides TCO (Total Cost of Ownership), you need to consider what we will refer to as Strategic Value. This type of value is harder to quantify, but can often be more important in the decision process.

One facet of strategic value for open source solutions is the ability to solve problems in ways that would not be possible with proprietary solutions. Providing extremely low-cost and secure internet cafe stations, providing a secure network of remotely accessible servers internationally are just a few of those possible solutions using Linux.

Case Study: Alabama Legal Services
(interview with William Guyton)

Alabama Legal Services, an organization that provides legal aid to people who are unable to afford lawyers, was in the position of having to replace their phone system in a matter of weeks. "Our old DOS-based voice mail died, then Katrina hit. We needed to have a call center opened in 6 weeks. No Hardware PBX vendors were willing to commit to that time frame." Asterisk, a Free and Open Source software telephony engine was the most mature software PBX out there at the time, and they chose to implement it.

They were able to get the call center up and running without much trouble. They did discover (and report) some bugs in the software, however. They had been using some FOSS for a while, but "doing a PBX in software means the phone system becomes a change management process. It takes away what is proprietary hardware, and makes it something that needs to be managed." They found that because there was more management involved, the cost ended up being a wash, but they gained much more flexibility. They could “add a hotline in a matter of hours "traditional PBX vendors can't do that." In addition, they found that SugarCRM (an open source CRM solution) interfaced well with Asterisk - so they could know who was on the phone before someone even answered it.

Being able to modify the code in software in a way that will be best for an organization is another example of strategic value. Not all organizations will take advantage of this, but many can. Further, if one organization modifies a FOSS project, it can distribute this modification to other organization that are similar, and collaborate - something that is not possible for either proprietary or web hosted solutions (because of their open platform, Salesforce.com is sort of an exception to this rule, but not entirely.) Further, because the source code is always available, adopting FOSS gives organizations long-term flexibility, the ability to evolve as needs change, and to more easily migrate to new solutions as they arise.

Control (or lack thereof) is another strategic consideration that leads some nonprofits to opt for FOSS. They may have had a bad experience relying on a proprietary software package designed to serve their particular "niche" of the nonprofit sector. If the vendor of that software goes out of business, is acquired by a competitor, or decides to stop supporting that product, then its customers will likely have nowhere else to turn for support. With FOSS, if the original developer disappears the product can live on, supported by its community of users and other developers. So, in the long run, the open source approach can provide a degree of risk mitigation.Control of data is another issue. Data in a proprietary format, or on a server outside of the control of the organization is a disadvantage for some organizations.