Do open systems compromise performance?

I am keen follower of anything and everything happening in Open system space. Let it be small scale upgrade of non critical system from Microsoft to Linux in corners of so many companies around the world. All qudoes to guys who struggle to convenience thich skin Crocodile bosses. Even bigger place like German Railway Transporation Agency moving their 40 ciritical server to Linux (Over S/390 with virual partition).

I come across interesting survey conducted by Asian Bankers debating on most important aspect of Open System deployment. Few extracts from the same is reproduced for your reference.

Asian Banker Research has found that the total cost of ownership advantage of open systems versus proprietary systems may not be as great when issues such as scalability and stability are considered.

Cost remains the fundamental issue in core banking systems decisions. A recent survey of 17 banks in Asia by Asian Banker Research showed that 47 percent of the institutions are choosing to replace their legacy systems with open systems rather than with proprietary technology to obtain cost efficiencies, despite a possible sacrifice in performance, stability and availability.
Asian Banker Research found that total cost of ownership (TCO), the Gartner-formulated industry standard for measuring and managing IT investments, is significantly lower for open systems compared to that of proprietary technology. Although the cost benefits vary among banks, savings as high as 50 percent are not unheard of.

In core banking, the biggest savings can be obtained through the reduction of operational costs – specifically the costs of hardware support, operating systems and software licenses maintenance. Studies have shown that the TCO for UNIX is competitive against other operating systems, while Linux’s TCO is even lower.



Reduction in no. of Vendors:
The key driver for cost reduction in the open systems space is the number of vendors for hardware and software, of which 37 percent of banks agreed is an asset of open systems. Unlike proprietary technology, open systems allow for a freedom of choice where customers are not locked into one particular vendor, hence, spawning competition that drives down costs and stimulates a wealth of product offerings.

Reduction in Development Cost (Talent rather than Salary):
Across the board, banks agree that the cost for hiring proprietary technology specialists outweigh those of open systems. A source cited that salaries for PL1 programmers are one and a half times those of Java peers. This trend is particularly evident in India, where the ease of procurement of CMM level 5 professionals and competitive costs of local talent are highly attractive.


Concurrently, 11 percent of banks cited the availability of third party applications compatible with UNIX as a key strength of open systems. Although the presence of standard protocols enables UNIX packages to be comparatively easier to implement into the core banking system, integration remains a complex endeavor, complicated by the existence of various configurations of UNIX.

Another 37 percent identified open systems to be more scalable. Despite the relatively unproven technology of deploying open systems on a massive scale, one large multi-national bank that is planning to migrate from their legacy platform to an open system is confident that any scalability problems are rapidly disappearing.

Critics, however, opined that open systems do not measure up to proprietary systems in this aspect because an increase in transaction processing volume would require the incremental addition of CPUs, which in turn may affect the performance of software applications that are not developed with this scenario in mind. Furthermore, the relational database nature of open systems places a relatively higher demand on the overhead of the CPU and storage disk than the non-relational database nature of proprietary technology.

Stability and availability remain areas where open systems fall behind. While the proprietary systems are known to be stable and less vulnerable to attacks, outages can occur in open systems as often as once or twice a month. Remedy of problems such as clustering, mirroring and fall-over processes will add to the TCO of the enterprise.

In view of open systems’ cheaper technology, even banks without prerequisite UNIX and Linux skills are willing to work around this problem by outsourcing or developing the skills of their internal employees to benefit from its cost advantage.

Asian Banker Research expects that TCO for open systems will become even more attractive as further convergence between open and proprietary systems coupled with heavy research and development ensures that technology of open systems keeps maturing and improving.