Commentary: As bad as things may get due to COVID-19, open source just might make life a little better, at least regarding an economic downturn and possible recession.
Over the last few weeks, there’s been plenty of bad news. The way things are looking with the coronavirus pandemic, we’re in for even more bad news over the coming weeks and, likely, months. In a time when people’s health is at risk, money doesn’t matter much. Even so, economists are starting to utter the “R” word, as consumers and businesses delay spending amidst novel coronavirus uncertainty, which will, in turn, create even more hardship.
One bright spot is that more organizations will turn to open source as they seek to do more with less, which was the case from 2007 to 2008 during the Great Recession, as well as during the dot-com bust of 2000 to 2001. Open source adoption has been accelerating for a long time, but as open source vendors and communities experienced during the last recession, it tends to do even better as things get bad.
3 possible outcomes to the coronavirus pandemic
According to McKinsey & Co. analysis, there are at least three possible outcomes to the coronavirus pandemic. In the best case scenario, the world responds in somewhat similar fashion to China, and we see GDP growth for 2020 fall from roughly 2.5% to 2.0%. In this scenario, the US economy recovers by the end of the first quarter. Happy(ish) days.
Of course, few companies operate like China with strong state control, which means we’re more likely to see something like McKinsey’s second scenario: A global slowdown. This is the world in which we’re currently living, where governments and private entities are combining to have workers stay home, public gatherings are banned, etc. Even with such measures, global GDP gets chopped in half, falling to between 1% and 1.5%, according to McKinsey. Days are not so happy, but by the middle of Q2 life becomes somewhat normal again.
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In the final scenario–pandemic and recession–coronavirus turns out to not be seasonal, pushing problems well in Q3, which means economic recovery doesn’t really kick in until Q4. Global GDP falls to between 1.5 and 0.5%. Nothing remotely happy in this scenario.
All of these scenarios portend financial hardship for people around the world, compounding the physical hardships we will already endure. To minimize the negative impacts on individuals throughout this time, companies will need to figure out how to operate more efficiently. As in the 2007/2008 recession, open source will become ever more appealing.
Opening up to open source
Minus the serious health concerns, the economic fallout could be similar to what we’re about to experience globally. Talk to those who lived through that recession, however, and a different narrative emerges for those working at open source companies. Without wanting to smugly minimize the economic hardships that others experienced, it’s worth digging into open source as a way to benefit all.
According to Nick White (then at SpringSource), “The impact on open source companies lasted 90 days and then we were back hiring and in fact acquiring other companies.” This tallies with my own experience, working at the time for Alfresco. We went through the recession profitable, with revenue growing strongly each year. As I wrote in 2008 for CNET (Open-source innovation in a recession), “Open source breeds communities, which in turn add value to the software, making this innovation more of a group effort (and, hence, potentially a less costly effort).”
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Today, buying into open source requires even less risk than it did back then, when companies were still testing the waters. Today for things like data infrastructure, open source is already recognized as the safe, innovative choice. Adding to this, there are a number of open source companies that have been thriving as they increasingly deliver open source software as a service, and should do even better as companies try to make the most of tightened budgets:
There are other companies, from MariaDB to DataStax to Percona and beyond, that have experienced exceptional results. In talking with sources at a range of these companies, the slowdown seems to be giving them a bump, as suggested above.
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I cite these examples because it’s publicly available data, but of course much of the benefits that organizations will derive from open source in this difficult time will come from unpaid adoption of open source software. They’ll use Apache Flink for event-driven applications; Envoy as an edge proxy; and more. They’ll be more willing to trade time to save money (rather than trading money to save time with commercially supported open source). It will end up being a good thing for those companies and the people who work for them.
Not that it will make things easy. These next few months are going to be hard, and especially for those who don’t know anything about open source software like Flink, Envoy, Elasticsearch, etc. But in some way, if their jobs are saved because a smart engineer figured out how to do more with less using open source, they’re going to benefit, even if they don’t know who to thank.
Disclosure: I work for AWS, but nothing herein relates to my work there.