OSDL Claims Linux Making Major Gains in $6 Trillion Global Retail Sector
BEAVERTON, Ore., Aug. 4 /PRNewswire/ -- The Open Source Development Labs (OSDL), a global consortium dedicated to accelerating the adoption of Linux(R), today announced highlights from recent gains reported by its members on the advance of Linux worldwide in the more than $6 trillion* annual retail industry. This announcement is the first Linux industry collaboration of its kind among major IT vendors, including BakBone Software, HP, IBM, Novell and Red Hat.
"We are seeing significant Linux adoption in the retail sector as companies look for flexibility, reliability and low cost as their legacy IT systems near end of life," said Stuart Cohen, CEO of OSDL. "The increasing availability of Linux-based solutions from both major vendors and ISVs is accelerating the trend. In retail, it's all about lowering costs, streamlining supply chains, and improving margins."
According to retail analyst firm IHL Consulting Group, Linux deployments in retail increased 34 percent in 2004 over 2003. Driven by new market entrants and the rising popularity of Linux, the average cost of a point of sale system has fallen dramatically over the past two years, from more than $4,000 in 2002 to under $1,000 in 2004, according to IHL.
Overall retail market spending on IT for 2005 is estimated to exceed $21 billion, according to market research firm IDC (July 2005). According to OSDL members who are working with customers in the retail sector, the industry is under pressure in certain key areas that are helping to drive them towards the value, performance and uptime offered by Linux-based solutions:
-- Multiple stores in distributed locations without local IT staff;
-- Significant installed base of old technology that is being refreshed;
-- Rapid move to reach new customers through the Internet;
-- New technologies (such as RFID) that create opportunities and
-- Competition from very large global companies (with huge economies of
scale) and smaller companies (nimbler, faster to react to market
-- Increasing integration of companies with suppliers and partners. Tens of thousands of retail companies are investing in Linux-based solutions worldwide. Six major retail firms working closely with OSDL members BakBone, HP, IBM, Novell and Red Hat reported significant recent advances in Linux deployments, including (see Appendix A below for details):
-- Anaconda Sports, largest U.S. retailer of amateur league sports and
school district equipment;
-- Boscov's Department Store, largest family-owned retailer in the U.S;
-- Burlington Coat Factory, 340 stores in 42 states;
-- GLOBUS, 90 retail locations in Europe with more than 20,000
-- Mercadona, Spain's largest supermarket chain with more than 900
-- Retail Ventures, Inc., a holding company for DSW, Filene's Basement
and Value City Department Stores, has more than 325 retail outlets
nationwide. The benefits of consolidation on Linux can be a critical factor for some customers.
"Our Linux on the mainframe solution has enabled Boscov's to drastically reduce software and systems administration costs, saving nearly $1 million over a three-year period," said Harry Roberts, CIO of Boscov's. "As we complete our transformation into an on demand business, we look forward to improving our service and introducing many innovative solutions that make shopping in our stores a unique experience."
For other customers, price and low total cost of ownership are the key decision criteria.
"In the highly competitive retail industry, technology implementation choices are driven by the need for reliable and robust solutions at the best possible price," said Dennis Moore, director of enterprise architecture for Retail Ventures, Inc. "We leveraged a secure, high-performance Linux foundation and BakBone's first-to-market support for the latest enterprise Linux versions to achieve enterprise-class data protection at an open systems price point."
And Linux offers performance, critical to meeting the demands for speed and convenience that customers expect in a retail experience.
"We were looking to improve the performance of our computing systems and the implementation of Red Hat technology simplifies and speeds up core processes at Mercadona," said a spokesman for the supermarket. "Our use of Red Hat will eventually lead to the optimisation of our customers' time in supermarkets, making the checkout process easier and helping cashier staff to process payments."
Linux offers retail customers a wide range of benefits to meet their industry-specific requirements. Among the most often cited are: -- Reliability -- delivering the uptime needed for stores, back offices
-- Remote management -- enabling distributed store locations to be
easily managed by central IT staff;
-- Flexibility -- avoiding vendor lock-in without compromising the
security and reliability of legacy technology as well as ease of
quickly porting to new processors (handhelds to supercomputers);
-- Middleware for Linux -- enabling application, process and business
integration throughout the supply chain;
-- Applications on Linux -- increasing availability of key applications
for e-commerce, store operations, back office processing and business
-- Low cost -- reducing systems administration, management and client
license operating costs as well as lowering capital expense for
hardware. About Open Source Development Labs
OSDL -- home to Linus Torvalds, the creator of Linux -- is dedicated to accelerating the growth and adoption of Linux in the enterprise. Founded in 2000 and supported by a global consortium of major Linux customers and IT industry leaders, OSDL is a nonprofit organization that provides state-of-the-art computing and test facilities available to developers around the world. With offices in China, Europe, Japan and the United States, OSDL sponsors legal and development projects to advance open source software as well as initiatives for Linux in telecommunications, in the data center and on enterprise desktops. Visit OSDL on the Web at http://www.osdl.org/ . NOTE: OSDL is a trademark of Open Source Development Labs, Inc. Linux is a trademark of Linus Torvalds. Third party marks and brands are the property of their respective holders. *Source. Retail Forward, Inc. (December 2004). Retail sales, excluding automobile, for the top 10 country markets in the world exceed $6.3 trillion. Appendix A Anaconda Sports
New York-based Anaconda Sports, the largest retailer of amateur league sports and school district athletic equipment in the United States, wanted to build a cost-effective e-commerce Website and turned to Linux as a reliable, scalable and secure platform. Anaconda relies on IBM applications, middleware and Intel architecture servers running Red Hat Enterprise Linux.
-- ROI: Sales up 20 percent Boscov's Department Store
The largest family-owned retailer in the United States, Boscov's Department Store operates more than 40 stores in five states adding two or three stores a year. But its online Web e-commerce site is growing even faster, doubling in transactions annually. To slash the escalating software and systems administration costs required to run its expanding datacenter of standalone servers that power the Web site, Boscov's consolidated everything onto a single IBM mainframe server running Novell SUSE Linux.
-- ROI: Software and systems administration savings in the first three years expected to exceed $1 million. Burlington Coat Factory
For several years now, Burlington Coat factory has been running its enterprise on 5,000 Linux-based point of sale systems at more than 340 stores in 42 states nationwide. The next step was replacing its legacy large server systems. Recently Burlington turned to Novell SUSE Linux running on more than 2,000 clustered Intel architecture servers from IBM with a migration of two key applications in less than two weeks.
-- ROI: Hardware capital expenditure savings of tenfold compared to legacy UNIX environment. GLOBUS
A leading European retailer with 20,000 employees at more than 90 locations, GLOBUS ran its business with a custom-developed ERP application on a proprietary UNIX system with a server based in each store. To cut both software and hardware expenditures, GLOBUS began to move to Intel architecture servers from Bull running Novell SUSE Linux, with two inexpensive servers replacing the single, expensive, proprietary server at each store.
-- ROI: Stores close each night 25 percent faster, with most of the ERP system now running on Linux, at much lower costs than before. Mercadona
With nearly 900 stores around the country, Mercadona is Spain's leading supermarket chain. Mercadona turned to Linux for a secure, flexible and cost-effective platform to run its business -- both at individual stores as well as at the corporate central offices. Currently the chain is in the middle of a five-year deployment of more than 1,000 Intel architecture servers as well as 10,000 desktop/point of sale terminals, all running Red Hat Enterprise Linux. Retail Ventures, Inc.
Retail Ventures, Inc. (RVI) is a publicly-traded holding company for three major retail brands: DSW Shoe Warehouse, one of the largest shoe retailers in the U.S. with 184 stores; Filene's Basement, the country's oldest off-price store selling brand-name and designer fashions to men and women at 27 stores nationwide; and Value City Department Stores, an off-price department store chain with 114 stores in more than 30 markets. RVI turned to a data protection solution from BakBone Software running on Novell SUSE Linux to safeguard 14 TB of mission-critical data. The solution integrates across a mixed platform environment comprising Novell SUSE Linux, Red Hat Enterprise Linux, Microsoft Windows, and Sun Solaris servers. As a result, RVI has accelerated its data backups while dramatically reducing the time and effort to restore valuable financial, ERP, merchandising, warehousing and other retail information.
-- ROI: The time and effort to restore critical files has been reduced from more than five hours to less than 10 minutes at 60 percent the cost of competing solutions with the combination of BakBone and FalconStor's VTL products.
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