Can IBM’s Symphony strike a chord in the corporate Office?

IBM is trying to turn the screw on Microsoft's Office franchise, announcing a support service to complement the freely-available Symphony desktop software suite. By doing so IBM hopes to raise acceptance of its freeware alternative in corporate circles, the logic being that support equates to dependability. IBM is trying to wrestle market share away from a desktop software business that's traditionally an impenetrable revenue fortress for Microsoft. We believe that Symphony is unlikely to make a dent anytime soon even though it presents an attractive case financially to make an open source switch.

IBM is persevering with the Lotus Symphony desktop productivity suite it first put into beta in September last year as a free open source alternative to licensed Microsoft Office applications. Symphony is an IBM-modified version of the open source OpenOffice.org software that adheres to the OpenDocument Format (ODF).

IBM is effectively offering Lotus Symphony as freeware, which is both a strength and a weakness. While it makes Office-like applications extremely affordable it has also lacked formal support, something that hasn't inspired confidence for companies to make the switch from Office. As a result Symphony has largely fallen on deaf corporate ears.

IBM wants to change that and has now backed Lotus Symphony up with chargeable remote support, priced at an attractive $25–50 per user per year, with a ceiling of $25,000 for enterprise-class support for up to 20,000 users – which works out at $1.25 per user per year. Anything even slightly above that and you'd have to fork out another $25,000.

Ultimately the decision to unplug Office and go with free open source alternatives is less about functionality and more about economics – particularly in a tight economy that is forcing companies to weigh up the cost and time of migrating away from Office. That might seem trivial, but in fact it can be quite expensive, even for upgrading from earlier versions in terms of retraining.

An important question is how the cost of Symphony's support compares to Microsoft and other Office alternatives. An enterprise agreement license for Office 2007 is $155 per year, which totals to roughly $3 million for 20,000 users. Symphony also compares favorably to support for Sun's OpenOffice's proprietary offshoot – StarOffice. For 20,000 users Sun charges around $9–11 per user for a year depending on the level of support. What Sun does not disclose is how economically that price slides for different numbers of users.

STICKING WITH OFFICE

That said, there are also some technical reasons for customers sticking with Office. Symphony still lacks quality in terms of its interface and is based on a heavily rewritten version of older 1.1.4 OpenOffice source code that was released way back in 2003.

We feel that IBM doesn't harbor any significant revenue ambitions with Symphony. Rather IBM is sending a strong message to cash-strapped SMBs: why spend money on expensive Office licenses and upgrades when you can get the same functionality for a fraction of the price from an open source derivative? Yet we find it odd that IBM should opt to push open source OpenOffice code into what is really a closed source alternative. Perhaps a better strategy would have been to offer support services around the core OpenOffice suite itself.

And without email and collaboration components Symphony won't be able to steal much share from Office. IBM has so far been cagey about the possibility of it open sourcing that functionality from parts of its Notes product and adding it to the Symphony experience. We also believe there's scope for IBM to pursue a similar open source equivalent of Microsoft's popular SharePoint platform as well.

On a more positive note, we believe that IBM's continued endorsement of the ISO-certified ODF format is a powerful driver for adoption and growth of open source desktops. It also positions OpenOffice strongly against Microsoft's rival document format based on Office Open XML (OOXML), which is linked to Office 2007. If the latter doesn't make it through the standards maze then Symphony will emerge as an attractive option for government customers mandated to buy open standards based software.

If Symphony manages to gain sufficient critical mass in terms of adoption then it might force Microsoft to rethink its client software packaging and licensing and move towards a hybrid traditional on-premise/subscription-based licensing model that melds software and services fees. But ultimately the trick is to keep OpenOffice-like suites compatible with Microsoft Office. Most customers simply won't touch an open source desktop that doesn't seamlessly link to Office.

Courtesy: Madan Sheina, Principal Analyst, Ovum