Open-Source Services Market Size - By Service (Consulting, Integration & Deployment, Training & Certification, Support & Maintenance), By Deployment Model (On-premises, Cloud), By Organization Size (Large Organization, SME), By End User & Forecast, 2024 - 2032

Open-Source Services Market Size - By Service (Consulting, Integration & Deployment, Training & Certification, Support & Maintenance), By Deployment Model (On-premises, Cloud), By Organization Size (Large Organization, SME), By End User & Forecast, 2024 - 2032

Open-Source Services Market Size

Open-Source Services Market size was valued at USD 30.2 billion in 2023 and is estimated to register a CAGR of over 16% between 2024 and 2032. The growing adoption of cloud computing is driving growth in the market. Cloud platforms provide infrastructure designed to run open-source applications. This streamlines the deployment process for organizations by eliminating the need to maintain their own hardware and software licensing.

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For instance, in August 2022, the Cloud Security Alliance highlighted the increasing prevalence of cloud computing within global organizations. It noted that nine out of 10 organizations are increasingly turning to cloud computing to address the challenges posed by remote work arrangements. The surge in cloud adoption has been further propelled by declining hardware expenses, along with a heightened recognition of the cloud's capacity to enhance customer experience through applications. This underscores how the rising embrace of cloud computing is fueling the expansion of the open-source service market.

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The rapid digital transformation among businesses is fueling the adoption of open-source services. Businesses may adopt new technologies and undertake digital transformation efforts at a low cost by using open-source software. Unlike proprietary software with high license fees, open source allows organizations to experiment and evolve without incurring major upfront expenditures. Businesses need to adjust to shifting market requirements as part of the digital transformation. With its inherent flexibility and customizability, open-source software is suitable for developing bespoke solutions tailored to specific business processes. Open-source service providers may help firms customize open-source solutions to meet their unique digital transformation requirements, offering a personalized approach to innovation.

Integration difficulties with existing proprietary software and infrastructure impede open-source services market growth. Open-source software may not always be fully compatible with proprietary software or older legacy systems used by businesses. Data formats, communication protocols, and APIs might all differ widely, posing challenges for smooth data interchange and functionality. Connecting open-source solutions to other systems in an organization's IT architecture can be challenging.

To bridge the gap between different technologies, unique development, as well as specialized tools and additional middleware, may be required. Along with this, integration problems might result in extended project durations and unexpected expenditures. Businesses need to consider the time and resources necessary for customization, development efforts, and debugging any integration difficulties.

Open-Source Services Market Trends

The growing popularity of open source for AI and ML and other technological advancements are spurring market growth. Open-source technologies are expanding to interface smoothly with cloud platforms, allowing organizations to benefit from the cloud's scale and agility. Open-source frameworks, such as TensorFlow and PyTorch, are making AI/ML development more accessible, creating a demand for model training, deployment, and optimization.

Furthermore, technologies, such as Docker and Kubernetes, are transforming application deployment and administration, prompting the need for service providers with experience in containerized open-source solutions. Also, security concerns have always been a hurdle to open-source adoption. However, advancements in security procedures and code auditing tools are improving the security posture of open-source software. Open-source groups are implementing increasingly stringent security measures during development.

For instance, in February 2024, Hugging Face, ServiceNow, and NVIDIA collaborated to release StarCoder2, a family of open-access Large Language Models (LLMs) designed for code generation to enhance developer productivity and innovation in building enterprise applications. This initiative aims to set new standards for performance, transparency, and cost-effectiveness in the field of generative AI. StarCoder2, trained in 619 programming languages, offers three model sizesa 3-billion-parameter model by ServiceNow, a 7-billion-parameter model by Hugging Face, and a 15-billion-parameter model by NVIDIA.

Open-Source Services Market Analysis

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Based on services, the market is divided into consulting, integration & deployment, training & certification, and support & maintenance. The integration & deployment segment accounted for USD 8.8 billion market revenue in 2023. Successful integration of open-source solutions often requires skills and knowledge. Businesses may lack the in-house knowledge to manage these connections.

Open-source service providers in the integration & deployment segment fulfill this need by providing customized development services to bridge specific integration gaps and tailoring open-source solutions to function in tandem with current systems. Even after a successful integration, open-source installations may require continuous maintenance and assistance. Integration & deployment service providers provide technical assistance to fix any difficulties following integration and manage the day-to-day operations of the integrated open-source solution, allowing businesses to focus on core activities.

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Based on the deployment model, the open-source services market is categorized into on-premises and cloud. The cloud segment accounted for around 60% of the market share in 2023. Cloud platforms provide infrastructure designed primarily for executing open-source applications. Businesses do not need to manage their own hardware and software licensing, which simplifies deployment and administration. Open-source service providers can use this cloud architecture to enable easier installation, configuration, and maintenance of open-source solutions.

Cloud computing's inherent scalability complements the adaptability of open-source software. Businesses may simply scale their open-source deployments up and down based on their requirements, resulting in cost savings. Major cloud providers, such as AWS, Azure, and Google Cloud Platform, provide huge markets with a diverse range of open-source solutions ready for implementation. This accessible access broadens the market reach of open-source services and makes adoption easier for enterprises.

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North America open-source services market size dominated around 33% in 2023 and expected to hold over USD 33.5 billion revenue by 2032. North American countries, particularly the U.S., have a long history of accepting and using open-source technology. This early acceptance resulted in a robust open-source culture, a vast pool of experienced experts, and a supporting environment. The region houses strong and stable economies, allowing corporations to invest extensively in R&D. This emphasis on innovation drives the creation and adoption of cutting-edge open-source solutions.

Silicon Valley, Seattle, and Austin are among the main technological hubs in the U.S. These hubs foster cutting-edge open-source initiatives while attracting a global talent pool, thereby improving the open-source services environment. Leading technological companies, such as IBM, Red Hat, and Oracle Corporation, are located in the U.S. These firms actively support open-source projects and provide a wide range of open-source services to meet a variety of business needs. U.S. firms are increasingly exploring digital transformation. Open-source software's cost-effectiveness, adaptability, and scalability make it an appealing alternative for these efforts, resulting in a rising demand.

European countries including France, Germany, the UK, and the Netherlands are witnessing significant growth in the open-source services market. These nations have a strong R&D culture, which fosters innovation and collaboration in the open-source community. This supports a robust open-source community that actively participates in development initiatives. Several European governments are encouraging open-source adoption through initiatives and financing schemes. This boosts R&D, resulting in a favorable environment for open-source service providers.

The APAC region comprises some of the world's fastest-growing economies. This economic expansion fuels investments in digital transformation initiatives, creating a high demand for cost-effective and flexible IT solutions that open-source services can provide. Furthermore, countries in the MEA region, such as the UAE and Saudi Arabia, are undergoing significant infrastructure development projects. Open-source solutions can play a crucial role in these initiatives, offering cost-effective options for building robust IT infrastructure.

Open-Source Services Market Share

IBM and Cisco Systems, Inc. dominate the market with around 9% of the market share. IBM Corporation incorporates open-source technologies into its hybrid cloud solutions, such as IBM Cloud and Red Hat OpenShift, enabling smooth deployment, administration, and scalability of open-source applications and workloads across hybrid cloud infrastructures.

Cisco invests in partnerships and acquisitions to expand its portfolio of open-source services and capabilities. It also emphasizes interoperability and compatibility, ensuring seamless integration with existing IT infrastructure. Through these initiatives, Cisco aims to strengthen its position in the market and meet the evolving needs of customers.

Open-Source Services Market Companies

Major companies operating in the open-source services industry are

• Amazon
• ATOS SE
• Cisco
• Google
• HCL
• HPE
• IBM
• Microsoft
• Oracle C
• SUSE

Open-Source Services Industry News

• In December 2023, Linux Foundation and Meta collaboratively launched a new open-source project, LF Connectivity, to address connectivity challenges within high-bandwidth fixed and mobile connectivity. This project aims to improve enhanced access to networks and is part of the Linux Foundation's efforts to foster innovation through open source.
   
• In November 2023, Persistent Systems launched open-source maintenance service aimed at helping organizations keep their open-source software up to date with patches, bug fixes, and the latest software releases. This service addresses the challenge of delays in software upgrades and maintenance by providing a dedicated team focused on component upgrades while maintaining security and integrity.

The open-source services market research report includes in-depth coverage of the industry with estimates & forecasts in terms of revenue (USD Billion) from 2021 to 2032, for the following segments

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Market, By Service

• Consulting
• Integration & deployment
• Training & certification
• Support & maintenance

Market, By Deployment model

• On-premises
• Cloud

Market, By Organization size

• Large organization
• SME

Market, By End User

• BFSI
• IT & telecom
• Manufacturing
• Healthcare
• Retail
• Government
• Others

The above information is provided for the following regions and countries

• North America
  • U.S.
  • Canada
• Europe
  • UK
  • Germany
  • France
  • Italy
  • Spain
  • Russia
  • Nordics
  • Rest of Europe
• Asia Pacific
  • China
  • India
  • Japan
  • South Korea
  • ANZ
  • Southeast Asia
  • Rest of Asia Pacific 
• Latin America
  • Brazil
  • Mexico
  • Argentina
  • Rest of Latin America
• MEA
  • South Africa
  • UAE
  • Saudi Arabia
  • Rest of MEA

Frequently Asked Questions (FAQ)

What is the value of the open-source services market?

The market size of open-source services reached USD 30.2 billion in 2023 and is set to witness 16% CAGR from 2024 to 2032, owing to the increasing prevalence of cloud computing within global organizations.

Why is the demand for open-source services in integration & deployment growing?

The integration & deployment segment recorded USD 8.8 billion in 2023, due to providing customized development services to bridge specific integration gaps for organizations.

How big is the North America open-source services industry?

North America market held 33% share in 2023, attributed to a long history of accepting and using open-source technology in the region.

Who are the key leaders in the open-source services market?