Making the business case for an open-source CMS

At this point in its evolution, the technology advantages of open-source over proprietary software for most organisations are well known. They include:

1. Reliability of a continuously reviewed product
2. Flexibility of being able to adapt code to your needs
3. More control over your own technology resources

However, making the business case for an open-source solution is not always straightforward. Software can be considered as a capital expense or an operational expense, and depending on how an organisation does its accounting, that can change how procurement decisions are made. Also, the price tag of any new software comprises  one-off costs for the initial purchase and set-up, as well as ongoing costs to keep it running.

Let’s take a look at the components of these costs for a typical newsroom system and how an open-source solution compares to a proprietary one.

Costs of software licences

There are numerous kinds of software licences, which reflect different models of software development on one hand and permissions on the other. For our purposes the key difference between proprietary and open-source software is that proprietary software requires a licence to use it, and the cost of that licence can be high. Often priced by the seat, or number of users, a proprietary system like a CMS can range from €50 per user, per month, to annual fees in the seven-figure range for large enterprises. 

By contrast, most free and open-source software (FOSS) does not come with licensing fees to use, no matter how few or many potential seats are involved. This cost savings alone can go a substantial way toward making the business case for an open-source solution. But since it only represents part of the acquisition cost of any new software, it has to be weighed alongside other ongoing costs, which can contribute as much as half of a project’s total price tag.

Installation costs 

Even if the software in question is web-based, it still requires certain conditions or prerequisites to run in an organisation’s environment. This includes hardware requirements such as production servers to software dependencies such as an operating system or specific library files. 

The cost of setting up the environment and installing proprietary software is usually included in the price (unless there are some customisations or add-on features required by the customer which would put them into a different service category).

 For open-source software, installation is a DIY option by default, although consultants or in some cases the developer themselves can perform the installation, integration and configuration for a fee. This can be useful especially if an organisation does not have an in-house IT department or much experience with open-source tools.

Integration costs

Most organisations have a set of existing systems that the new software will need to work with. The advantage of open-source software based on open APIs is that it integrates more readily with legacy systems, but such a task is still better left to the experts -- whether that means an external consultant or the vendor itself. In either case, it can be useful to ask for cost estimates from several potential providers.

Configuration costs

Because configuration includes many of the aspects of how the overall environment for software is set up, such as the choice of hardware and operating system, it is sometimes included in the installation cost. However, some specialty software needs to be “tuned” to user needs and organisational context, which can constitute a configuration process in its own right. Sometimes configuration settings can be missing or poorly documented, for open-source as well as commercial software. When in doubt, ask for the configuration process to be spelled out.

Training costs

This is one of the costs that typically gets overlooked in budgeting for new software because the actual work of training comes only after the software is installed. But it’s important to decide how to manage this up front. Both proprietary vendors and consultants offer training for different fees. In the case of an open-source solution, you may be able to find enough documentation produced by the community to put together training with your own resources.

Maintenance costs

Similar to licensing costs, maintenance of open-source projects is nominally free, while costs for proprietary solutions can incur substantial yearly outlays. What free “costs” in the world of open-source is the willingness and ability for an organisation to self-manage its software, not only in the sense of basic maintenance but also of knowing the direction that the business is headed and what features and functions are needed to support that evolution. If that is the case, then open-source can provide a higher degree of flexibility over proprietary solutions, as the closed solutions tend to come with forced upgrades which may not necessarily align with operational needs. 

Support costs

Open-source software almost by definition is built by, and around, a community of developers and users. Often there are forums where common issues are raised and solutions are shared among members of the community. In addition to this, paid support options are also available from many open-source software vendors. The advantage, again, is the flexibility for customers to be able to assemble a mix of DIY and paid support options, whereas proprietary vendors may only offer different levels of support services that meet most of the requirements of their target customers.

Doing the math - and getting to yes

Some organisations will also want to estimate the return on an investment (ROI) in new software. But this comes with a caveat.  Some newsroom consultants say that ROI is only really useful as a comparative tool, with your current system as the point of reference. Another consideration for ROI is the time horizon; different organisations may expect to see the system start to pay for itself after 18 months, 24 or longer.

Because ROI can be difficult to measure, especially for smaller organisations that may not have the kind of underlying data collected by large enterprises, a more universal measure to consider instead is TCO (total cost of ownership). Here is a handy guide to TCO for software according to the Principles for Digital Development. 

However your organisation does its accounting, purchasing enterprise software is a strategic decision that requires leadership buy-in above all else. It’s good if the folks in the C-suite are convinced of the benefits of the solution you propose. But it’s even better if that decision puts their leadership in a positive light. That is a strategic move to ensure your investment will get the care and attention it needs to be viable for the long term.

Want to know more about the TCO of a digital newsroom system like Superdesk? Sign up for a demo to schedule time with one of our experts.